Indonesia reduces palm oil exports to ensure supply at home

Workers harvest palm oil in Pelalawan, Riau province, Indonesia. (Photo: AFP/VNA)

Jakarta (VNA) - Indonesia, the world’s biggest palmoil producer, is about to cut its overseas shipments of the commodity, as ittightens a policy requiring companies to keep more supply at home.

The Government cut the amount producers can export to sixtimes the domestic sales requirement, down from eight times currently,according to Budi Santoso, DG of foreign trade at the Indonesian TradeMinistry. The change took effect from January 1.

Firman Hidayat, an official at the Coordinating Ministry forMaritime Affairs and Investment, said the Government wants to ensure ampledomestic supply during the Ramadan and Aidilfitri holidays in April asproduction will be seasonally weaker in the first quarter.

On the contrary, the tightening of palm oil exports in Indonesia has affectedthe prices in Malaysia, the world's second largest exporter of this commodity.The move may encourage Malaysia to raise prices and exports./.

VNA