Malaysian palm oil to be more competitive following export duty revision, minister says
Recasts with minister's comments on revision of CPO export duties
By Ashley Tang
KUALA LUMPUR, Oct 22 (Reuters) -Malaysia's commodities minister on Tuesday dismissed concerns over a government decision last week to expand duties imposed on the country's crude palm oil exports, saying it would make the sector's downstream operations more competitive.
"When we charge higher taxes on CPO exports, we are actually encouraging more value added products to be developed by the downstream sector," minister Johari Abdul Ghani told reporters at an industry conference.
Prime Minister Anwar Ibrahim, while presenting the government's 2025 budget on Friday, had announced plans to revise crude palm oil export duty rates and market price range structure from November.
In a budget appendix released by the finance ministry following the presentation, the government said it would raise the maximum export duty rate to 10% for crude palm oil priced above 4,050 ringgit ($937.50) per metric ton effective Nov. 1.
The current export tax structure starts at 3% for crude palm oil in a 2,250 to 2,400 ringgit-per-ton range, with the maximum rate set at 8% for CPO prices above 3,450 ringgit per metric ton.
Under the new measures, export duties will also be imposed at a rate of 8.5% for crude palm oil priced between 3,601 to 3,740 ringgit, 9% for prices between 3,751 to 3,900 ringgit, and 9.5% for prices between 3,901 to 4,050 ringgit.
Separately, Johari said Malaysia will no longer contribute to deforestation through palm oil cultivation, focusing instead on increasing output.
"We are not going to deforest any more new areas. We have committed to the world that we will focus on the current land that we have in order to increase our production yields and encourage more replanting in the same land," he said.
The government will assist small farmers so they can be certified under Malaysian Sustainable Palm Oil standards, which require growers to meet criteria on protecting the environment and workers' rights, he said.
($1 = 4.3200 ringgit)
Reporting by Ashley Tang; Writing by Rozanna Latiff; Editing by John Mair, Martin Petty
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