Malaysia considers temporary suspension of crude palm oil export duty amid record stocks

Malaysia’s Finance Ministry is reviewing a proposal to temporarily suspend the export duty on crude palm oil (CPO) amid record-high inventories in the country. The announcement was made on October 29 by Malaysia’s Minister of Plantation and Commodities, Noraini Ahmad, during a parliamentary session. The measure could help stimulate exports and reduce excess domestic stocks.

Malaysia’s palm oil inventories reached a record 3.51 mln tons at the end of September 2026. The large volume of accumulated stocks is putting additional pressure on the market in the world’s second-largest palm oil producer. A temporary suspension of the export duty could improve the price competitiveness of Malaysian products in international markets and encourage stronger demand from overseas importers.

According to Noraini Ahmad, relevant ministries will provide the Finance Ministry with recommendations and economic assessments to evaluate the potential consequences of changes to export tax policy. The government will consider the interests of the palm oil industry and overall market conditions when reviewing the proposal. The final decision on any suspension of the export duty rests with the Finance Ministry.

Parliament discussed the possibility of suspending the duty for a period of three to five months. However, the timing and duration of such a measure have not yet been determined. Malaysia previously introduced a similar mechanism in 2020, when crude palm oil export duties were waived for six months after inventories exceeded 2 mln tons.

A potential suspension of the duty could provide support for Malaysian crude palm oil exports amid abundant domestic supplies. However, its impact on the market will depend on international buying activity, production volumes and the pace of inventory reduction. No decision to suspend the export duty has been made so far, and the proposal remains under review by Malaysia’s Finance Ministry.

Tags: Crude palm oil, Malaysia, CPO