Indonesia may keep CPO export tax at 0%

The Indonesian government said that despite rising palm oil prices, it may keep its palm oil export tax at 0% starting in May. Based on the Trade Ministry’s calculations, the average crude palm oil (CPO) price in March was still below US$700 per metric ton (MT). Indonesia does not tax palm oil exports until the minimum reference price hits US$700 per MT. In its monthly computations, the government uses the average spot price of crude palm oil in Rotterdam, Europe’s vegetable oil market, for the preceding month, as the reference price. Palm oil physical prices normally track Malaysian palm futures, which have surged 46% this year amid fears of a sharp fall in palm stocks in the world’s second-biggest producer. (April 16, 2009)