Dompok: More CPO exports in the best interest of all

KUALA LUMPUR: THE Plantation Industries and Commodities Ministry has stressed that the temporary increase in duty-free crude palm oil (CPO) export quota is in the best interest of all stakeholders.

They include from upstream (growers, millers and smallholders) to the downstream (refiners, processors, traders and exporters).

Plantation Industries and Commodities Minister Tan Sri Bernard Dompok reiterated that the increase is an interim measure to manage stocks and ensure remunerative prices for the producers.

"The government is mindful that the palm oil sector has many stakeholders. This move is the best way for everybody," Dompok told reporters here after launching a ministerial- level Merdeka celebration yesterday.

The minister was commenting on the government's recent move to raise CPO export quota by an additional two million tonnes, making it a total of five million tonnes in 2012, or 30 per cent of total CPO production in Malaysia.

This is to address the falling market share contributed by Indonesian export tax structure on palm oil products and also as a stock management tool.

Palm Oil Refiners Association of Malaysia said the increase in CPO export quota is worsening the loss of money the downstream sector is experiencing, which was triggered by the restructure of Indonesian palm oil export taxes in October 2011.

Due to the increased quota on CPO exports, Malaysia's refining capacity usage has decreased to 60.8 per cent for the January-June 2012 period, compared to 72.9 per cent for the same period in 2011.

On another note, Dompok said nothing has materialised between Malaysia and Indonesia on talks to work out a common policy on export tariffs of the edible oil.

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