Indonesia to raise palm oil export levy to 4.5% to 10%, official says

Indonesia will raise its palm oil export levy to between 4.5% and 10% of the crude palm oil reference price, up from 3% to 7.5%, to finance a mandated increase in the amount of the oil used in biodiesel, a plantation fund official said on Tuesday.

Indonesia raised the mandatory amount of palm oil in its biodiesel mix to 40% this year from 35%. It is studying increasing it to 50% in 2026, as well as a 3% blend for jet fuel next year, as it seeks to curb fuel imports.

Kabul Wijayanto, director at the Plantation Fund Agency, which is in charge of collecting and distributing the export levy, said authorities would impose the new rates three days after the regulation is issued.

Wijayanto said the regulation was being processed by the law ministry. The agency was expected to distribute 35.47 trillion rupiah ($2.15 billion) for the biodiesel subsidy this year. The increase in the crude palm oil levy to 10% from 7.5% was flagged by the government late last year, but has so far not been enacted. More refined palm oil products are charged lower levy rates.

Tags: palm oil, export levy, reference price, Indonesia, biodiesel