Lang
JAKARTA: Indonesia anticipates a substantial increase in its palm oil export levy collections this year, with expectations for a jump of approximately 31% compared to last year's figures. This projection, outlined in a government statement released on Friday, is attributed to a combination of rising crude oil prices globally and a recent hike in the palm oil export tariff.
According to details provided by the coordinating ministry of economic affairs, the nation's palm oil export levy collections are forecast to reach 41.22 trillion rupiah (approximately $2.33 billion USD) by 2026. Demonstrating robust performance in the current year, collections during the first seven months touched 27.81 trillion rupiah, marking a significant 73.3% increase over the same period in the previous year.
Indonesia utilizes these export levies, collected on both palm oil and cocoa bean exports through its plantation fund agency, to finance crucial programs within the agricultural sector. These initiatives include the country's ambitious biodiesel mandate and vital replanting schemes for smallholder farmers.
A key factor contributing to the expected surge in revenue was the increase in the crude palm oil export levy in March. The levy was raised to 12.5% of the CPO reference price, up from 10%. This adjustment was implemented after the plantation fund's balance was deemed insufficient to effectively bridge the price disparity between crude oil-derived fuels and palm oil-based alternatives. Following these measures, the plantation fund is now estimated to achieve a surplus of 18.45 trillion rupiah by the close of 2026.
Furthermore, the ministry reported that the fund has already disbursed 2.42 trillion rupiah for replanting efforts. From January to August this year, these funds facilitated the replanting of 40,484 hectares of smallholder palm oil plantations, underscoring the government's commitment to sustainable agricultural practices and supporting its farming community. Source: The Star