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Dompok: Malaysia will extend zero duty rate for CPO for another month

January 15, 2013

Malaysia is extending its zero duty rate for crude palm oil (CPO) for another month to meet competition from Indonesian exporters as part of efforts to reduce the stockpile of the commodity, according to Plantation and Primary Industries Minister Tan Sri Bernard Dompok.

By  Sathish Govind

KUALA LUMPUR: Malaysia is extending its zero duty rate for crude palm oil (CPO) for another month to meet competition from Indonesian exporters as part of efforts to reduce the stockpile of the commodity, according to Plantation and Primary Industries Minister Tan Sri Bernard Dompok.

” We will allow the tax for the coming month to remain at zero,”  he told newsmen after officiating the Palm Oil Economic Review Outlook Seminar 2013 in Kuala Lumpur yesterday.

Indonesia is planning to reduce its own export tax rate from 7.5% to zero, as announced by its Trade Minister Gita Wirjawan three days ago.

Wirjawan had said that Indonesia would maintain the rate at any level that would help it spur downstream development of the industry and competitiveness of its processors and refiners.

Dompok said any action taken by both major producers of the commodity will affect prices and the economies of both countries.

He also pointed out that rivalry between Malaysia and Indonesia will erode their respective competitiveness and benefit buyers such as India, China and Pakistan. Malaysia is expected to start trimming its stockpiles, which has reached record highs on declining exports, when the government begins to introduce the programme to blend 10% of palm oil with diesel (B10) destined for the non-subsidised diesel market.

The move is expected to raise domestic consumption of palm oil by 300,000 tonnes per year.


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