Indonesia, the world’s largest producer of palm oil, is considering new regulations that would require exporters to trade a portion of their palm oil domestically before exporting it. The move is aimed at increasing transparency and control of the commodity.
According to the acting head of the Commodity Futures Regulatory Authority (Bappebti), the regulation is intended to provide reference prices for palm oil products for tax calculation and export tax collection, and to provide a clearer view of supply and demand.
In April, rising domestic prices prompted the government to temporarily suspend palm oil exports, causing chaos in the global and local markets. In response, Indonesia is seeking to increase price and supply controls and find ways to improve the value chain of overseas sales.