The Indonesian government increased the reference price of Palm oil (CPO) for February, setting it at US$806.40 per tonne, an increase from the previous price of US$774.93 per tonne, as reported by AgriCensus and based on a circular from the Ministry of Commerce.
Due to the current export tax structure, this adjustment resulted in an increase in export duties and CPO tax to US$ 85 per ton and US$ 33 per ton, respectively, compared to the previous values of US$ 75 per ton and US$ 18 per ton, according to a January 31 report.
AgriCensus highlighted that the adjustment in export taxes for other palm oil derivatives made Indonesian exports more expensive.
Fastmarkets announced that the new reference price, valid throughout February, replaced fortnightly reviews, according to a pre-announcement report. This adjustment aims to harmonize the frequency of price reviews of the Indonesian CPO with the practice adopted by Malaysia. Reference price for February: MYR 3571.39/ton (US$ 755/ton). CPO export tax: MYR 285.71/ton (US$ 60.42/ton).
Indonesian methodology uses prices from Bursa Malaysia, ICDX and Rotterdam to set the CPO reference price, according to the report.
However, the Indonesian government reevaluates the palm oil price formula, potentially excluding Rotterdam prices. Decision pending on publication of AgriCensus.
Source: Oils & Fats International
