Indonesia's plan to review domestic market obligation (DMO) rules Palm oil will not affect the DMO’s export index, a senior commerce ministry official said on Thursday. Indonesia, the world’s largest palm oil exporter, requires local sales at a fixed price for export licenses.
Budi Santoso, the director general of international trade, said there were “no plans yet” to change the DMO’s export ratio. Export quotas are four times the volume of palm oil supplied locally, under the DMO scheme. Companies selling in smaller volumes and for domestic use receive extra quotas.
As of the end of July, the outstanding palm oil export quota was 3.95 million metric tons, Budi said. In addition, the government plans to raise the price cap on cooking oil, according to Isy Karim, director general of domestic trade.
On the other hand, the new rule will no longer recognize bulk cooking oil as part of the DMO, he added.
Finally, when establishing the DMO scheme, Indonesia aimed to secure the sale of 300,000 tons of cheap cooking oil each month. However, in recent months, the scheme has achieved only about half of that target due in part to a weak export market.
Source: Bernadette Christina | Notícias Agrícolas
