Palm oil news. June 2026
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June 09, 2026
Palm Oil Market Turmoil in Indonesia Creates New Opportunities for Global Suppliers
Indonesia's investigation into hundreds of palm oil companies is reshaping market dynamics and could open new opportunities for competing exporters across Latin America and beyond.
Indonesia, the world's largest palm oil producer and exporter, has launched investigations into hundreds of palm oil companies accused of failing to pass higher prices on to farmers as the market recovered from a recent downturn. The move, announced by Agriculture Minister Amran Sulaiman on June 8, adds new uncertainty to the global vegetable oils market and is drawing attention from traders, food manufacturers, and competing producers worldwide. The development matters because Indonesia accounts for roughly 60% of global palm oil production, meaning policy changes in Jakarta can quickly influence international prices, trade flows, and sourcing decisions.
According to Indonesian authorities, information on approximately 270 to 300 palm oil companies has been submitted to law enforcement agencies for investigation. Officials say the companies may have failed to adequately adjust payments to growers after palm oil prices recovered from a sharp decline triggered by Indonesia's new export policy.
While most of the country's approximately 1,900 palm oil companies have reportedly increased prices paid to farmers, the government is signaling that it intends to closely monitor compliance throughout the supply chain.
While most of the country's approximately 1,900 palm oil companies have reportedly increased prices paid to farmers, the government is signaling that it intends to closely monitor compliance throughout the supply chain. Agro Latam
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Indonesia asks police to probe hundreds of firms on palm oil prices
(June 8): Indonesia’s agriculture minister has asked police to investigate hundreds of palm oil companies that failed to pay farmers more as prices recovered from a slump driven by the country’s new export policy.
The ministry has received reports on 270 to 300 firms that have not adjusted their prices over the past few days and has submitted the information to police, including special crime units, Minister Amran Sulaiman said after meeting with local government officials, the palm oil industry association and farmers groups on Monday.
Sulaiman said he’d asked the police to carry out proper investigations before taking any enforcement action. Most of Indonesia’s around 1,900 palm oil companies have increased the prices paid to farmers, he said.
The move is another instance of the government intervening in the palm oil market after it announced late last month it would take control of some key commodity exports in a sweeping overhaul. Indonesian palm oil prices fell after the policy was announced on fears shipments would slow down and stockpiles would swell, but have since recouped most of the losses.
All parties at the meeting agreed there should be no further decline in Indonesian palm oil prices, Sulaiman said. “There are around 15 million farmers, and we cannot allow them to suffer losses,” he said, adding that the weakening rupiah should be beneficial for exports and farmers.
Prices of fresh fruit bunches were about 3,800 rupiah (US$0.21 or $0.27) a kilogram before the policy was announced on May 20, according to a farmers group. They subsequently fell as low as 1,500 rupiah, before recovering to 3,400 rupiah on Friday. The Edge
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Food task force suspects cartel behind plunge in palm FFB prices
JAKARTA – Indonesia’s National Police Food Task Force suspects cartel activity may be behind the sharp decline in Fresh Fruit Bunch (FFB) prices received by palm oil farmers, despite rising global crude palm oil (CPO) prices.
The head of the task force, Brigadier General Ade Safri Simanjuntak, made the remarks following a meeting with Agriculture Minister Andi Amran Sulaiman, palm oil industry associations, farmer representatives and police officials on Monday (8/6).
According to Ade, the recent decline in FFB prices appears to be an anomaly for the palm oil plantation sector.
“We suspect there are indications of a cartel or unlawful collusion here — a covert agreement aimed at pushing down FFB prices even as global CPO prices have not declined,” Ade said at a press conference.
To follow up on the allegations, Ade said the Food Task Force would work with Indonesia Competition Commission (KPPU), both at the national and regional levels.
The investigation will also involve the Special Criminal Investigation Directorates at regional police departments, which serve as local Food Task Force units.
In addition, the task force is examining trading practices that may have harmed the state, including under-invoicing and under-pricing.
As a result, Ade said law enforcement authorities would not hesitate to take firm action if violations are found.
In an earlier report, Agriculture Minister Amran Sulaiman said the government had identified as many as 300 companies purchasing palm oil FFB at unusually low prices.
Following the findings, Amran said he plans to report all of those companies to law enforcement authorities. (KR/ZH) IDN Financials
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Indonesia cracks down on companies suppressing palm prices
Jakarta (ANTARA) - President Prabowo Subianto has reportedly instructed a 10 percent increase in the price of fresh fruit bunches (FFB) from oil palm, in line with rising global crude palm oil (CPO) prices.
“The president is defending 15 million farmers, saying FFB prices must return to their original levels, and even increase by 10 percent,” Agriculture Minister Andi Amran Sulaiman said here on Monday.
According to him, the directive underscores the importance of protecting the welfare of around 15 million oil palm farmers by restoring FFB prices and encouraging further increases.
He said the adjustment is reasonable, supported by the upward trend in global CPO prices and the strengthening US dollar against the rupiah.
Sulaiman noted that around 70 percent of FFB prices across regions have gradually recovered, and that the government, together with the Food Task Force and police, will ensure full price normalization.
He added that the recent decline in farmgate FFB prices is considered an anomaly, as the commodity should have increased by about 10 percent in line with global market conditions.
The minister said that although global CPO prices have risen by 47 percent and the US dollar has strengthened by more than 10 percent against the rupiah, FFB prices at the farm level have instead fallen by around 17 percent.
“We have the data. Global CPO prices have risen 47 percent, the dollar has strengthened by more than 10 percent, but FFB prices have actually fallen,” he said.
He urged palm oil companies that have not yet adjusted FFB prices to promptly comply. The government, along with the National Police’s Food Task Force, will investigate around 270–300 companies that have failed to align FFB prices with regional regulations despite rising global CPO prices and exchange rate movements.
Sulaiman stressed that the government will not tolerate practices that harm oil palm farmers, noting that around 15 million Indonesians depend on the sector for their livelihoods.
“We must protect our farmers. There are 15 million oil palm farmers in Indonesia. If global prices rise and the exchange rate strengthens, but farmgate prices fall, that does not make sense,” he said. Antara News
Palm Oil Market Turmoil in Indonesia Creates New Opportunities for Global Suppliers
Indonesia's investigation into hundreds of palm oil companies is reshaping market dynamics and could open new opportunities for competing exporters across Latin America and beyond.
Indonesia, the world's largest palm oil producer and exporter, has launched investigations into hundreds of palm oil companies accused of failing to pass higher prices on to farmers as the market recovered from a recent downturn. The move, announced by Agriculture Minister Amran Sulaiman on June 8, adds new uncertainty to the global vegetable oils market and is drawing attention from traders, food manufacturers, and competing producers worldwide. The development matters because Indonesia accounts for roughly 60% of global palm oil production, meaning policy changes in Jakarta can quickly influence international prices, trade flows, and sourcing decisions.
According to Indonesian authorities, information on approximately 270 to 300 palm oil companies has been submitted to law enforcement agencies for investigation. Officials say the companies may have failed to adequately adjust payments to growers after palm oil prices recovered from a sharp decline triggered by Indonesia's new export policy.
While most of the country's approximately 1,900 palm oil companies have reportedly increased prices paid to farmers, the government is signaling that it intends to closely monitor compliance throughout the supply chain.
While most of the country's approximately 1,900 palm oil companies have reportedly increased prices paid to farmers, the government is signaling that it intends to closely monitor compliance throughout the supply chain. Agro Latam
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Indonesia asks police to probe hundreds of firms on palm oil prices
(June 8): Indonesia’s agriculture minister has asked police to investigate hundreds of palm oil companies that failed to pay farmers more as prices recovered from a slump driven by the country’s new export policy.
The ministry has received reports on 270 to 300 firms that have not adjusted their prices over the past few days and has submitted the information to police, including special crime units, Minister Amran Sulaiman said after meeting with local government officials, the palm oil industry association and farmers groups on Monday.
Sulaiman said he’d asked the police to carry out proper investigations before taking any enforcement action. Most of Indonesia’s around 1,900 palm oil companies have increased the prices paid to farmers, he said.
The move is another instance of the government intervening in the palm oil market after it announced late last month it would take control of some key commodity exports in a sweeping overhaul. Indonesian palm oil prices fell after the policy was announced on fears shipments would slow down and stockpiles would swell, but have since recouped most of the losses.
All parties at the meeting agreed there should be no further decline in Indonesian palm oil prices, Sulaiman said. “There are around 15 million farmers, and we cannot allow them to suffer losses,” he said, adding that the weakening rupiah should be beneficial for exports and farmers.
Prices of fresh fruit bunches were about 3,800 rupiah (US$0.21 or $0.27) a kilogram before the policy was announced on May 20, according to a farmers group. They subsequently fell as low as 1,500 rupiah, before recovering to 3,400 rupiah on Friday. The Edge
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Food task force suspects cartel behind plunge in palm FFB prices
JAKARTA – Indonesia’s National Police Food Task Force suspects cartel activity may be behind the sharp decline in Fresh Fruit Bunch (FFB) prices received by palm oil farmers, despite rising global crude palm oil (CPO) prices.
The head of the task force, Brigadier General Ade Safri Simanjuntak, made the remarks following a meeting with Agriculture Minister Andi Amran Sulaiman, palm oil industry associations, farmer representatives and police officials on Monday (8/6).
According to Ade, the recent decline in FFB prices appears to be an anomaly for the palm oil plantation sector.
“We suspect there are indications of a cartel or unlawful collusion here — a covert agreement aimed at pushing down FFB prices even as global CPO prices have not declined,” Ade said at a press conference.
To follow up on the allegations, Ade said the Food Task Force would work with Indonesia Competition Commission (KPPU), both at the national and regional levels.
The investigation will also involve the Special Criminal Investigation Directorates at regional police departments, which serve as local Food Task Force units.
In addition, the task force is examining trading practices that may have harmed the state, including under-invoicing and under-pricing.
As a result, Ade said law enforcement authorities would not hesitate to take firm action if violations are found.
In an earlier report, Agriculture Minister Amran Sulaiman said the government had identified as many as 300 companies purchasing palm oil FFB at unusually low prices.
Following the findings, Amran said he plans to report all of those companies to law enforcement authorities. (KR/ZH) IDN Financials
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Indonesia cracks down on companies suppressing palm prices
Jakarta (ANTARA) - President Prabowo Subianto has reportedly instructed a 10 percent increase in the price of fresh fruit bunches (FFB) from oil palm, in line with rising global crude palm oil (CPO) prices.
“The president is defending 15 million farmers, saying FFB prices must return to their original levels, and even increase by 10 percent,” Agriculture Minister Andi Amran Sulaiman said here on Monday.
According to him, the directive underscores the importance of protecting the welfare of around 15 million oil palm farmers by restoring FFB prices and encouraging further increases.
He said the adjustment is reasonable, supported by the upward trend in global CPO prices and the strengthening US dollar against the rupiah.
Sulaiman noted that around 70 percent of FFB prices across regions have gradually recovered, and that the government, together with the Food Task Force and police, will ensure full price normalization.
He added that the recent decline in farmgate FFB prices is considered an anomaly, as the commodity should have increased by about 10 percent in line with global market conditions.
The minister said that although global CPO prices have risen by 47 percent and the US dollar has strengthened by more than 10 percent against the rupiah, FFB prices at the farm level have instead fallen by around 17 percent.
“We have the data. Global CPO prices have risen 47 percent, the dollar has strengthened by more than 10 percent, but FFB prices have actually fallen,” he said.
He urged palm oil companies that have not yet adjusted FFB prices to promptly comply. The government, along with the National Police’s Food Task Force, will investigate around 270–300 companies that have failed to align FFB prices with regional regulations despite rising global CPO prices and exchange rate movements.
Sulaiman stressed that the government will not tolerate practices that harm oil palm farmers, noting that around 15 million Indonesians depend on the sector for their livelihoods.
“We must protect our farmers. There are 15 million oil palm farmers in Indonesia. If global prices rise and the exchange rate strengthens, but farmgate prices fall, that does not make sense,” he said. Antara News
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June 08, 2026
Indonesia issues technical regulations to centralise coal, palm oil, ferroalloy exports
By Reuters
JAKARTA, June 8 (Reuters) - Indonesia's Trade Ministry published technical regulations on Monday to bring coal, palm oil, and ferroalloy exports under the control of a central government-owned firm.
All three technical regulations have been in effect since June 1, with exporters of those commodities now obliged to report their export activities to a state firm appointed by the government.
The state secretariat ministry last week issued broader regulations to enable all commodity exports to be channeled through a central government agency.
Here are some key details about the regulation as it relates to palm oil:
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Palm Oil Players Highlight Transparency in Natural Resource Export Management
The substance of PP 24/2026 is considered inconsistent with the President's speech, which aims to prevent under-invoicing and increase state foreign exchange earnings.
JAKARTA, KOMPAS — The implementation of governance for the export of strategic natural resource commodities through PT Danantara Sumberdaya Indonesia (DSI) still leaves several questions unanswered. The pricing mechanism and oversight, which have not been fully explained, make palm oil industry players concerned that additional costs in this new system may ultimately erode export competitiveness and suppress the prices received by palm oil farmers.
The Indonesian Palm Oil Farmers Organization (POPSI) criticized Government Regulation (PP) Number 24 of 2026 concerning the Management of Export of Strategic Natural Resource Commodities.
The General Chairman of the Indonesian Palm Oil Farmers Organization Association (POPSI), Mansuetus Darto, said that the substance of Government Regulation Number 24 of 2026, is actually not in accordance with the President's speech on May 20, 2026, to prevent under-invoicing and increase state foreign exchange earnings. Kompas
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Indonesia asks police to probe hundreds of firms on palm oil prices
(June 8): Indonesia’s agriculture minister has asked police to investigate hundreds of palm oil companies that failed to pay farmers more as prices recovered from a slump driven by the country’s new export policy.
The ministry has received reports on 270 to 300 firms that have not adjusted their prices over the past few days and has submitted the information to police, including special crime units, Minister Amran Sulaiman said after meeting with local government officials, the palm oil industry association and farmers groups on Monday.
Sulaiman said he’d asked the police to carry out proper investigations before taking any enforcement action. Most of Indonesia’s around 1,900 palm oil companies have increased the prices paid to farmers, he said.
The move is another instance of the government intervening in the palm oil market after it announced late last month it would take control of some key commodity exports in a sweeping overhaul. Indonesian palm oil prices fell after the policy was announced on fears shipments would slow down and stockpiles would swell, but have since recouped most of the losses.
All parties at the meeting agreed there should be no further decline in Indonesian palm oil prices, Sulaiman said. “There are around 15 million farmers, and we cannot allow them to suffer losses,” he said, adding that the weakening rupiah should be beneficial for exports and farmers.
Prices of fresh fruit bunches were about 3,800 rupiah (US$0.21 or RM0.85) a kilogram before the policy was announced on May 20, according to a farmers group. They subsequently fell as low as 1,500 rupiah, before recovering to 3,400 rupiah on Friday.
Benchmark palm oil futures in Kuala Lumpur also dropped after the export policy was announced on the prospect of Indonesian producers rushing to sell before the new system fully takes effect. They’ve since recovered from those losses, and climbed as much as 1% to RM4,599 a tonne on Monday after a two-day drop.
Methods for deciding how prices paid to farmers and export prices will be set under the new policy have so far not been explained, said Mansuetus Darto, chairman of the Association of Indonesian Oil Palm Farmers’ Organizations, which represents smaller growers. Farmers are also facing rising fuel costs that could erode their income, he said. The Edge
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Indonesia's Agriculture Ministry probes 300 palm oil firms over FFB prices
Minister of Agriculture Andi Amran Sulaiman announced that around 300 palm oil companies will be investigated for failing to increase fresh fruit bunches (FFB) prices despite market conditions that should have supported higher prices.
"There are approximately 300 companies out of a total of 1,900 operating in the palm oil sector. We will investigate these 300 companies and determine why they have not increased their prices as expected," he said in a press statement on Monday.
The ministry has reported the companies to the National Police Food Task Force as part of efforts to monitor palm oil firms that have not adjusted their FFB purchasing prices at the farmer level.
"This will be investigated immediately. There will be no immediate sanctions because the matter must first go through an inspection process. We will send the letter today, and the investigation will begin," the minister said
Sulaiman noted that the inspection process is necessary to identify the reasons behind the companies' failure to adjust prices.
The government emphasized that the measure is intended to ensure that farmers receive fair prices in line with prevailing market conditions.
Authorities also expressed hope that all companies would promptly comply with the collective agreement to restore FFB prices in order to safeguard the welfare of oil palm farmers.
The minister said that FFB prices vary across regions.
"If the price is Rp3,200 (US$0.17) per kilogram, it should remain at that level, depending on the region. It must comply with the Governor's Regulation," he said.
On Monday, Sulaiman chaired a coordination meeting on efforts to develop and stabilize palm oil FFB prices at the Ministry of Agriculture.
The meeting was attended by representatives of palm oil associations, farmer groups, exporters, the National Police Food Task Force, and other relevant stakeholders. Antara News
Indonesia issues technical regulations to centralise coal, palm oil, ferroalloy exports
By Reuters
JAKARTA, June 8 (Reuters) - Indonesia's Trade Ministry published technical regulations on Monday to bring coal, palm oil, and ferroalloy exports under the control of a central government-owned firm.
All three technical regulations have been in effect since June 1, with exporters of those commodities now obliged to report their export activities to a state firm appointed by the government.
The state secretariat ministry last week issued broader regulations to enable all commodity exports to be channeled through a central government agency.
Here are some key details about the regulation as it relates to palm oil:
- The affected products include crude palm oil, refined, bleached, deodorized palm oil (RBDPO), refined, bleached, and deodorized palm olein (RBDPL), and palm oil residues, the regulation said.
- Palm oil export permits are granted based on compliance with the domestic market obligation whereby exporters must provide supplies for the government's cheap cooking oil programme.
- Export rights can be transferred to the state firm appointed by the government or to other companies by filling in all the details required on the website of Indonesia National Single Window.
- Exports are subject to export duties as regulated by relevant ministries.
- When there is a change in export approval, the state firm appointed will be responsible for the accuracy and compliance of required documents submitted by related companies.
- State firms or exporters that already have permits to export must submit realisation reports every month to the trade ministry, and they must include data about the type of product, quantity, export value, destination country, and tariff posts.
- If realisation reports are not submitted, the firms will be given a warning. If the reports are still not submitted within 30 days of the warning, their export permits may be frozen until they comply.
- The transition period is until December 31, 2026, during which companies can still carry out exports. After December 31, only the state firm appointed by the government will be allowed to export.
- Existing export permits issued prior to this regulation are still valid until they expire.
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Palm Oil Players Highlight Transparency in Natural Resource Export Management
The substance of PP 24/2026 is considered inconsistent with the President's speech, which aims to prevent under-invoicing and increase state foreign exchange earnings.
JAKARTA, KOMPAS — The implementation of governance for the export of strategic natural resource commodities through PT Danantara Sumberdaya Indonesia (DSI) still leaves several questions unanswered. The pricing mechanism and oversight, which have not been fully explained, make palm oil industry players concerned that additional costs in this new system may ultimately erode export competitiveness and suppress the prices received by palm oil farmers.
The Indonesian Palm Oil Farmers Organization (POPSI) criticized Government Regulation (PP) Number 24 of 2026 concerning the Management of Export of Strategic Natural Resource Commodities.
The General Chairman of the Indonesian Palm Oil Farmers Organization Association (POPSI), Mansuetus Darto, said that the substance of Government Regulation Number 24 of 2026, is actually not in accordance with the President's speech on May 20, 2026, to prevent under-invoicing and increase state foreign exchange earnings. Kompas
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Indonesia asks police to probe hundreds of firms on palm oil prices
(June 8): Indonesia’s agriculture minister has asked police to investigate hundreds of palm oil companies that failed to pay farmers more as prices recovered from a slump driven by the country’s new export policy.
The ministry has received reports on 270 to 300 firms that have not adjusted their prices over the past few days and has submitted the information to police, including special crime units, Minister Amran Sulaiman said after meeting with local government officials, the palm oil industry association and farmers groups on Monday.
Sulaiman said he’d asked the police to carry out proper investigations before taking any enforcement action. Most of Indonesia’s around 1,900 palm oil companies have increased the prices paid to farmers, he said.
The move is another instance of the government intervening in the palm oil market after it announced late last month it would take control of some key commodity exports in a sweeping overhaul. Indonesian palm oil prices fell after the policy was announced on fears shipments would slow down and stockpiles would swell, but have since recouped most of the losses.
All parties at the meeting agreed there should be no further decline in Indonesian palm oil prices, Sulaiman said. “There are around 15 million farmers, and we cannot allow them to suffer losses,” he said, adding that the weakening rupiah should be beneficial for exports and farmers.
Prices of fresh fruit bunches were about 3,800 rupiah (US$0.21 or RM0.85) a kilogram before the policy was announced on May 20, according to a farmers group. They subsequently fell as low as 1,500 rupiah, before recovering to 3,400 rupiah on Friday.
Benchmark palm oil futures in Kuala Lumpur also dropped after the export policy was announced on the prospect of Indonesian producers rushing to sell before the new system fully takes effect. They’ve since recovered from those losses, and climbed as much as 1% to RM4,599 a tonne on Monday after a two-day drop.
Methods for deciding how prices paid to farmers and export prices will be set under the new policy have so far not been explained, said Mansuetus Darto, chairman of the Association of Indonesian Oil Palm Farmers’ Organizations, which represents smaller growers. Farmers are also facing rising fuel costs that could erode their income, he said. The Edge
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Indonesia's Agriculture Ministry probes 300 palm oil firms over FFB prices
Minister of Agriculture Andi Amran Sulaiman announced that around 300 palm oil companies will be investigated for failing to increase fresh fruit bunches (FFB) prices despite market conditions that should have supported higher prices.
"There are approximately 300 companies out of a total of 1,900 operating in the palm oil sector. We will investigate these 300 companies and determine why they have not increased their prices as expected," he said in a press statement on Monday.
The ministry has reported the companies to the National Police Food Task Force as part of efforts to monitor palm oil firms that have not adjusted their FFB purchasing prices at the farmer level.
"This will be investigated immediately. There will be no immediate sanctions because the matter must first go through an inspection process. We will send the letter today, and the investigation will begin," the minister said
Sulaiman noted that the inspection process is necessary to identify the reasons behind the companies' failure to adjust prices.
The government emphasized that the measure is intended to ensure that farmers receive fair prices in line with prevailing market conditions.
Authorities also expressed hope that all companies would promptly comply with the collective agreement to restore FFB prices in order to safeguard the welfare of oil palm farmers.
The minister said that FFB prices vary across regions.
"If the price is Rp3,200 (US$0.17) per kilogram, it should remain at that level, depending on the region. It must comply with the Governor's Regulation," he said.
On Monday, Sulaiman chaired a coordination meeting on efforts to develop and stabilize palm oil FFB prices at the Ministry of Agriculture.
The meeting was attended by representatives of palm oil associations, farmer groups, exporters, the National Police Food Task Force, and other relevant stakeholders. Antara News
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June 07, 2026
Indonesia’s crisis of confidence as markets decode Prabowo
INDONESIA spent much of the week ended Jun 7 confronting a question that might have seemed unthinkable a few short years ago: what happens when investors stop believing in South-east Asia’s largest economy?
The answer played out across trading screens around the world and at government offices in Jakarta. Stocks sank to their lowest levels since the pandemic, the rupiah breached the psychologically important 18,000-per-dollar level for the first time and rumours swirled that Finance Minister Purbaya Yudhi Sadewa was on the way out.
By the end of the week, Purbaya and senior government officials were on the defensive. “I’m not the type to quit,” Purbaya said at a state budget briefing on Friday (Jun 5). He was at pains to talk up the country’s fiscal position, saying the nation’s assets remain stable and inflows healthy.
“Optimism about the Indonesian economy remains strong,” he said. “Why are people saying the economy is heading toward a recession when economic stimulus is sufficient, liquidity is sufficient, and credit growth is also sufficient? Don’t be swayed by a single news report.”
But the damage was largely done. Investors increasingly see Indonesia as a market where policy uncertainty, political intervention and execution risks are beginning to outweigh one of the developing world’s most compelling long-term growth stories – a sentiment that has been growing since President Prabowo Subianto took office less than two years ago.
Investors are “concerned about the direction of policymaking in Indonesia,” Jason Tuvey, deputy chief emerging markets economist of Capital Economics, said. “Especially so, after widespread protests in the middle of last year led to the sacking of respected finance minister Sri Mulyani Indrawati. Since then, the government has adopted increasingly populist and interventionist policies.”
Speculation over Purbaya’s departure was not the only thing sending markets into a tailspin. There were also mounting concerns over the government’s economic management, confusion regarding new commodity export rules and a widening corruption investigation involving Prabowo’s flagship US$15 billion free meals programme.
Rising oil prices driven by the conflict in the Middle East are also adding to pressure on Indonesia’s economy, forcing the government to spend more on fuel subsidies while facing higher import costs for crude oil and LPG. Like several of its South-east Asian neighbors, Indonesia imports a significant share of its crude from the region, making it particularly vulnerable to supply disruptions and price shocks.
“Indonesia isn’t alone in Asia in feeling considerable financial market pressure but in its case, the global energy shock has seemingly brought pre-existing concerns about the fiscal outlook and institutional dynamics more sharply into investors’ focus,” said Peter Mumford, who heads the South-east Asia practice of Eurasia Group. “While the government has been sending stronger signals about fiscal discipline recently with the aim of reassuring investors, new policies have created more uncertainty.”
Indonesia’s benchmark stock index has now fallen more than 35 per cent in 2026, making it the worst-performing major equity market tracked by Bloomberg. The rupiah has dropped roughly 14 per cent since Prabowo took office and is Asia’s weakest currency in 2026. Foreign investors have cut holdings of Indonesian sovereign bonds by about 86 trillion rupiah (S$6.7 billion) since August 2025.
The plunging currency is also making the repayment of US dollar-denominated debt a daunting prospect.
According to data compiled by Bloomberg, the government and companies in Indonesia have some US$12.6 billion of foreign currency bonds due in 2027 and US$11.3 billion to US$16.3 billion in each of the four years thereafter. The government has issued more than US$11 billion in foreign-currency notes so far in 2026, the data show. Business Times
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India Must Support Its Oilseed Farmers
From rain-fed fields to absent procurement centres, India's oilseed farmers lack the systems needed to meet the country's ambitious production targets and cut imports.
Mount Abu, Rajasthan: India meets only 44% of its domestic demand for edible oil and spends more than $20 billion a year on imports, a bill that is bound to increase with the war in West Asia disrupting global supply chains and India’s foreign currency reserves under strain.
Already, IndiaSpend’s Food Price Watch has recorded significant year-on-year price increases across different edible oils. Based on the prices of packed oil on May 30, 2026, groundnut oil was up 7% from 2025, mustard oil 12%, palm oil 9%, soya oil 9%, sunflower oil 15% and vanaspati 4%.
Two years ago, the government launched a mission to increase oilseeds production by nearly 80% by the end of this decade, but that assumes a jump in productivity that needs urgent support in the form of farmer outreach, seeds resistant to climatic changes and pests, and an overhaul of the procurement and value addition chains, experts say.
Under the National Mission on Edible Oils, the government has rolled out minimum support prices (MSP) for the procurement of oilseeds, and tariffs to discourage imports and encourage domestic production of edible oils. This includes rapeseed-mustard, groundnut, soybean, sunflower, sesamum, safflower, niger, linseed and palm. While the latter two aren’t covered by the MSP programme, fresh fruit bunches of palm are covered by a baseline price.
To cater to the growing demand for oilseeds, this programme now targets increasing the oilseed area coverage from 29 million hectares (ha) in 2022-23 to 33 million hectares by 2030-31, and the primary oilseed production from 39 million tonnes to 69.7 million tonnes in the same period.
Targeting a 79% increase in production from a 14% increase in acreage presumes a huge jump in productivity, which is up against “a combination of agro-climatic, technological and socio-economic factors, asides genetic limitations”, Ravi Mathur, director of the ICAR-Indian Institute of Oilseeds Research, told IndiaSpend.
“With farmers tending to allocate better land, irrigation, and inputs to cereals and cash crops, oilseeds are often cultivated in residual moisture conditions, on relatively poor soils and in less-favoured production regions,” he said.
In the last three decades, oilseeds acreage across India has increased by more than half, but north and south India saw a drop of 54% and 37%, respectively, offset by a tripling of area under oilseeds in central India and roughly doubling in both west and northeast India.
Low household consumption
India’s per capita consumption of edible oil is widely stated as 19.7 kg per year. However, this consumption spans domestic and industrial uses of oilseeds.
The 2022-23 Household Consumption Expenditure Survey shows that in rural India, the per capita consumption of edible oils is 10.58 kg per year, and in urban India, it is 11.78 kg per year. These figures also include non-food uses in homes such as for lighting diyas, Dattatraya Mahabaleshwar Hegde, former director of the ICAR-Indian Institute of Oilseeds Research, pointed out.
In 2025, Prime Minister Narendra Modi thrice asked his fellow citizens to cut down on their consumption of edible oil for health reasons, in January, February and August. He pointed to rising obesity to suggest that a 10% cut in edible oil consumption can “bring a big change in your health”.
Last month, the Prime Minister repeated his appeal, as part of a list of measures including asking citizens to help conserve foreign exchange reserves by cutting down on purchasing gold and spending on foreign travel, and a shift to public transport, in the face of oil shortages. The WireIN
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Japan turns to used cooking oil to boost sustainable aviation fuel production
Tokyo: Japan is intensifying efforts to collect used cooking oil from households and businesses as it seeks to expand domestic production of sustainable aviation fuel (SAF) and reduce reliance on imported energy sources.
The initiative comes as the country works toward its target of sourcing 10 percent of airline fuel from sustainable alternatives by 2030, a goal that has gained added urgency amid rising energy costs and supply concerns linked to geopolitical tensions in West Asia, The Japan Times reported.
A key part of the strategy is the nationwide “Fry to Fly” programme, a public-private partnership that encourages consumers to donate used cooking oil for conversion into aviation fuel. Around 300 collection points, including supermarkets, are currently participating in the initiative.
Japan views used cooking oil as an important feedstock for SAF because it is relatively affordable and can be sourced domestically. However, limited feedstock availability and insufficient production infrastructure continue to constrain output.
According to government estimates, Japan will require approximately 1.7 million kilolitres of sustainable aviation fuel by 2030 to meet its target. Current domestic SAF production stands at only about 30,000 kilolitres, accounting for just 0.3 percent of total jet fuel consumption.
The challenge underscores the broader difficulties facing the global aviation sector as it seeks to reduce greenhouse gas emissions. While SAF is considered one of the most promising pathways for decarbonising air transport, large-scale production remains limited and costs remain significantly higher than those of conventional aviation fuel.
Japan’s two largest airlines, All Nippon Airways and Japan Airlines, recently acknowledged that progress toward scaling up SAF production has been slower and more difficult than initially anticipated.
Industry experts warn that if domestic production falls short of demand, refiners and airlines may be forced to rely on more expensive imports of SAF or feedstocks, potentially increasing operating costs across the aviation sector.
The issue is not unique to Japan. Many countries pursuing SAF adoption continue to face challenges in securing adequate feedstock supplies and developing commercial-scale production facilities. Even in markets where blending mandates have already been introduced, imported feedstocks remain an important source of supply.
The Japanese government has identified the current year as a crucial period for the industry. Refiners are expected to make final investment decisions on SAF projects by March next year to ensure commercial-scale production capacity is available by 2030.
As the race to decarbonise aviation accelerates, Japan’s growing focus on converting used cooking oil into biofuel highlights both the opportunities and challenges associated with building a domestic sustainable aviation fuel industry. Bioenergy Times
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Palm oil myths fabricated to cripple an invaluable industry to Sri Lanka
The oil palm crop consumes huge volumes of water leading to water shortages and desertification negatively impacting the livelihood of mankind. Rich and fertile soils in our country turns into sand when this crop is grown. No other plant species will grow in these plantations and hence soil will get exposed leading to soil erosion and also leading to losses in biodiversity. Simultaneously, the reptile population increases with this crop threatening the lives of people. Further the growers of this crop find land to do so by removing natural forests. So, this crop is basically devastating our environment and livelihood. After causing all these ill effects what does this crop produce? It’s a vegetable oil that will increase bad cholesterol levels, decrease good cholesterol levels whilst increasing blood sugar levels making consumers of this vegetable oil sick. It is also said that consumers of palm oil will end-up as cancer patients. There are much more such negative narratives but I will stop at this. In a nut shell the argument is that oil palm industry is ruining our natural environment and the health. So, the message to the government is not to lift the ban on oil palm cultivation.
However, knowingly or unknowingly everyone in this world consumes and use significant amounts of palm oil, the produce of this crop. It’s essential for our day-to-day life usage is inevitable. In addition to palm oil being used in domestic cooking, it is used as an ingredient in various food items we consume and in a number of non-food items we use on a daily basis. The source for 40 per cent of the vegetable oil consumed in the world is palm oil. The average per-capita consumption in the world is more than 10 kg per annum. Logically those in Sri Lanka who advocate banning of oil palm cultivation in the country should also do so for importing palm oil. But they do not do that. Importing vegetable oil to the country to meet the deficit in the local demand is a million-dollar industry. Any vegetable oil if not milled and refined using good processing practices will lead to chemical by-products bad for human health. Aflatoxins in coconut oil and MCPDs in palm oil are a few examples. Despite of this risk there are reports to say that inferior quality crude vegetable oils and used vegetable oils are being imported to the country, refined and marketed.
Nakiadeniya estate in Galle had been having palm oil cultivations since 1968. Even after 58 years of this crop there are no reports of drying of soil and shortages of water negatively impacting the day-to-day human life of people in this area. In fact, the ground reality is that those living in the vicinity use water sources within oil palm plantations for their daily water requirement. In Nakiadeniya there are second generation, i.e., replanted oil palm cultivations. These palms are growing vigorously proving that soil is yet healthy and has not turned into sand as believed by a few. One could easily see that there are number of other plant species growing in oil palm cultivated lands. Research undertaken reveals that species richness and density are not different when compared with other plantation crops. Data gathered from hospitals have made it clear that there is no correlation between snake bites and the type of cultivation the estate workers are engaged in. The Regional Plantation Companies (RPCs) manage land leased to them by the Government. These lands have been under plantation crops for more than a century. Oil palm is cultivated only in such land as crop rotation/diversification. It is very obvious that natural forests are not felled by these companies to plant oil palm though some think otherwise. There is no necessity for them to do so considering the large extents of cultivable land available for them.
During the initial development period of the global palm oil industry, in countries such as Malaysia and Indonesia land under natural forests have been cleared for oil palm cultivation. Environmentalists worldwide had vehemently opposed this approach and had launched protests internationally. Currently, the governments of these countries have introduced laws to prevent deforestation for oil palm cultivation. Loss of forest cover, loss of biodiversity, soil degradation, drying of natural springs are a result of deforestation. But such narratives are not relevant to Sri Lanka since land for cultivation of oil palm is sought through crop diversification/rotation. The policy makers should analyse rationally the narratives presented by local environmentalists demanding not to lift the ban on oil palm cultivation. Also, the local environmentalists should not spread false information in the society with other hidden intentions to disrupt development activities that could uplift the economy of the country.
Another school of thought is that lifting the ban on oil palm cultivation will adversely affect the natural rubber industry in the country. It is a fact that the natural rubber extents and production in the country are dwindling rather rapidly.
From 2019 to 2024 the total rubber production in the country has dropped by 16 per cent. The extent under Small Holders (SH) have dropped by 46 per cent whilst the extent under the RPCs have dropped by 29 per cent. It is apparent that the decline in the smallholder sector in the country has largely contributed towards the drop in the rubber production in the country during the period 2019 to 2014. Further data shows that the total rubber production has declined only by 16 per cent during this period whilst the land extents have declined at a much higher percentage, i.e. by around 38 per cent. It appears that owners of low productivity land parcels with no significant economic benefits have moved away from rubber cultivation. Also, the decline in the rubber extents in the country since 2019 cannot be attributed to cultivation oil palm since cultivation in the country was not possible by law. Deterioration in the rubber industry in the country is thus mainly because of low financial gains due to low productivity caused by multiple reasons, stagnant prices and escalating costs.
Undoubtedly the rubber industry in the country needs to be developed. It has immense potential to earn foreign exchange, create employment and contribute to the economic growth of the country. In order to drive investors into cultivating rubber they need to be convinced that a package exists to obtain attractive returns to their investments. The current climatic conditions in the traditional rubber growing areas, Pestalotiopsis leaf disease, white root disease and Tapping Panel Dryness are eroding productivity and profitability in driving the investors away from cultivating natural rubber. There exist alternate strategies to overcome these challenges that has to be implemented by the policy makers.
In the traditional growing areas, with the challenges that currently exists the cycle yield of rubber crop is around 700 kg/ha/annum. With the present market price of Rs. 700 per kg the total revenue per hectare annum is Rs. 490,000. Under the same climatic conditions oil palm under similar environmental conditions yield around 16,000 kg. With the present farm gate price of Rs. 100 per kg the revenue per hectare per year is Rs. 1.6 million. However, in the intermediate zone of the country, where climatic conditions are more conducive for natural rubber, the scenario will be the opposite and rubber will be economically more beneficial. Development of appropriate technology and land use plans considering soil and climatic more appropriate for the crop and giving the investment opportunities to the investor will be the way forward to develop the plantation industry of the country. Sunday TimesLK
Indonesia’s crisis of confidence as markets decode Prabowo
INDONESIA spent much of the week ended Jun 7 confronting a question that might have seemed unthinkable a few short years ago: what happens when investors stop believing in South-east Asia’s largest economy?
The answer played out across trading screens around the world and at government offices in Jakarta. Stocks sank to their lowest levels since the pandemic, the rupiah breached the psychologically important 18,000-per-dollar level for the first time and rumours swirled that Finance Minister Purbaya Yudhi Sadewa was on the way out.
By the end of the week, Purbaya and senior government officials were on the defensive. “I’m not the type to quit,” Purbaya said at a state budget briefing on Friday (Jun 5). He was at pains to talk up the country’s fiscal position, saying the nation’s assets remain stable and inflows healthy.
“Optimism about the Indonesian economy remains strong,” he said. “Why are people saying the economy is heading toward a recession when economic stimulus is sufficient, liquidity is sufficient, and credit growth is also sufficient? Don’t be swayed by a single news report.”
But the damage was largely done. Investors increasingly see Indonesia as a market where policy uncertainty, political intervention and execution risks are beginning to outweigh one of the developing world’s most compelling long-term growth stories – a sentiment that has been growing since President Prabowo Subianto took office less than two years ago.
Investors are “concerned about the direction of policymaking in Indonesia,” Jason Tuvey, deputy chief emerging markets economist of Capital Economics, said. “Especially so, after widespread protests in the middle of last year led to the sacking of respected finance minister Sri Mulyani Indrawati. Since then, the government has adopted increasingly populist and interventionist policies.”
Speculation over Purbaya’s departure was not the only thing sending markets into a tailspin. There were also mounting concerns over the government’s economic management, confusion regarding new commodity export rules and a widening corruption investigation involving Prabowo’s flagship US$15 billion free meals programme.
Rising oil prices driven by the conflict in the Middle East are also adding to pressure on Indonesia’s economy, forcing the government to spend more on fuel subsidies while facing higher import costs for crude oil and LPG. Like several of its South-east Asian neighbors, Indonesia imports a significant share of its crude from the region, making it particularly vulnerable to supply disruptions and price shocks.
“Indonesia isn’t alone in Asia in feeling considerable financial market pressure but in its case, the global energy shock has seemingly brought pre-existing concerns about the fiscal outlook and institutional dynamics more sharply into investors’ focus,” said Peter Mumford, who heads the South-east Asia practice of Eurasia Group. “While the government has been sending stronger signals about fiscal discipline recently with the aim of reassuring investors, new policies have created more uncertainty.”
Indonesia’s benchmark stock index has now fallen more than 35 per cent in 2026, making it the worst-performing major equity market tracked by Bloomberg. The rupiah has dropped roughly 14 per cent since Prabowo took office and is Asia’s weakest currency in 2026. Foreign investors have cut holdings of Indonesian sovereign bonds by about 86 trillion rupiah (S$6.7 billion) since August 2025.
The plunging currency is also making the repayment of US dollar-denominated debt a daunting prospect.
According to data compiled by Bloomberg, the government and companies in Indonesia have some US$12.6 billion of foreign currency bonds due in 2027 and US$11.3 billion to US$16.3 billion in each of the four years thereafter. The government has issued more than US$11 billion in foreign-currency notes so far in 2026, the data show. Business Times
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India Must Support Its Oilseed Farmers
From rain-fed fields to absent procurement centres, India's oilseed farmers lack the systems needed to meet the country's ambitious production targets and cut imports.
Mount Abu, Rajasthan: India meets only 44% of its domestic demand for edible oil and spends more than $20 billion a year on imports, a bill that is bound to increase with the war in West Asia disrupting global supply chains and India’s foreign currency reserves under strain.
Already, IndiaSpend’s Food Price Watch has recorded significant year-on-year price increases across different edible oils. Based on the prices of packed oil on May 30, 2026, groundnut oil was up 7% from 2025, mustard oil 12%, palm oil 9%, soya oil 9%, sunflower oil 15% and vanaspati 4%.
Two years ago, the government launched a mission to increase oilseeds production by nearly 80% by the end of this decade, but that assumes a jump in productivity that needs urgent support in the form of farmer outreach, seeds resistant to climatic changes and pests, and an overhaul of the procurement and value addition chains, experts say.
Under the National Mission on Edible Oils, the government has rolled out minimum support prices (MSP) for the procurement of oilseeds, and tariffs to discourage imports and encourage domestic production of edible oils. This includes rapeseed-mustard, groundnut, soybean, sunflower, sesamum, safflower, niger, linseed and palm. While the latter two aren’t covered by the MSP programme, fresh fruit bunches of palm are covered by a baseline price.
To cater to the growing demand for oilseeds, this programme now targets increasing the oilseed area coverage from 29 million hectares (ha) in 2022-23 to 33 million hectares by 2030-31, and the primary oilseed production from 39 million tonnes to 69.7 million tonnes in the same period.
Targeting a 79% increase in production from a 14% increase in acreage presumes a huge jump in productivity, which is up against “a combination of agro-climatic, technological and socio-economic factors, asides genetic limitations”, Ravi Mathur, director of the ICAR-Indian Institute of Oilseeds Research, told IndiaSpend.
“With farmers tending to allocate better land, irrigation, and inputs to cereals and cash crops, oilseeds are often cultivated in residual moisture conditions, on relatively poor soils and in less-favoured production regions,” he said.
In the last three decades, oilseeds acreage across India has increased by more than half, but north and south India saw a drop of 54% and 37%, respectively, offset by a tripling of area under oilseeds in central India and roughly doubling in both west and northeast India.
Low household consumption
India’s per capita consumption of edible oil is widely stated as 19.7 kg per year. However, this consumption spans domestic and industrial uses of oilseeds.
The 2022-23 Household Consumption Expenditure Survey shows that in rural India, the per capita consumption of edible oils is 10.58 kg per year, and in urban India, it is 11.78 kg per year. These figures also include non-food uses in homes such as for lighting diyas, Dattatraya Mahabaleshwar Hegde, former director of the ICAR-Indian Institute of Oilseeds Research, pointed out.
In 2025, Prime Minister Narendra Modi thrice asked his fellow citizens to cut down on their consumption of edible oil for health reasons, in January, February and August. He pointed to rising obesity to suggest that a 10% cut in edible oil consumption can “bring a big change in your health”.
Last month, the Prime Minister repeated his appeal, as part of a list of measures including asking citizens to help conserve foreign exchange reserves by cutting down on purchasing gold and spending on foreign travel, and a shift to public transport, in the face of oil shortages. The WireIN
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Japan turns to used cooking oil to boost sustainable aviation fuel production
Tokyo: Japan is intensifying efforts to collect used cooking oil from households and businesses as it seeks to expand domestic production of sustainable aviation fuel (SAF) and reduce reliance on imported energy sources.
The initiative comes as the country works toward its target of sourcing 10 percent of airline fuel from sustainable alternatives by 2030, a goal that has gained added urgency amid rising energy costs and supply concerns linked to geopolitical tensions in West Asia, The Japan Times reported.
A key part of the strategy is the nationwide “Fry to Fly” programme, a public-private partnership that encourages consumers to donate used cooking oil for conversion into aviation fuel. Around 300 collection points, including supermarkets, are currently participating in the initiative.
Japan views used cooking oil as an important feedstock for SAF because it is relatively affordable and can be sourced domestically. However, limited feedstock availability and insufficient production infrastructure continue to constrain output.
According to government estimates, Japan will require approximately 1.7 million kilolitres of sustainable aviation fuel by 2030 to meet its target. Current domestic SAF production stands at only about 30,000 kilolitres, accounting for just 0.3 percent of total jet fuel consumption.
The challenge underscores the broader difficulties facing the global aviation sector as it seeks to reduce greenhouse gas emissions. While SAF is considered one of the most promising pathways for decarbonising air transport, large-scale production remains limited and costs remain significantly higher than those of conventional aviation fuel.
Japan’s two largest airlines, All Nippon Airways and Japan Airlines, recently acknowledged that progress toward scaling up SAF production has been slower and more difficult than initially anticipated.
Industry experts warn that if domestic production falls short of demand, refiners and airlines may be forced to rely on more expensive imports of SAF or feedstocks, potentially increasing operating costs across the aviation sector.
The issue is not unique to Japan. Many countries pursuing SAF adoption continue to face challenges in securing adequate feedstock supplies and developing commercial-scale production facilities. Even in markets where blending mandates have already been introduced, imported feedstocks remain an important source of supply.
The Japanese government has identified the current year as a crucial period for the industry. Refiners are expected to make final investment decisions on SAF projects by March next year to ensure commercial-scale production capacity is available by 2030.
As the race to decarbonise aviation accelerates, Japan’s growing focus on converting used cooking oil into biofuel highlights both the opportunities and challenges associated with building a domestic sustainable aviation fuel industry. Bioenergy Times
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Palm oil myths fabricated to cripple an invaluable industry to Sri Lanka
The oil palm crop consumes huge volumes of water leading to water shortages and desertification negatively impacting the livelihood of mankind. Rich and fertile soils in our country turns into sand when this crop is grown. No other plant species will grow in these plantations and hence soil will get exposed leading to soil erosion and also leading to losses in biodiversity. Simultaneously, the reptile population increases with this crop threatening the lives of people. Further the growers of this crop find land to do so by removing natural forests. So, this crop is basically devastating our environment and livelihood. After causing all these ill effects what does this crop produce? It’s a vegetable oil that will increase bad cholesterol levels, decrease good cholesterol levels whilst increasing blood sugar levels making consumers of this vegetable oil sick. It is also said that consumers of palm oil will end-up as cancer patients. There are much more such negative narratives but I will stop at this. In a nut shell the argument is that oil palm industry is ruining our natural environment and the health. So, the message to the government is not to lift the ban on oil palm cultivation.
However, knowingly or unknowingly everyone in this world consumes and use significant amounts of palm oil, the produce of this crop. It’s essential for our day-to-day life usage is inevitable. In addition to palm oil being used in domestic cooking, it is used as an ingredient in various food items we consume and in a number of non-food items we use on a daily basis. The source for 40 per cent of the vegetable oil consumed in the world is palm oil. The average per-capita consumption in the world is more than 10 kg per annum. Logically those in Sri Lanka who advocate banning of oil palm cultivation in the country should also do so for importing palm oil. But they do not do that. Importing vegetable oil to the country to meet the deficit in the local demand is a million-dollar industry. Any vegetable oil if not milled and refined using good processing practices will lead to chemical by-products bad for human health. Aflatoxins in coconut oil and MCPDs in palm oil are a few examples. Despite of this risk there are reports to say that inferior quality crude vegetable oils and used vegetable oils are being imported to the country, refined and marketed.
Nakiadeniya estate in Galle had been having palm oil cultivations since 1968. Even after 58 years of this crop there are no reports of drying of soil and shortages of water negatively impacting the day-to-day human life of people in this area. In fact, the ground reality is that those living in the vicinity use water sources within oil palm plantations for their daily water requirement. In Nakiadeniya there are second generation, i.e., replanted oil palm cultivations. These palms are growing vigorously proving that soil is yet healthy and has not turned into sand as believed by a few. One could easily see that there are number of other plant species growing in oil palm cultivated lands. Research undertaken reveals that species richness and density are not different when compared with other plantation crops. Data gathered from hospitals have made it clear that there is no correlation between snake bites and the type of cultivation the estate workers are engaged in. The Regional Plantation Companies (RPCs) manage land leased to them by the Government. These lands have been under plantation crops for more than a century. Oil palm is cultivated only in such land as crop rotation/diversification. It is very obvious that natural forests are not felled by these companies to plant oil palm though some think otherwise. There is no necessity for them to do so considering the large extents of cultivable land available for them.
During the initial development period of the global palm oil industry, in countries such as Malaysia and Indonesia land under natural forests have been cleared for oil palm cultivation. Environmentalists worldwide had vehemently opposed this approach and had launched protests internationally. Currently, the governments of these countries have introduced laws to prevent deforestation for oil palm cultivation. Loss of forest cover, loss of biodiversity, soil degradation, drying of natural springs are a result of deforestation. But such narratives are not relevant to Sri Lanka since land for cultivation of oil palm is sought through crop diversification/rotation. The policy makers should analyse rationally the narratives presented by local environmentalists demanding not to lift the ban on oil palm cultivation. Also, the local environmentalists should not spread false information in the society with other hidden intentions to disrupt development activities that could uplift the economy of the country.
Another school of thought is that lifting the ban on oil palm cultivation will adversely affect the natural rubber industry in the country. It is a fact that the natural rubber extents and production in the country are dwindling rather rapidly.
From 2019 to 2024 the total rubber production in the country has dropped by 16 per cent. The extent under Small Holders (SH) have dropped by 46 per cent whilst the extent under the RPCs have dropped by 29 per cent. It is apparent that the decline in the smallholder sector in the country has largely contributed towards the drop in the rubber production in the country during the period 2019 to 2014. Further data shows that the total rubber production has declined only by 16 per cent during this period whilst the land extents have declined at a much higher percentage, i.e. by around 38 per cent. It appears that owners of low productivity land parcels with no significant economic benefits have moved away from rubber cultivation. Also, the decline in the rubber extents in the country since 2019 cannot be attributed to cultivation oil palm since cultivation in the country was not possible by law. Deterioration in the rubber industry in the country is thus mainly because of low financial gains due to low productivity caused by multiple reasons, stagnant prices and escalating costs.
Undoubtedly the rubber industry in the country needs to be developed. It has immense potential to earn foreign exchange, create employment and contribute to the economic growth of the country. In order to drive investors into cultivating rubber they need to be convinced that a package exists to obtain attractive returns to their investments. The current climatic conditions in the traditional rubber growing areas, Pestalotiopsis leaf disease, white root disease and Tapping Panel Dryness are eroding productivity and profitability in driving the investors away from cultivating natural rubber. There exist alternate strategies to overcome these challenges that has to be implemented by the policy makers.
In the traditional growing areas, with the challenges that currently exists the cycle yield of rubber crop is around 700 kg/ha/annum. With the present market price of Rs. 700 per kg the total revenue per hectare annum is Rs. 490,000. Under the same climatic conditions oil palm under similar environmental conditions yield around 16,000 kg. With the present farm gate price of Rs. 100 per kg the revenue per hectare per year is Rs. 1.6 million. However, in the intermediate zone of the country, where climatic conditions are more conducive for natural rubber, the scenario will be the opposite and rubber will be economically more beneficial. Development of appropriate technology and land use plans considering soil and climatic more appropriate for the crop and giving the investment opportunities to the investor will be the way forward to develop the plantation industry of the country. Sunday TimesLK
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June 06, 2026
Indonesia issues regulation to bring strategic commodity exports under central control
JAKARTA, June 5 (Reuters) - Indonesia issued a much-anticipated regulation on Friday to bring exports of its strategic commodities under central government control, a move aimed at boosting state earnings and stabilising its rupiah currency.
President Prabowo Subianto announced on May 20 that Indonesia would bring exports of all of its strategic commodities under the control of a new state company, a move that has spooked investors.
The 11-page regulation, published on the website of the state secretariat ministry, was signed on May 20 by Prabowo and outlines the implementation schedule for the new controls.
Palm oil, coal, and ferroalloys can only be exported by a state-owned enterprise, either as "the owner or sole mediator", the regulation said.
"In the export of strategic natural resource commodities by the state-owned export enterprise ... the selling price shall be determined by the state-owned export enterprise," it said, adding that the enterprise can also set margins.
The regulation will be extended to more strategic commodities later, to be decided by relevant ministers.
Exemptions to the new centralised export rules could be granted to business entities that have a contract or agreement with the Indonesian government containing "provisions related at least to investment, divestment, and domestic processing and or refining."
The exemptions will be decided at a coordinating meeting involving related ministers, the regulation said.
The regulation did not specify the state-run entity that will act as the country's sole commodity exporter, but the government's communication agency said in a fact sheet on Friday that "the government has appointed Danantara Sumberdaya Indonesia (DSI) as the designated export SOE."
"Maintaining the confidence of international trading partners and investors is a priority, and every step taken by DSI is designed to reinforce that confidence," the DSI's parent company, Danantara Indonesia said in a statement, adding that export contracts that have already been signed may continue to be carried out.
Once the regulation comes into effect on June 1, commodity exporters will begin channeling shipments through DSI.
Danantara said in the statement that DSI would serve as an "intermediary" to oversee exports "while allowing the commercial relationship between producers and their trading partners to continue."
But after December 31 2026, commodity exports "can only be carried out" by the state entity, according to the regulation.
The Ministry of Trade will issue detailed rules to implement the policy in due course. Reuters
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Weak Rupiah Seen Boosting Indonesia’s Palm Oil Export Earnings
Jakarta. Indonesia’s palm oil industry expects export earnings to rise significantly this year, supported by strong shipment volumes, higher global prices, and the sharp depreciation of the rupiah against the US dollar.
The industry generated $35.87 billion in export revenue in 2025 and believes that figure could be surpassed in 2026 as currency movements improve returns for exporters.
According to data from the Indonesian Palm Oil Association (Gapki), palm oil export revenue rose 10.4% year-on-year to $9.66 billion in the first quarter of 2026, compared with $8.75 billion in the same period a year earlier.
The increase was driven by both higher export volumes and stronger prices. Average palm oil prices reached $1,356 per ton during the January-March period, up from $1,230 per ton in the first quarter of 2025.
“The rupiah’s depreciation is also a blessing. In 2025, around $35 billion in exports translated into about Rp 590 trillion at an exchange rate of roughly Rp 16,000 per dollar. Now, with the exchange rate above Rp 17,000, the value will be even higher,” said Aziz Hidayat, head of plantation affairs at the Indonesian Palm Oil Association.
Industry data show that Indonesia produced 15.56 million tons of palm oil in the first quarter of 2026, up 18.44% from 13.13 million tons in the same period last year.
During the quarter, crude palm oil export volumes increased 11.91% to 8.55 million tons from 7.64 million tons a year earlier. Domestic consumption also grew 7.47% to 6.52 million tons, compared with 6.07 million tons in the first quarter of 2025.
The combination of higher production, rising exports, and stronger domestic demand has strengthened industry confidence that 2026 will outperform last year.
Industry executives remain optimistic even as the government prepares to expand its biofuel program through the introduction of B50, which will require diesel fuel to contain a 50% palm oil-based biodiesel blend.
“Performance through March 2026 shows improvement in both production and exports. If this trend continues through December, the industry’s achievements in 2026 will be better than in 2025,” Aziz said. Jakarta Globe
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MPOGCF strengthens biodiversity conservation in oil palm landscapes
PUTRAJAYA: The Malaysian Palm Oil Green Conservation Foundation (MPOGCF) has intensified efforts to integrate biodiversity conservation into oil palm plantation management to strengthen wildlife coexistence within production landscapes.
Its Conservation and Sustainability Department manager Ahmad Shahdan Kasim said oil palm plantations, forests and wildlife could be managed as a connected landscape through structured planning rather than as separate systems.
He said such an approach allowed plantations to remain productive while improving ecological connectivity and reducing human-wildlife conflict.
"When biodiversity is integrated into plantation planning, coexistence becomes more practical, while operational safety and livelihoods are maintained," he said at the foundation's Biodiversity Forum held here recently.
Ahmad Shahdan said rising human-wildlife conflict required coordinated management across estates, smallholders and relevant agencies, as plantation workers and wildlife increasingly shared the same landscape.
Established in 2021, MPOGCF is continuing conservation work initiated under the Malaysian Palm Oil Wildlife Conservation Fund in 2006. Since then, it has implemented 29 projects involving government agencies, academia, non-governmental organisations and industry players.
The projects fall under four main areas — reforestation, wildlife conservation, biodiversity management and community engagement — covering forest restoration, wildlife corridor development, species monitoring, rescue operations and coexistence programmes.
Key initiatives include habitat restoration in the Lower Kawag, Ulu Segama-Malua Forest Reserve in Lahad Datu, Sabah, carried out with the Kampung Tampenau community, where field observations recorded the return of orangutans to restored areas.
In Sarawak, the foundation worked on peatland rehabilitation, restoring previously unproductive oil palm areas into functioning peat ecosystems to enhance biodiversity and carbon storage.
In Kelantan, it supported the Central Forest Spine Master Plan through the restoration of a 10-hectare forest reserve in Machang, which had been illegally converted to oil palm plantations.
In Sabah, research near the Binsulok-Padas Forest Reserve using 30 camera traps recorded endangered species moving through forest corridors and buffer zones within oil palm landscapes.
Ahmad Shahdan said riparian reserves, forest edges and peat zones should be treated as biodiversity infrastructure, supported by shared data between estates and smallholders to improve land management decisions.
He said studies with Universiti Kebangsaan Malaysia helped translate biodiversity findings into practical plantation guidelines, including maintaining understorey vegetation, native tree species and edge habitats while ensuring operational safety.
He said systematic recording of wildlife sightings and conflict incidents could help identify hotspots early, improve mitigation planning and strengthen Malaysian Sustainable Palm Oil and Roundtable on Sustainable Palm Oil reporting requirements.
MPOGCF has also supported a community-based human-elephant conflict programme in Sungai Ara involving smallholders, including early warning systems, electric fencing and response protocols.
Ahmad Shahdan said the initiative showed that coexistence required both conservation planning and practical risk management on the ground.
On species conservation, MPOGCF has supported elephant and orangutan population surveys in Sabah and worked with the upgraded Wildlife Rescue Unit, now the Elephant Management Unit, which has carried out more than 5,000 wildlife conflict operations.
It also collaborates with the Department of Wildlife and National Parks on Malayan tiger conservation programmes, as well as the Borneo Sun Bear Conservation Centre on sun bear response efforts.
Ahmad Shahdan said visible conservation outcomes were important in strengthening confidence in the sustainability of Malaysian palm oil, adding that biodiversity management must be embedded at estate and landscape levels.
Moving forward, MPOGCF plans to expand landscape monitoring, increase smallholder participation and scale up restoration work involving reforestation, peat rehabilitation and wildlife corridor recovery.
He said the goal was to manage landscapes where people, oil palm, forests and wildlife could coexist. NST
Indonesia issues regulation to bring strategic commodity exports under central control
JAKARTA, June 5 (Reuters) - Indonesia issued a much-anticipated regulation on Friday to bring exports of its strategic commodities under central government control, a move aimed at boosting state earnings and stabilising its rupiah currency.
President Prabowo Subianto announced on May 20 that Indonesia would bring exports of all of its strategic commodities under the control of a new state company, a move that has spooked investors.
The 11-page regulation, published on the website of the state secretariat ministry, was signed on May 20 by Prabowo and outlines the implementation schedule for the new controls.
Palm oil, coal, and ferroalloys can only be exported by a state-owned enterprise, either as "the owner or sole mediator", the regulation said.
"In the export of strategic natural resource commodities by the state-owned export enterprise ... the selling price shall be determined by the state-owned export enterprise," it said, adding that the enterprise can also set margins.
The regulation will be extended to more strategic commodities later, to be decided by relevant ministers.
Exemptions to the new centralised export rules could be granted to business entities that have a contract or agreement with the Indonesian government containing "provisions related at least to investment, divestment, and domestic processing and or refining."
The exemptions will be decided at a coordinating meeting involving related ministers, the regulation said.
The regulation did not specify the state-run entity that will act as the country's sole commodity exporter, but the government's communication agency said in a fact sheet on Friday that "the government has appointed Danantara Sumberdaya Indonesia (DSI) as the designated export SOE."
"Maintaining the confidence of international trading partners and investors is a priority, and every step taken by DSI is designed to reinforce that confidence," the DSI's parent company, Danantara Indonesia said in a statement, adding that export contracts that have already been signed may continue to be carried out.
Once the regulation comes into effect on June 1, commodity exporters will begin channeling shipments through DSI.
Danantara said in the statement that DSI would serve as an "intermediary" to oversee exports "while allowing the commercial relationship between producers and their trading partners to continue."
But after December 31 2026, commodity exports "can only be carried out" by the state entity, according to the regulation.
The Ministry of Trade will issue detailed rules to implement the policy in due course. Reuters
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Weak Rupiah Seen Boosting Indonesia’s Palm Oil Export Earnings
Jakarta. Indonesia’s palm oil industry expects export earnings to rise significantly this year, supported by strong shipment volumes, higher global prices, and the sharp depreciation of the rupiah against the US dollar.
The industry generated $35.87 billion in export revenue in 2025 and believes that figure could be surpassed in 2026 as currency movements improve returns for exporters.
According to data from the Indonesian Palm Oil Association (Gapki), palm oil export revenue rose 10.4% year-on-year to $9.66 billion in the first quarter of 2026, compared with $8.75 billion in the same period a year earlier.
The increase was driven by both higher export volumes and stronger prices. Average palm oil prices reached $1,356 per ton during the January-March period, up from $1,230 per ton in the first quarter of 2025.
“The rupiah’s depreciation is also a blessing. In 2025, around $35 billion in exports translated into about Rp 590 trillion at an exchange rate of roughly Rp 16,000 per dollar. Now, with the exchange rate above Rp 17,000, the value will be even higher,” said Aziz Hidayat, head of plantation affairs at the Indonesian Palm Oil Association.
Industry data show that Indonesia produced 15.56 million tons of palm oil in the first quarter of 2026, up 18.44% from 13.13 million tons in the same period last year.
During the quarter, crude palm oil export volumes increased 11.91% to 8.55 million tons from 7.64 million tons a year earlier. Domestic consumption also grew 7.47% to 6.52 million tons, compared with 6.07 million tons in the first quarter of 2025.
The combination of higher production, rising exports, and stronger domestic demand has strengthened industry confidence that 2026 will outperform last year.
Industry executives remain optimistic even as the government prepares to expand its biofuel program through the introduction of B50, which will require diesel fuel to contain a 50% palm oil-based biodiesel blend.
“Performance through March 2026 shows improvement in both production and exports. If this trend continues through December, the industry’s achievements in 2026 will be better than in 2025,” Aziz said. Jakarta Globe
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MPOGCF strengthens biodiversity conservation in oil palm landscapes
PUTRAJAYA: The Malaysian Palm Oil Green Conservation Foundation (MPOGCF) has intensified efforts to integrate biodiversity conservation into oil palm plantation management to strengthen wildlife coexistence within production landscapes.
Its Conservation and Sustainability Department manager Ahmad Shahdan Kasim said oil palm plantations, forests and wildlife could be managed as a connected landscape through structured planning rather than as separate systems.
He said such an approach allowed plantations to remain productive while improving ecological connectivity and reducing human-wildlife conflict.
"When biodiversity is integrated into plantation planning, coexistence becomes more practical, while operational safety and livelihoods are maintained," he said at the foundation's Biodiversity Forum held here recently.
Ahmad Shahdan said rising human-wildlife conflict required coordinated management across estates, smallholders and relevant agencies, as plantation workers and wildlife increasingly shared the same landscape.
Established in 2021, MPOGCF is continuing conservation work initiated under the Malaysian Palm Oil Wildlife Conservation Fund in 2006. Since then, it has implemented 29 projects involving government agencies, academia, non-governmental organisations and industry players.
The projects fall under four main areas — reforestation, wildlife conservation, biodiversity management and community engagement — covering forest restoration, wildlife corridor development, species monitoring, rescue operations and coexistence programmes.
Key initiatives include habitat restoration in the Lower Kawag, Ulu Segama-Malua Forest Reserve in Lahad Datu, Sabah, carried out with the Kampung Tampenau community, where field observations recorded the return of orangutans to restored areas.
In Sarawak, the foundation worked on peatland rehabilitation, restoring previously unproductive oil palm areas into functioning peat ecosystems to enhance biodiversity and carbon storage.
In Kelantan, it supported the Central Forest Spine Master Plan through the restoration of a 10-hectare forest reserve in Machang, which had been illegally converted to oil palm plantations.
In Sabah, research near the Binsulok-Padas Forest Reserve using 30 camera traps recorded endangered species moving through forest corridors and buffer zones within oil palm landscapes.
Ahmad Shahdan said riparian reserves, forest edges and peat zones should be treated as biodiversity infrastructure, supported by shared data between estates and smallholders to improve land management decisions.
He said studies with Universiti Kebangsaan Malaysia helped translate biodiversity findings into practical plantation guidelines, including maintaining understorey vegetation, native tree species and edge habitats while ensuring operational safety.
He said systematic recording of wildlife sightings and conflict incidents could help identify hotspots early, improve mitigation planning and strengthen Malaysian Sustainable Palm Oil and Roundtable on Sustainable Palm Oil reporting requirements.
MPOGCF has also supported a community-based human-elephant conflict programme in Sungai Ara involving smallholders, including early warning systems, electric fencing and response protocols.
Ahmad Shahdan said the initiative showed that coexistence required both conservation planning and practical risk management on the ground.
On species conservation, MPOGCF has supported elephant and orangutan population surveys in Sabah and worked with the upgraded Wildlife Rescue Unit, now the Elephant Management Unit, which has carried out more than 5,000 wildlife conflict operations.
It also collaborates with the Department of Wildlife and National Parks on Malayan tiger conservation programmes, as well as the Borneo Sun Bear Conservation Centre on sun bear response efforts.
Ahmad Shahdan said visible conservation outcomes were important in strengthening confidence in the sustainability of Malaysian palm oil, adding that biodiversity management must be embedded at estate and landscape levels.
Moving forward, MPOGCF plans to expand landscape monitoring, increase smallholder participation and scale up restoration work involving reforestation, peat rehabilitation and wildlife corridor recovery.
He said the goal was to manage landscapes where people, oil palm, forests and wildlife could coexist. NST
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June 05, 2026
Chinese buyers scoop up Indonesian palm oil before export revamp
More purchases are taking place this week as buyers take advantage of attractive price margins
[JAKARTA] China is snapping up discounted cargoes of Indonesian palm-based cooking oil, accelerating purchases as buyers take advantage of lower prices following Jakarta’s overhaul of its commodity export system.
At least 18, and possibly as many as 30 cargoes of palm olein, have been booked by Chinese buyers in the two weeks since Indonesia announced its new policy, according to people familiar with the deals, with most for June and July delivery.
More purchases are taking place this week as buyers take advantage of attractive price margins after olein futures on China’s Dalian Commodity Exchange rallied, said the people, who asked not to be named discussing private transactions.
The volumes are unusually large, and reflect a scramble to secure cheaply-priced cargoes from Indonesian producers who are rushing to sell before the country’s new export framework is fully implemented, two of the people said. China usually imports about 17-18 cargoes of Indonesian palm oil a month, according to customs data.
Olein, the liquid fraction of palm oil commonly used as cooking oil and in food processing, is one of the most actively traded palm products in Asia. Refined, bleached and deodorised palm olein accounted for the largest share of Indonesia’s palm oil exports last year, according to data from cargo surveyor Intertek Testing Services.
Chinese buying from Indonesia, the world’s biggest supplier, has spiked since President Prabowo Subianto unveiled plans to establish government control of commodities exports late last month. Exporters are required to begin reporting sales from June 1, but can continue to ship product overseas by themselves in a transition phase until Jan one next year at the latest.
https://www.businesstimes.com.sg/international/asean/chinese-buyers-scoop-indonesian-palm-oil-export-revamp
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China’s Growing Footprint in Ghana’s Palm Oil Industry
Beijing’s quiet investments are reshaping farms, processing plants, and export markets across Ghana’s oil palm belt.
While public attention often focuses on China’s involvement in Ghana’s roads, ports, and energy infrastructure, a less visible but increasingly significant investment trend is taking shape in the country’s agricultural sector. Over the past three years, Chinese companies and traders have invested millions of dollars in Ghana’s palm oil industry, targeting plantations, processing facilities, and export networks.
The strategy reflects China’s broader effort to secure reliable supplies for its vast edible oil market while positioning Ghana as a key palm oil production and processing hub in West Africa.
Investment Flowing into Farms, Mills and Trade
Unlike many large-scale infrastructure projects financed through government agreements, much of the investment in Ghana’s palm oil sector has come from private Chinese capital.
Chinese firms, particularly from provinces such as Guangdong and Hainan, have reportedly entered lease agreements for thousands of acres of land in Ghana’s Western, Central and Bono regions. Rather than pursuing outright ownership, many companies are adopting contract farming and outgrower models. Under these arrangements, local farmers receive seedlings, fertilizer, technical support and guaranteed markets, while investors secure a steady supply of fresh fruit bunches for processing.
Investment has also expanded into milling and refining operations. Since 2023, several new processing facilities equipped with Chinese technology and backed by Chinese capital have emerged in key oil palm-producing areas, including Ellembelle, Twifo-Praso and Benso. Industry estimates suggest investments ranging between $80 million and $120 million.
These facilities are designed not only to process crude palm oil but also to produce refined, bleached and deodorized (RBD) palm oil, a higher-value product with stronger export potential.
At the same time, Chinese trading companies have strengthened their presence at Tema Port, where they have become important buyers and exporters of both crude and refined palm oil destined for markets in China, India and the Middle East. Investments in storage infrastructure and logistics networks are also improving the efficiency of the supply chain.
Why Ghana Has Become Attractive
Several factors explain the growing interest in Ghana’s palm oil sector.
First is supply diversification. China imports more than seven million tonnes of palm oil annually, with the overwhelming majority sourced from Indonesia and Malaysia. As those countries increasingly prioritize domestic biodiesel production and impose export-related restrictions, Chinese buyers are seeking alternative suppliers. Ghana’s substantial oil palm resources and significant room for expansion make it an attractive option.
Second is Ghana’s strategic position within the African Continental Free Trade Area (AfCFTA). As host of the AfCFTA Secretariat, Ghana offers investors access to a rapidly integrating African market. Palm oil processed in Ghana can potentially serve consumers across West Africa and beyond under more favorable trade arrangements.
Third is competitiveness. Although Ghana’s yields remain below those achieved in Southeast Asia, lower land and labor costs, combined with improved seedlings, mechanization and modern farming practices, offer opportunities for significant productivity gains.
Potential Benefits for Ghana
If managed effectively, the influx of investment could deliver substantial economic benefits.
The sector has strong job creation potential. Modern palm oil mills can generate hundreds of direct jobs while supporting thousands of smallholder farmers through outgrower schemes. Access to finance, inputs and guaranteed markets can improve incomes and reduce uncertainty for rural producers. Modern Ghana
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Rising Demand and Falling Stocks Force Cameroon Back Into Palm Oil Imports
Cameroon is preparing to import additional palm oil during the second half of 2026 to prevent supply shortages in the domestic market.
The decision emerged from consultations held on June 2 at the Ministry of Trade, bringing together government agencies, producers, industrial users, and representatives of the industry.
The meeting, chaired by Trade Minister Luc Magloire Mbarga Atangana, took place against a backdrop of growing pressure on domestic supply. According to figures presented during the discussions, national stocks have fallen below 10,000 tons, even as demand from households, refineries, soap manufacturers, and other industrial users remains high.
In the short term, imports are viewed as a safeguard to stabilize the market. However, the move comes at a difficult time internationally.
Palm oil prices remain under pressure, supported by demand from the biodiesel sector and broader tensions across vegetable oil markets. Dorab Mistry, director of Godrej International, expects prices to continue rising and has projected that Malaysian palm oil futures could reach around 5,200 ringgits per ton by mid-July, according to estimates reported by Reuters.
For Cameroonian authorities, however, imports cannot be considered a long-term solution.
The June 2 discussions once again highlighted the sector’s structural weaknesses, including insufficient local production, an uneven distribution of value across the supply chain, traceability challenges, weak oversight of operators, and the persistence of informal bulk palm oil trade.
The latter remains a particular concern for authorities. Much of the bulk trade operates outside formal channels, making it difficult to track actual supply volumes and depriving the government of tax revenue. It also contributes to distortions in a market already strained by the gap between domestic production and industrial demand.
To address these challenges, stakeholders agreed to establish technical committees tasked with monitoring priority reforms. The objective is to strengthen coordination among producers, processors, and industrial users, improve assessments of operators’ actual production capacity, and streamline supply chains.
The issue extends well beyond the availability of a common consumer product.
Palm oil is a strategic raw material for the food-processing industry, soap manufacturing, cosmetics production, and several other industrial sectors. Any prolonged disruption in supply affects production costs, consumer prices, and industrial activity at a time when many factories are already operating below capacity.
A Structural Deficit Measured in Hundreds of Thousands of Tons
The current shortage reflects a long-standing structural deficit in the sector.
Industry estimates regularly place the country’s annual supply gap between 200,000 and 300,000 tons. The shortfall is particularly damaging for refineries and soap manufacturers, many of which operate at only a fraction of their installed capacity because of limited access to raw materials.
Against this backdrop, palm oil company Opalm signed a CFA45 billion investment agreement with the Cameroonian government in December 2025.
The project includes the construction of five palm oil production facilities across several agricultural regions of the country, with the goal of increasing domestic supply for industrial users.
According to figures released as part of the program, Opalm aims to add about 108,000 tons of palm oil production annually. Based on an estimated deficit of 300,000 tons, that contribution would cover slightly more than one-third of the country’s unmet needs.
While the project could significantly reduce dependence on imports, it would not fully eliminate the supply imbalance.
Until those investments materialize, Cameroon remains exposed to a rising import bill.
Data published by the National Institute of Statistics show that imports of crude and refined oils increased from 69,719 tons in 2024 to 130,564 tons in 2025.
In value terms, imports rose from CFA49.9 billion to CFA92.2 billion, an increase of 84.8%.
The figures illustrate the growing pressure that the domestic supply deficit is placing on the country’s trade balance.
In the short term, imports should help ease tensions in the local market. Over the longer term, however, the key challenge remains rebuilding a domestic supply base that is large enough, competitive enough, and better organized to reduce the country’s exposure to international price swings and supply constraints.
Amina Malloum/ Business in Cameroon
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Chinese buyers scoop up Indonesian palm oil before export revamp
More purchases are taking place this week as buyers take advantage of attractive price margins
[JAKARTA] China is snapping up discounted cargoes of Indonesian palm-based cooking oil, accelerating purchases as buyers take advantage of lower prices following Jakarta’s overhaul of its commodity export system.
At least 18, and possibly as many as 30 cargoes of palm olein, have been booked by Chinese buyers in the two weeks since Indonesia announced its new policy, according to people familiar with the deals, with most for June and July delivery.
More purchases are taking place this week as buyers take advantage of attractive price margins after olein futures on China’s Dalian Commodity Exchange rallied, said the people, who asked not to be named discussing private transactions.
The volumes are unusually large, and reflect a scramble to secure cheaply-priced cargoes from Indonesian producers who are rushing to sell before the country’s new export framework is fully implemented, two of the people said. China usually imports about 17-18 cargoes of Indonesian palm oil a month, according to customs data.
Olein, the liquid fraction of palm oil commonly used as cooking oil and in food processing, is one of the most actively traded palm products in Asia. Refined, bleached and deodorised palm olein accounted for the largest share of Indonesia’s palm oil exports last year, according to data from cargo surveyor Intertek Testing Services.
Chinese buying from Indonesia, the world’s biggest supplier, has spiked since President Prabowo Subianto unveiled plans to establish government control of commodities exports late last month. Exporters are required to begin reporting sales from June 1, but can continue to ship product overseas by themselves in a transition phase until Jan one next year at the latest.
https://www.businesstimes.com.sg/international/asean/chinese-buyers-scoop-indonesian-palm-oil-export-revamp
--------
China’s Growing Footprint in Ghana’s Palm Oil Industry
Beijing’s quiet investments are reshaping farms, processing plants, and export markets across Ghana’s oil palm belt.
While public attention often focuses on China’s involvement in Ghana’s roads, ports, and energy infrastructure, a less visible but increasingly significant investment trend is taking shape in the country’s agricultural sector. Over the past three years, Chinese companies and traders have invested millions of dollars in Ghana’s palm oil industry, targeting plantations, processing facilities, and export networks.
The strategy reflects China’s broader effort to secure reliable supplies for its vast edible oil market while positioning Ghana as a key palm oil production and processing hub in West Africa.
Investment Flowing into Farms, Mills and Trade
Unlike many large-scale infrastructure projects financed through government agreements, much of the investment in Ghana’s palm oil sector has come from private Chinese capital.
Chinese firms, particularly from provinces such as Guangdong and Hainan, have reportedly entered lease agreements for thousands of acres of land in Ghana’s Western, Central and Bono regions. Rather than pursuing outright ownership, many companies are adopting contract farming and outgrower models. Under these arrangements, local farmers receive seedlings, fertilizer, technical support and guaranteed markets, while investors secure a steady supply of fresh fruit bunches for processing.
Investment has also expanded into milling and refining operations. Since 2023, several new processing facilities equipped with Chinese technology and backed by Chinese capital have emerged in key oil palm-producing areas, including Ellembelle, Twifo-Praso and Benso. Industry estimates suggest investments ranging between $80 million and $120 million.
These facilities are designed not only to process crude palm oil but also to produce refined, bleached and deodorized (RBD) palm oil, a higher-value product with stronger export potential.
At the same time, Chinese trading companies have strengthened their presence at Tema Port, where they have become important buyers and exporters of both crude and refined palm oil destined for markets in China, India and the Middle East. Investments in storage infrastructure and logistics networks are also improving the efficiency of the supply chain.
Why Ghana Has Become Attractive
Several factors explain the growing interest in Ghana’s palm oil sector.
First is supply diversification. China imports more than seven million tonnes of palm oil annually, with the overwhelming majority sourced from Indonesia and Malaysia. As those countries increasingly prioritize domestic biodiesel production and impose export-related restrictions, Chinese buyers are seeking alternative suppliers. Ghana’s substantial oil palm resources and significant room for expansion make it an attractive option.
Second is Ghana’s strategic position within the African Continental Free Trade Area (AfCFTA). As host of the AfCFTA Secretariat, Ghana offers investors access to a rapidly integrating African market. Palm oil processed in Ghana can potentially serve consumers across West Africa and beyond under more favorable trade arrangements.
Third is competitiveness. Although Ghana’s yields remain below those achieved in Southeast Asia, lower land and labor costs, combined with improved seedlings, mechanization and modern farming practices, offer opportunities for significant productivity gains.
Potential Benefits for Ghana
If managed effectively, the influx of investment could deliver substantial economic benefits.
The sector has strong job creation potential. Modern palm oil mills can generate hundreds of direct jobs while supporting thousands of smallholder farmers through outgrower schemes. Access to finance, inputs and guaranteed markets can improve incomes and reduce uncertainty for rural producers. Modern Ghana
---------
Rising Demand and Falling Stocks Force Cameroon Back Into Palm Oil Imports
Cameroon is preparing to import additional palm oil during the second half of 2026 to prevent supply shortages in the domestic market.
The decision emerged from consultations held on June 2 at the Ministry of Trade, bringing together government agencies, producers, industrial users, and representatives of the industry.
The meeting, chaired by Trade Minister Luc Magloire Mbarga Atangana, took place against a backdrop of growing pressure on domestic supply. According to figures presented during the discussions, national stocks have fallen below 10,000 tons, even as demand from households, refineries, soap manufacturers, and other industrial users remains high.
In the short term, imports are viewed as a safeguard to stabilize the market. However, the move comes at a difficult time internationally.
Palm oil prices remain under pressure, supported by demand from the biodiesel sector and broader tensions across vegetable oil markets. Dorab Mistry, director of Godrej International, expects prices to continue rising and has projected that Malaysian palm oil futures could reach around 5,200 ringgits per ton by mid-July, according to estimates reported by Reuters.
For Cameroonian authorities, however, imports cannot be considered a long-term solution.
The June 2 discussions once again highlighted the sector’s structural weaknesses, including insufficient local production, an uneven distribution of value across the supply chain, traceability challenges, weak oversight of operators, and the persistence of informal bulk palm oil trade.
The latter remains a particular concern for authorities. Much of the bulk trade operates outside formal channels, making it difficult to track actual supply volumes and depriving the government of tax revenue. It also contributes to distortions in a market already strained by the gap between domestic production and industrial demand.
To address these challenges, stakeholders agreed to establish technical committees tasked with monitoring priority reforms. The objective is to strengthen coordination among producers, processors, and industrial users, improve assessments of operators’ actual production capacity, and streamline supply chains.
The issue extends well beyond the availability of a common consumer product.
Palm oil is a strategic raw material for the food-processing industry, soap manufacturing, cosmetics production, and several other industrial sectors. Any prolonged disruption in supply affects production costs, consumer prices, and industrial activity at a time when many factories are already operating below capacity.
A Structural Deficit Measured in Hundreds of Thousands of Tons
The current shortage reflects a long-standing structural deficit in the sector.
Industry estimates regularly place the country’s annual supply gap between 200,000 and 300,000 tons. The shortfall is particularly damaging for refineries and soap manufacturers, many of which operate at only a fraction of their installed capacity because of limited access to raw materials.
Against this backdrop, palm oil company Opalm signed a CFA45 billion investment agreement with the Cameroonian government in December 2025.
The project includes the construction of five palm oil production facilities across several agricultural regions of the country, with the goal of increasing domestic supply for industrial users.
According to figures released as part of the program, Opalm aims to add about 108,000 tons of palm oil production annually. Based on an estimated deficit of 300,000 tons, that contribution would cover slightly more than one-third of the country’s unmet needs.
While the project could significantly reduce dependence on imports, it would not fully eliminate the supply imbalance.
Until those investments materialize, Cameroon remains exposed to a rising import bill.
Data published by the National Institute of Statistics show that imports of crude and refined oils increased from 69,719 tons in 2024 to 130,564 tons in 2025.
In value terms, imports rose from CFA49.9 billion to CFA92.2 billion, an increase of 84.8%.
The figures illustrate the growing pressure that the domestic supply deficit is placing on the country’s trade balance.
In the short term, imports should help ease tensions in the local market. Over the longer term, however, the key challenge remains rebuilding a domestic supply base that is large enough, competitive enough, and better organized to reduce the country’s exposure to international price swings and supply constraints.
Amina Malloum/ Business in Cameroon
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June 04, 2026
Indonesian Wealth Fund Danantara Plans Dollar Bond Offering
Danantara, the Indonesian sovereign wealth fund that has emerged to take an outsized role in Southeast Asia’s largest economy, hired banks for a potential dollar bond sale, in a test of investor confidence.
(Bloomberg) — Danantara, the Indonesian sovereign wealth fund that has emerged to take an outsized role in Southeast Asia’s largest economy, hired banks for a potential dollar bond sale, in a test of investor confidence.
Indonesia’s President Prabowo Subianto established Danantara last year in a bid to improve the efficiency of Indonesia’s powerful state-owned enterprises and to attract foreign capital. The fund, which boasts assets of about $1 trillion, was at the center of Prabowo’s surprise announcement last month to centralize exports of key commodities. A unit of Danantara was designated as the sole export channel for coal, palm oil and ferroalloys.
Danantara hired banks to arrange a series of fixed income investor meetings and calls in Asia, Europe and the US starting Wednesday, according to people familiar with the matter, who asked not to be identified discussing private matters. Danantara didn’t immediately respond to requests for comment.
The potential offering comes amid the growing concern among investors about some of Prabowo growth initiatives after Moody’s and Fitch Ratings both cut their credit outlooks for the nation to negative. Prabowo said earlier this year that he would like Danantara to achieve at least a 5% return on assets, or $50 billion a year based on its self-estimated total assets.
In the bond offering memorandum, Danantara said the “government is not guaranteeing” any of its obligations in respect of the notes. Proceeds from the offering will be used for general corporate purposes, including investments and refinancing of outstanding borrowings, according to the document.
Danantara hired Citigroup, DBS Bank, HSBC, Mandiri Securities and Standard Chartered Bank as joint lead managers and joint bookrunners to arrange the fixed income investor meetings and calls, according to people familiar. The notes would be offered via Danantara Investment Management, the investment arm of the wealth fund. The mandate doesn’t mean a deal will be concluded.
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Malaysian palm oil exports to face pressure from Indonesia’s commodity export overhaul
Indonesian palm oil is currently more attractively priced than Malaysian supplies
MALAYSIAN palm oil exports could tumble for a third straight month in June if buyers favour cheaper Indonesian supplies as Jakarta’s overhaul of commodity shipments sparks a push to move cargoes before the new rules fully take hold.
An Indonesian plan to take control of exports began on Jun 1, with producers expected to start submitting sales figures via newly formed state-owned firm PT Danantara Sumberdaya Indonesia. The system is still in a transition phase, and companies are allowed to keep handling transactions until Danantara takes over specific export activities as early as September, or by Jan 1, 2027, at the latest, senior officials said in the week ended May 31.
There were initial expectations the new Indonesian rules would divert demand to Malaysia, but that has not happened so far because key importers, especially those in India, had already made ample purchases in the first quarter, according to Paramalingam Supramaniam, a director at Selangor-based brokerage Pelindung Bestari.
“If Indonesia starts pushing out more exports until the new policy is fully implemented, that would intensify competition with Malaysia and weigh on its shipments,” he said.
A shift to purchases from Indonesian could put pressure on Malaysian palm oil futures, which have been hit by sluggish exports and softer energy prices that have reduced the tropical oil’s appeal for biofuel. Indonesian palm oil is currently more attractively priced than Malaysian supplies, giving the country room to capture market share, according to traders.
Malaysian exports fell 6.2 per cent in May from a month earlier to 1.22 million tonnes, according to the median of 11 estimates in a Bloomberg survey of plantation executives, traders and analysts. That is the weakest level since February, and follows a 14 per cent drop in April.
Inventories rose 2.2 per cent to 2.36 million tonnes, according to the poll, while crude palm oil production fell 4.9 per cent to 1.55 million tonnes. The Malaysian Palm Oil Board is scheduled to publish official figures on Jun 10.
Not everyone is convinced that exports will remain weak.
“For June, exports will recover mainly due to easing prices in May prompting major importers to restock after two previous months of a slowdown in buying,” said Sathia Varqa, a senior analyst with Fastmarkets Palm Oil Analytics in Singapore. “Uncertainty over the Indonesian export policy could also propel increased purchases from Malaysia.” Business Times
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US Slaps 10% Forced Labor Tariff on Indonesia
Jakarta. The US has slapped an additional 10% tariff on Indonesia for letting imported goods linked with forced labor enter the country.
In March, the Donald Trump 2.0 government launched a forced labor probe into Indonesia and dozens of other countries. On Tuesday Washington time, the US declared new tariffs of either 10% or 12.5%. The higher rate is for countries that have failed to not only impose, but also effectively enforce a prohibition on imported goods made with forced labor. Indonesia is subject to a lower rate for having bans in place, but lacks effective enforcement.
US Trade Representative Jamieson Greer slammed the failures as “unacceptable”.
“This creates a dynamic where American workers are forced to compete globally on an unlevel playing field,” Greer said.
Haryo Limanseto, the spokesperson at the Coordinating Ministry for Economic Affairs, told the Jakarta Globe that these were still interim investigations. Indonesia plans to submit written comments and join the upcoming public hearings.
“The Indonesian government remains committed to respecting human rights, labor protection, and implementing labor principles that are consistent with international standards,” Haryo said.
Jakarta also plans to engage in talks with the US side “in a constructive manner” while strengthening the implementation of import regulations.
Indonesia already has a tariff deal with the US government, although the pact remains subject to ratification. In its report, Washington wrote that Jakarta had “taken on commitments” on forced labor import prohibition under the pact. The latest tariff salvo is also just weeks ahead of the July 24 expiration of a 10% temporary tariff. Jakarta Globe
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Malaysia to retain palm oil market position despite EU–Indonesia trade agreement momentum
Malaysia is expected to maintain its competitive position in the global palm oil market despite accelerating progress in the Indonesia–EU trade agreement. While Indonesia, the world’s largest palm oil exporter, has concluded negotiations on a free trade agreement with the EU and is moving toward ratification, analysts say the competitive landscape remains more balanced than a simple first-mover advantage suggests.
Indonesia exported an estimated 23.6 mln tonnes of palm oil worth $24.4 bln in 2025, while Malaysia shipped 17.3 mln tonnes. However, Malaysia continues to hold a strong position in higher-value segments of the market, with total export earnings estimated at around $30 bln, reflecting its focus on refined and certified products.
A key factor shaping competition is compliance with the EU Deforestation Regulation (EUDR), where sustainability certification plays an increasingly important role alongside tariffs. Malaysia has already secured recognition of its Malaysian Sustainable Palm Oil (MSPO) certification in discussions with the EU, strengthening its regulatory standing regardless of the FTA timeline.
At the same time, Indonesia’s earlier progress in finalizing the trade agreement could improve its price competitiveness through potential tariff advantages. Currency dynamics may also play a role, with expectations of a stronger Malaysian ringgit and a relatively weaker Indonesian rupiah in 2026 influencing export pricing.
Despite these pressures, analysts believe Malaysia will retain a degree of competitive resilience, supported by its established sustainability framework and strong positioning in premium palm oil markets.
For almost 30 years of expertise in the agri markets, UkrAgroConsult has accumulated an extensive database, which became the basis of the platform AgriSupp.
It is a multi-functional online platform with market intelligence for grains and oilseeds that enables to get access to daily operational information on the Black Sea & Danube markets, analytical reports, historical data. UKR Agroconsult
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FAO issues forest monitoring good practices for tree crop commodities and smallholders
ROME – The Food and Agriculture Organization of the United Nations (FAO) today published new guidance on forest monitoring, including on how to map and monitor tree-based agricultural commodities such as those produced in agroforestry systems. Launched today at the GeoField 2026 Convening, the Forest monitoring good practices: mapping tree crop commodities provides a comprehensive framework for using earth observation and geospatial data to identify the presence of crops like cocoa, coffee, rubber and palm oil.
From satellite images, a shaded cocoa plantation or a coffee agroforestry system can look nearly identical to a natural forest. The new guidance, intended for use by a broad range of actors, including national governments, private sector operators, civil society and researchers, sets out a methodology for gathering accurate data that reliably distinguishes between natural forests and farms cultivating tree crops.
“This technical publication comes at an important moment as international markets increasingly seek assurance that agricultural products are not linked to forest loss,” said Zhimin Wu, FAO Assistant Director-General and Director of the Forestry Division.
Why mapping tree crop commodities matters
While cereal crops such as wheat, maize and rice form the backbone of the global food trade, tree crops like cocoa, coffee and palm oil are among the highest value agricultural products traded globally.
Tree crop commodities are mostly grown in tropical countries and smallholder family farmers produce 80 per cent of the world’s coffee. In countries like Ghana and Côte d’Ivoire, cocoa is a primary source of income for most smallholder families.
Yet smallholders often manage small, irregularly shaped plots hidden under dense forest canopies, and without accurate mapping data, these producers are at risk of being excluded from global markets that are increasingly requesting transparent and responsible sourcing information.
Key recommendations
The good practices outline a sophisticated multi-step process for generating reliable commodity maps. Rather than relying on a single data source, the FAO recommends a "convergence of evidence" approach that integrates satellite imagery with ground-level intelligence.
Key recommendations include moving beyond traditional optical satellite images, which are often blocked by clouds in tropical regions and instead combining optical data with other sensors to "see through" weather patterns and measure the physical structure and height of vegetation.
The framework highlights the use of advanced algorithms and artificial intelligence to identify complex patterns in how crops are planted, helping to differentiate between the random growth of a forest and the managed rows or clusters of a farm.
It recommends verifying mapping produced with satellite imagery and radar by comparing it with reference data such as high-resolution drone imagery, field data and input from local experts.
It advocates for the use of standardised definitions for land cover, land use and forests so that all data is globally compatible and, for transparency, providing metadata with every map to explain how it was made, what the limitations may be and ensuring data sharing complies with privacy laws.
The publication, co-authored by a large span of actors from the public and private sector, makes the case for publicly available open data to support transparent and sustainable supply chains.
Good practices on forest monitoring: inclusive smallholder data governance
A second new FAO publication, Forest monitoring good practices: inclusive smallholder data governance, was also launched today at the GeoField 2026 Convening.
The publication provides an overview of the smallholder data landscape, including what, why and how data is collected, gathered and managed.
The publication explains the main risks and inequalities smallholder farmers face in how their data is collected and used, and recommends fairer data practices, shared standards, farmer-focused digital systems and better support to help farmers understand and manage their data. FAO
Indonesian Wealth Fund Danantara Plans Dollar Bond Offering
Danantara, the Indonesian sovereign wealth fund that has emerged to take an outsized role in Southeast Asia’s largest economy, hired banks for a potential dollar bond sale, in a test of investor confidence.
(Bloomberg) — Danantara, the Indonesian sovereign wealth fund that has emerged to take an outsized role in Southeast Asia’s largest economy, hired banks for a potential dollar bond sale, in a test of investor confidence.
Indonesia’s President Prabowo Subianto established Danantara last year in a bid to improve the efficiency of Indonesia’s powerful state-owned enterprises and to attract foreign capital. The fund, which boasts assets of about $1 trillion, was at the center of Prabowo’s surprise announcement last month to centralize exports of key commodities. A unit of Danantara was designated as the sole export channel for coal, palm oil and ferroalloys.
Danantara hired banks to arrange a series of fixed income investor meetings and calls in Asia, Europe and the US starting Wednesday, according to people familiar with the matter, who asked not to be identified discussing private matters. Danantara didn’t immediately respond to requests for comment.
The potential offering comes amid the growing concern among investors about some of Prabowo growth initiatives after Moody’s and Fitch Ratings both cut their credit outlooks for the nation to negative. Prabowo said earlier this year that he would like Danantara to achieve at least a 5% return on assets, or $50 billion a year based on its self-estimated total assets.
In the bond offering memorandum, Danantara said the “government is not guaranteeing” any of its obligations in respect of the notes. Proceeds from the offering will be used for general corporate purposes, including investments and refinancing of outstanding borrowings, according to the document.
Danantara hired Citigroup, DBS Bank, HSBC, Mandiri Securities and Standard Chartered Bank as joint lead managers and joint bookrunners to arrange the fixed income investor meetings and calls, according to people familiar. The notes would be offered via Danantara Investment Management, the investment arm of the wealth fund. The mandate doesn’t mean a deal will be concluded.
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Malaysian palm oil exports to face pressure from Indonesia’s commodity export overhaul
Indonesian palm oil is currently more attractively priced than Malaysian supplies
MALAYSIAN palm oil exports could tumble for a third straight month in June if buyers favour cheaper Indonesian supplies as Jakarta’s overhaul of commodity shipments sparks a push to move cargoes before the new rules fully take hold.
An Indonesian plan to take control of exports began on Jun 1, with producers expected to start submitting sales figures via newly formed state-owned firm PT Danantara Sumberdaya Indonesia. The system is still in a transition phase, and companies are allowed to keep handling transactions until Danantara takes over specific export activities as early as September, or by Jan 1, 2027, at the latest, senior officials said in the week ended May 31.
There were initial expectations the new Indonesian rules would divert demand to Malaysia, but that has not happened so far because key importers, especially those in India, had already made ample purchases in the first quarter, according to Paramalingam Supramaniam, a director at Selangor-based brokerage Pelindung Bestari.
“If Indonesia starts pushing out more exports until the new policy is fully implemented, that would intensify competition with Malaysia and weigh on its shipments,” he said.
A shift to purchases from Indonesian could put pressure on Malaysian palm oil futures, which have been hit by sluggish exports and softer energy prices that have reduced the tropical oil’s appeal for biofuel. Indonesian palm oil is currently more attractively priced than Malaysian supplies, giving the country room to capture market share, according to traders.
Malaysian exports fell 6.2 per cent in May from a month earlier to 1.22 million tonnes, according to the median of 11 estimates in a Bloomberg survey of plantation executives, traders and analysts. That is the weakest level since February, and follows a 14 per cent drop in April.
Inventories rose 2.2 per cent to 2.36 million tonnes, according to the poll, while crude palm oil production fell 4.9 per cent to 1.55 million tonnes. The Malaysian Palm Oil Board is scheduled to publish official figures on Jun 10.
Not everyone is convinced that exports will remain weak.
“For June, exports will recover mainly due to easing prices in May prompting major importers to restock after two previous months of a slowdown in buying,” said Sathia Varqa, a senior analyst with Fastmarkets Palm Oil Analytics in Singapore. “Uncertainty over the Indonesian export policy could also propel increased purchases from Malaysia.” Business Times
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US Slaps 10% Forced Labor Tariff on Indonesia
Jakarta. The US has slapped an additional 10% tariff on Indonesia for letting imported goods linked with forced labor enter the country.
In March, the Donald Trump 2.0 government launched a forced labor probe into Indonesia and dozens of other countries. On Tuesday Washington time, the US declared new tariffs of either 10% or 12.5%. The higher rate is for countries that have failed to not only impose, but also effectively enforce a prohibition on imported goods made with forced labor. Indonesia is subject to a lower rate for having bans in place, but lacks effective enforcement.
US Trade Representative Jamieson Greer slammed the failures as “unacceptable”.
“This creates a dynamic where American workers are forced to compete globally on an unlevel playing field,” Greer said.
Haryo Limanseto, the spokesperson at the Coordinating Ministry for Economic Affairs, told the Jakarta Globe that these were still interim investigations. Indonesia plans to submit written comments and join the upcoming public hearings.
“The Indonesian government remains committed to respecting human rights, labor protection, and implementing labor principles that are consistent with international standards,” Haryo said.
Jakarta also plans to engage in talks with the US side “in a constructive manner” while strengthening the implementation of import regulations.
Indonesia already has a tariff deal with the US government, although the pact remains subject to ratification. In its report, Washington wrote that Jakarta had “taken on commitments” on forced labor import prohibition under the pact. The latest tariff salvo is also just weeks ahead of the July 24 expiration of a 10% temporary tariff. Jakarta Globe
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Malaysia to retain palm oil market position despite EU–Indonesia trade agreement momentum
Malaysia is expected to maintain its competitive position in the global palm oil market despite accelerating progress in the Indonesia–EU trade agreement. While Indonesia, the world’s largest palm oil exporter, has concluded negotiations on a free trade agreement with the EU and is moving toward ratification, analysts say the competitive landscape remains more balanced than a simple first-mover advantage suggests.
Indonesia exported an estimated 23.6 mln tonnes of palm oil worth $24.4 bln in 2025, while Malaysia shipped 17.3 mln tonnes. However, Malaysia continues to hold a strong position in higher-value segments of the market, with total export earnings estimated at around $30 bln, reflecting its focus on refined and certified products.
A key factor shaping competition is compliance with the EU Deforestation Regulation (EUDR), where sustainability certification plays an increasingly important role alongside tariffs. Malaysia has already secured recognition of its Malaysian Sustainable Palm Oil (MSPO) certification in discussions with the EU, strengthening its regulatory standing regardless of the FTA timeline.
At the same time, Indonesia’s earlier progress in finalizing the trade agreement could improve its price competitiveness through potential tariff advantages. Currency dynamics may also play a role, with expectations of a stronger Malaysian ringgit and a relatively weaker Indonesian rupiah in 2026 influencing export pricing.
Despite these pressures, analysts believe Malaysia will retain a degree of competitive resilience, supported by its established sustainability framework and strong positioning in premium palm oil markets.
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FAO issues forest monitoring good practices for tree crop commodities and smallholders
ROME – The Food and Agriculture Organization of the United Nations (FAO) today published new guidance on forest monitoring, including on how to map and monitor tree-based agricultural commodities such as those produced in agroforestry systems. Launched today at the GeoField 2026 Convening, the Forest monitoring good practices: mapping tree crop commodities provides a comprehensive framework for using earth observation and geospatial data to identify the presence of crops like cocoa, coffee, rubber and palm oil.
From satellite images, a shaded cocoa plantation or a coffee agroforestry system can look nearly identical to a natural forest. The new guidance, intended for use by a broad range of actors, including national governments, private sector operators, civil society and researchers, sets out a methodology for gathering accurate data that reliably distinguishes between natural forests and farms cultivating tree crops.
“This technical publication comes at an important moment as international markets increasingly seek assurance that agricultural products are not linked to forest loss,” said Zhimin Wu, FAO Assistant Director-General and Director of the Forestry Division.
Why mapping tree crop commodities matters
While cereal crops such as wheat, maize and rice form the backbone of the global food trade, tree crops like cocoa, coffee and palm oil are among the highest value agricultural products traded globally.
Tree crop commodities are mostly grown in tropical countries and smallholder family farmers produce 80 per cent of the world’s coffee. In countries like Ghana and Côte d’Ivoire, cocoa is a primary source of income for most smallholder families.
Yet smallholders often manage small, irregularly shaped plots hidden under dense forest canopies, and without accurate mapping data, these producers are at risk of being excluded from global markets that are increasingly requesting transparent and responsible sourcing information.
Key recommendations
The good practices outline a sophisticated multi-step process for generating reliable commodity maps. Rather than relying on a single data source, the FAO recommends a "convergence of evidence" approach that integrates satellite imagery with ground-level intelligence.
Key recommendations include moving beyond traditional optical satellite images, which are often blocked by clouds in tropical regions and instead combining optical data with other sensors to "see through" weather patterns and measure the physical structure and height of vegetation.
The framework highlights the use of advanced algorithms and artificial intelligence to identify complex patterns in how crops are planted, helping to differentiate between the random growth of a forest and the managed rows or clusters of a farm.
It recommends verifying mapping produced with satellite imagery and radar by comparing it with reference data such as high-resolution drone imagery, field data and input from local experts.
It advocates for the use of standardised definitions for land cover, land use and forests so that all data is globally compatible and, for transparency, providing metadata with every map to explain how it was made, what the limitations may be and ensuring data sharing complies with privacy laws.
The publication, co-authored by a large span of actors from the public and private sector, makes the case for publicly available open data to support transparent and sustainable supply chains.
Good practices on forest monitoring: inclusive smallholder data governance
A second new FAO publication, Forest monitoring good practices: inclusive smallholder data governance, was also launched today at the GeoField 2026 Convening.
The publication provides an overview of the smallholder data landscape, including what, why and how data is collected, gathered and managed.
The publication explains the main risks and inequalities smallholder farmers face in how their data is collected and used, and recommends fairer data practices, shared standards, farmer-focused digital systems and better support to help farmers understand and manage their data. FAO
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June 03, 2026
Indonesia: State-led commodity reform a high-stakes shift for the rupiah
A structural regime shift is underway.
By Lloyd Chan/ MUFG Research
Key Points
Indonesia: State-led commodity reform a high-stakes shift for the rupiah
A structural regime shift is underway.
By Lloyd Chan/ MUFG Research
Key Points
- A structural regime shift is underway. Indonesia is transitioning toward a state-controlled commodity export system under Danantara Sumberdaya Indonesia (DSI), a new subsidiary of the Danantara sovereign wealth fund. Unlike global precedents typically focused on a single commodity resource, Indonesia is attempting to apply this model across multiple key commodities such as coal, palm oil, and ferroalloys, making the scope both unique and execution intensive.
- The commodity reform aims to strengthen fiscal position, FX reserves, and external stability, including ensuring full repatriation of commodity export proceeds. However, successful implementation hinges on the government’s ability to scale operational, trading, and pricing capabilities across several complex commodity value chains, alongside managing coordination across ministries and existing ecosystems.
- Implementation risks are high in the near term. Uncertainty during the rollout phase could disrupt trade flows, create pricing ambiguity, and weigh on investor sentiment. Markets appear to be pricing this risk, with the rupiah underperforming regional peers amid a softening macro backdrop - including a sharply narrowing trade surplus ($89mn in April vs. $3.3bn in March), declining FX reserves (down ~USD6.3bn YoY in April), and persistent capital outflows.
- Our base case: We expect the government to take direct control of several key commodity exports. Market mechanisms are not eliminated, but increasingly mediated by the state. Prices could still reference global benchmarks, even as state influence rises. Operational challenges are likely to persist across multiple commodity value chains, given the scale and complexity of coordination. At the same time, tail risks of policy overreach gradually fade, allowing market sentiment to stabilise. USDIDR could develop a mild downside bias on an unwinding of crowded long USDIDR positioning and cheap valuations. US–Iran de-escalation could be a key trigger for reversal.
- Policy outcomes are inherently binary over the medium term. Effective execution would strengthen Indonesia’s external position and underpin rupiah stability, while poor execution or policy overreach risks disrupting trade flows, eroding competitiveness, and driving prolonged currency weakness.
- BI’s policy support will help to partially offset rising country risk premia. The central bank has raised policy rate by 50bps in May and enhanced FX support measures via issuing more high-yielding SRBI, helping to improve the rupiah’s front-end carry appeal.
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Indonesian Palm Oil Association GAPKI Warns Against Disruptions From New Single-Gate Export Policy
Jakarta. Indonesia’s palm oil industry has urged the government to implement its new single-gate export system gradually, warning that abrupt changes could disrupt global trade networks and affect millions of farmers tied to the sector.
Eddy Martono, chairman of the Indonesian Palm Oil Association (Gapki), said on Tuesday that Indonesia’s palm oil industry currently exports to around 160 countries, making a careful transition essential to avoid trade disruptions under the new export management system operated by Danantara Sumberdaya Indonesia (DSI).
“We must avoid stagnation and losing our markets. If DSI is implemented while the institution is not yet fully ready, then the process should be gradual, not immediate. We will continue to provide input as the implementation progresses,” Eddy said after a meeting at the Coordinating Ministry for Economic Affairs in Jakarta.
According to Eddy, Gapki has submitted various recommendations to the government regarding the transition toward the centralized export mechanism.
One of the industry’s main concerns is preserving long-established business relationships between Indonesian exporters and overseas buyers.
“Building export markets is not easy. It does not happen within one or two months, but can take many years,” Eddy said.
He stressed that the palm oil industry plays a major role in Indonesia’s economy, particularly in employment creation and farmer welfare.
Around 41% of Indonesia’s oil palm plantations are owned by smallholder farmers, he said, making the sustainability of the sector a critical national issue.
“Smallholders own 41% of the plantations. This is not a trivial industry -- it is an extraordinary industry. It must be managed and protected properly,” Eddy said.
Earlier, Coordinating Minister for Economic Affairs Airlangga Hartarto said the government would gradually implement a centralized export management system for strategic natural resource commodities through DSI, a newly established state-owned export company. Jakarta Globe
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B15 biodiesel use boosts national diesel supply security for Malaysia during crises
PUTRAJAYA (June 3): The use of palm oil-based biodiesel not only supports the nation's sustainability agenda but also serves as an important alternative to strengthen diesel supply security during times of crisis, said Plantation and Commodities Minister Datuk Seri Dr Noraini Ahmad.
She said the primary consideration behind the proposal to expand biodiesel blending to B15 is to ensure the country has an alternative fuel source should disruptions occur in petroleum diesel supplies.
“The implementation of B15 biodiesel is a strategic government measure to strengthen national energy security, reduce dependence on fossil fuels and support the country's sustainability agenda through the use of more sustainable alternative energy sources,” she said.
She told reporters this after visiting the Klang Valley Distribution Terminal (KVDT) for the implementation of B15 biodiesel here on Wednesday.
Noraini said the implementation of B15, which began on June 1, was a government decision aimed at extending supply assurance during crises, and that Palm Methyl Ester (PME) is a viable alternative as it helps prolong the country's fuel reserves.
She said the government continues to encourage the use of biodiesel, in line with the country's commitment to environmental, social and governance (ESG) objectives and green development.
She said biodiesel implementation in Malaysia currently varies by location, with several areas having already achieved higher blending levels.
According to her, Sarawak, except Bintulu, as well as Labuan and Langkawi, have implemented B20 biodiesel, while other areas are using B10, B12 and B15 blends. The Edge
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Malaysian oil palm replanting slows due to rising fuel and fertiliser costs
Palm oil producers in Malaysia are scaling back replanting due to rising fertiliser and fuel costs amid elevated vegetable oil prices, The Edge Malaysia wrote.
Planters in the world’s second largest palm oil producer were facing fertiliser price increases of up to 60%, while diesel costs had more than doubled since the start of the US-Iraq Iran war, according to farmers, industry officials and analysts quoted in the 19 May report.
With the near-closure of the Strait of Hormuz holding back global energy supplies, benchmark prices of crude palm oil (CPO) had risen by about a tenth since late February, prompting farmers to produce rather than replant, The Edge Malaysia wrote.
Ageing oil palm plantations in Malaysia and top global producer Indonesia were a key concern for supply, with the industry only beginning to step up long-delayed replanting efforts in 2025, according to the report.
However, Indonesia – unlike Malaysia – had ample domestic supplies of fertiliser, the report said.
Replanting was critical to maintaining yields at a time when supplies were pressured by stagnating output and Indonesia diverted more of its production to biodiesel, The Edge Malaysia wrote.
Smallholder farmers, who comprise 40% of Malaysian output, were also scaling back replanting for lack of financial support, industry officials said.
In the Malaysian state of Sarawak on Borneo island, many smallholders cultivated land under Native Customary Rights, which did not confer formal ownership, said Napoleon Ningkos, president of the Sarawak Dayak Oil Palm Planters Association.
“If they don't replant, we will definitely see yields keep going down and this will affect volumes in coming years.”
Fertiliser comprised about half the costs of palm oil production costs, The Edge Malaysia wrote.
According to companies quoted in the report, the impact to date appears largely confined to smallholders, with major producers operating without significant disruption.
Despite this, maintaining a healthy replanting rate of 3%-4% in Malaysia this year could be challenging, due to current uncertainties, Roslin Azmy Hassan, chief executive of the Malaysian Palm Oil Association (MPOA) said.
Malaysia’s replanting rate rose to 3.4% in 2025, higher than the annual 2% rate over the previous five years, driven by accelerated replanting efforts by larger plantations and government support for smallholders, The Edge Malaysia wrote.
In addition to facing rising fertiliser and fuel costs, Malaysia’s agri-commodity sector was facing a severe cost squeeze on other fronts, with shipping costs to the Middle East surging between 50%-80% and war risk insurance premiums rising to as much as 3%, Economy Minister Akmal Nasrullah Mohd Nasir was quoted as saying in a 25 May New Straits Times (NST) report.
Upstream plantation and machinery costs had risen by 10%-30%, Nasir added.
Manufacturing costs were also under strain, with palm oleochemical production costs rising by up to 30%, NST wrote.
To protect smallholder incomes, Nasir said the government had implemented a series of mitigation measures through the Plantation and Commodities Ministry. Measures included monitoring plantation operating costs to optimise production expenses and channelling targeted cash assistance to smallholders through the Budi Agri-Komoditi scheme to ease the input cost burden. OFI Magazine
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Liberia's Exports to India Surge By 120% Driven By Palm Oil and Rubber
Liberia's exports to India more than doubled during the 2025-2026 financial year, propelled by surging shipments of crude palm kernel oil and natural rubber, according to official trade statistics from India's Ministry of Commerce and Industry.
The figures show Liberian exports to India rising from US$20.39 million in 2024-2025 to US$44.91 million in 2025-2026, representing growth of more than 120 percent and marking the strongest export performance recorded between the two countries in recent years. At the same time, India's exports to Liberia declined from US$376.33 million to US$345.15 million, narrowing Liberia's trade deficit and signaling a gradual strengthening of the country's export position in one of the world's fastest-growing major economies.
The development comes amid steadily deepening diplomatic and commercial relations between Monrovia and New Delhi, reinforcing India's status as one of Liberia's most significant trading partners.
While Liberia's public discourse often centers on mining, rail infrastructure and iron ore exports, the latest trade figures tell a different story. The country's export surge to India is being driven primarily by agriculture.
Official commodity-level data show that crude palm kernel oil emerged as Liberia's fastest-growing export to India, increasing from US$2.17 million to US$10.38 million within a single year--a remarkable 379 percent increase. Natural rubber exports also rose strongly, climbing from US$8.30 million to US$12.94 million.
Together, palm kernel oil and rubber generated more than US$23 million in export earnings, accounting for more than half of Liberia's total exports to India during the reporting period.
The figures suggest that agriculture, rather than extractive industries, is currently leading Liberia's export expansion into the Indian market.
The data also reveal an emerging recycling and industrial materials trade. Copper scrap exports surged from US$1.29 million to US$4.89 million, while aluminum scrap exports remained substantial at US$3.81 million. Exports of spent lead-acid batteries reached US$2.02 million, indicating growing demand for recyclable industrial materials.
Perhaps most strikingly, the statistics show no significant exports of iron ore concentrates from Liberia to India during the period under review, challenging assumptions that mining products are the primary drivers of bilateral trade growth.
The surge in Liberian exports is occurring within the framework of India's Duty-Free Tariff Preference (DFTP) Scheme, introduced in 2012, which grants Liberia zero-duty and preferential access to more than 98 percent of India's tariff lines.
The Indian government has described the DFTP scheme as a practical expression of South-South cooperation designed to improve market access for least-developed countries, including Liberia.
Trade figures released by India's Ministry of Commerce indicate that total bilateral trade between the two countries reached US$390.06 million during the 2025-2026 financial year, maintaining the strong momentum established over the past two years.
Observers note that the growing trade relationship is increasingly visible in everyday Liberian life. Indian-made Bajaj motorcycles and tricycles, TVS vehicles, Hero motorcycles and Sonalika agricultural machinery have become common across Liberia, reflecting the breadth of commercial engagement between the two countries.
Beyond trade in goods, the relationship has expanded significantly at the diplomatic level.
According to information provided by the Indian Embassy in Monrovia, a major turning point came in 2021 with the establishment of India's resident diplomatic mission in Liberia, enabling more frequent engagement between the two governments.
That engagement deepened further in December 2024 when Liberia and India held their first-ever Foreign Office Consultations in Monrovia. The consultations, co-chaired by India's Additional Secretary for the Ministry of External Affairs and Liberia's Foreign Affairs Minister Sara Beysolow Nyanti, covered cooperation in trade, investment, mining, agriculture, health, pharmaceuticals, education and people-to-people exchanges.
The growing partnership has also been reinforced through high-level visits and new areas of cooperation.
Liberia's Vice President Jeremiah Kpan Koung participated in the 19th Confederation of Indian Industry (CII) India-Africa Business Conclave in New Delhi, where discussions focused on investment opportunities and economic collaboration.
The two countries have also strengthened cooperation in public health and pharmaceutical regulation. Liberia recently signed a Memorandum of Understanding on cooperation in pharmacopoeia standards, enabling the country to recognize the Indian Pharmacopoeia as one of its approved standards for medicines. The agreement is expected to enhance pharmaceutical quality assurance and expand access to affordable medicines. All Africa
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June 02, 2026
Indonesia April trade surplus lowest since May 2020, currency weakness persists
SINGAPORE (ICIS)–Indonesia recorded its lowest trade surplus since May 2020 in April at $89.1 million, its narrowest margin since a consecutive 71-month surplus streak began in May 2020, while on Tuesday, the Indonesian rupiah (Rp) also plummeted to a fresh record low of Rp 17,892 against the US dollar.
Total exports surged 21.98% year on year in April to $25.30 billion, driven by elevated global commodity prices following the Middle East conflict’s outbreak, alongside strong performance in manufactured goods, palm oil derivatives and basic chemicals.
Total imports were up by 22.49% year on year to $25.21 billion. driven by an 82.52% explosion in oil and gas imports.
In January-April 2026, Indonesia’s trade balance recorded a surplus of US$5.64 billion, supported by a non-oil and gas surplus of $14.16 billion, while the oil and gas sector had a deficit of $8.52 billion.
Indonesia’s annualized consumer price index (CPI) also quickened to 3.08% in May from 2.42% in April, according to the BPS on 2 June.
A weakening currency and high global crude and oil product prices are driving up import costs, leading to rising inflation.
Caution over a breakdown in ceasefire talks between the US and Iran also contributed to the rupiah’s fall.
Indonesia’s central bank has a target inflation range of 1.5-3.5%, and surprised with a 50 basis-point hike in its recent May meeting.
However, Dutch-based financial services firm ING said on 20 May that Bank Indonesia (BI)’s decision was “unlikely to reverse the broader depreciation trend”, with an uncertain domestic policy weighing on sentiment.
Recent policy moves such as an export control policy for Indonesia’s natural resources, such as crude palm oil (CPO) and coal, have spooked foreign investors and increased uncertainty, market sources previously said.
The policy came into effect on 1 June, and new state-owned company Danantara Sumberdaya Indonesia (DSI), run by sovereign wealth fund Danantara, will take over specific export activities by January 2027, Coordinating Economic Minister Airlangga Hartarto said on 31 May.
An additional policy that came in effect on 1 June mandates that exporters of natural resources are to keep their proceeds within state banks, in a bid to strengthen the rupiah, President Prabowo Subianto said.
The government has set a mandatory repatriation of 100% of natural resource export proceeds into the Indonesian financial system, Hartato said.
In the oil and gas sector, exporters are required to place a minimum of 30% of foreign exchange proceeds from exports (DHE) for three months, while the non-oil and gas sector is required to place 100% of DHE for 12 months.
Focus article by Jonathan Yee
READ MORE
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Indonesia records 51 bln USD surplus in halal product trade in 2025
JAKARTA, June 1 (Xinhua) -- Indonesia recorded a halal product trade surplus of 51.17 billion U.S. dollars in 2025, supported by exports worth 63.42 billion dollars, Deputy Trade Minister Dyah Roro Esti Widya Putri said on Monday.
Palm oil and its derivatives remained the country's largest halal export category, valued at 34.16 billion dollars, followed by Muslim fashion products at 8.67 billion dollars and chemicals used in halal cosmetics worth 5.46 billion dollars.
During the first quarter of 2026, Indonesia's halal product exports reached 15.64 billion dollars, up 2.52 percent year on year, the official said.
The government plans to step up promotion, export facilitation and market expansion efforts, particularly in Latin America, Africa and North America, to increase the global market share of Indonesian halal products.
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Why Indonesia is Rebuilding Commodity Oversight
President Prabowo’s new initiative reflects a broader effort to address fragmented oversight, reduce commodity leakage, and strengthen his country’s role in global supply chains.
On May 20, Indonesian President Prabowo Subianto announced the establishment of PT Danantara Sumberdaya Indonesia (DSI), a new state entity under the Danantara sovereign wealth fund tasked with overseeing selected strategic commodity exports, initially focused on palm oil, coal, and ferro-alloys. The move reflects a broader government effort to strengthen oversight across Indonesia’s commodity sector and address practices estimated to contribute to billions of dollars in annual revenue leakage.
It has also prompted market concerns over potential regulatory bottlenecks, payment delays, and uncertainty surrounding how the new institution would function in practice. Because Indonesia increasingly sits at the center of global supply chains for energy, food, and critical minerals, the implications extend beyond domestic revenue collection to questions of trade reliability, industrial policy, and geopolitical influence.
The core mandate of DSI is to function primarily as a transparency, documentation, and monitoring platform rather than a profit-seeking intermediary, with officials emphasizing that the entity will not take margins or commissions from exporters. However, important uncertainties remain. Public communications surrounding the proposal have at times appeared internally inconsistent. Some elements of the proposed framework suggest a centralized monitoring and audit platform, while others imply a more interventionist role in export execution, a distinction with materially different implications for exporters and markets. A platform designed to improve visibility over contracts, pricing, and export proceeds carries very different implications from a centralized state trading intermediary. The Diplomat
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Ghana: We grow the tree but buy the oil: Fidelity Bank’s research shows why that has to change
Palm oil is in almost everything Ghanaians eat, yet the country imports more than it produces. A new report from Fidelity Bank’s Research and Market Insights Unit breaks down a structural problem that has been building for years.
The oil that runs everything
There is a product in your kitchen, your soap, your biscuits, your margarine, and quite possibly your fuel, that most people never think about. Palm oil is the most consumed vegetable oil in the world, producing 79.6 million metric tonnes annually, more than soybean, rapeseed, and sunflower oil combined. It overtook soybean oil as the global leader in 2006 and has not looked back since.
Ghana knows this crop well. The oil palm tree is native to West Africa. The country has the land, the climate, and the farming history to be a serious producer. Yet today, Ghana imports significantly more palm oil than it exports, spending GHS 1.06 billion more on imports than it earns from exports as of 2025.
That trade deficit has grown by 503percent compared to 2024 alone. This is the central finding of Fidelity Bank Ghana’s latest research report: Ghana’s Oil Palm Trade 2018 to 2025. And the numbers tell a story that goes far beyond trade statistics.
A continent that cannot feed its own demand
The problem is not unique to Ghana. Africa as a whole consumes 9.9 million metric tonnes of palm oil annually but produces only 3.5 million, leaving a production deficit of 6.4 million metric tonnes. That gap is being filled almost entirely by imports from Asia, primarily Malaysia and Indonesia, the two countries that now control roughly 86percent of global palm oil production.
For Ghana specifically, Malaysia supplies 59percent of all palm oil imports. Liberia accounts for 22percent, Indonesia another 7percent. The country’s exports, by contrast, flow mostly to Nigeria and Senegal, regional neighbours who are themselves trying to close their own supply gaps.
The picture that emerges is of a country positioned squarely in the middle of a continental food dependency, buying a product it has every natural condition to produce, from countries thousands of kilometres away.
The gap between potential and reality
What makes this particularly striking is the scale of what Ghana is not using. The country has 4.7 million hectares of arable land suitable for oil palm cultivation. Currently, only 0.4 million hectares are under harvest. That means roughly 91percent of Ghana’s potential oil palm land sits idle or underutilised.
Domestic production stands at around 300,000 metric tonnes annually. Domestic consumption is approximately 350,000 metric tonnes. Ghana is not even producing enough to feed its own market, let alone generate meaningful export volumes.
The report identifies the core bottleneck clearly: raw material scarcity driven by low yields, ageing trees, and a fragmented smallholder supply chain. Many of Ghana’s oil palm farms are run by smallholder farmers working with older tree stock, limited access to quality
seedlings and fertiliser, and roads that make it difficult to get fresh fruit to processing mills before quality degrades. The result is extraction rates that fall well below what the land and the crop are capable of delivering.
A market shaped by prices it cannot control
There is another layer to this problem that affects every Ghanaian who buys cooking oil. Because Ghana sources the majority of its palm oil from Asia, its cost structure is almost entirely determined by global commodity prices and international freight rates. When global palm oil prices surged in 2021, Ghana felt it immediately. Import values hit GHS 2,092 million that year, up sharply from GHS 888.9 million in 2018.
The country has limited ability to buffer itself against these swings because domestic supply cannot be scaled up quickly enough to respond. When external prices rise, Ghanaian consumers pay more. When freight costs increase, the gap widens further. The vulnerability is structural, not incidental.
Where the opportunity sits
The report is not pessimistic. It is honest about the problem, but it also maps the opportunity clearly. Ghana is not going to out-compete Malaysia or Indonesia on price. Those countries have decades of industrial infrastructure, government support, and economies of scale that are not easily replicated. That is not where Ghana’s advantage lies.
The real opportunity is in value addition and regional proximity. Africa’s demand for palm oil is growing. Countries across the continent are net importers. Under the African Continental Free Trade Area agreement, Ghana has a geographical and logistical advantage over Asian suppliers for those markets. The question is whether the country can build the processing and export infrastructure to take that position seriously.
Funding momentum is beginning to align. Development Bank Ghana has committed $500 million to support the agricultural sector, and development finance institutions are increasingly directing resources toward plantation expansion, outgrower schemes, and refinery upgrades. The BFT Online
Indonesia April trade surplus lowest since May 2020, currency weakness persists
SINGAPORE (ICIS)–Indonesia recorded its lowest trade surplus since May 2020 in April at $89.1 million, its narrowest margin since a consecutive 71-month surplus streak began in May 2020, while on Tuesday, the Indonesian rupiah (Rp) also plummeted to a fresh record low of Rp 17,892 against the US dollar.
- High oil prices erode trade surplus in April
- CPI up to 3.08% in May
- Export control policy uncertainty spooks investors, weakens rupiah
Total exports surged 21.98% year on year in April to $25.30 billion, driven by elevated global commodity prices following the Middle East conflict’s outbreak, alongside strong performance in manufactured goods, palm oil derivatives and basic chemicals.
Total imports were up by 22.49% year on year to $25.21 billion. driven by an 82.52% explosion in oil and gas imports.
In January-April 2026, Indonesia’s trade balance recorded a surplus of US$5.64 billion, supported by a non-oil and gas surplus of $14.16 billion, while the oil and gas sector had a deficit of $8.52 billion.
Indonesia’s annualized consumer price index (CPI) also quickened to 3.08% in May from 2.42% in April, according to the BPS on 2 June.
A weakening currency and high global crude and oil product prices are driving up import costs, leading to rising inflation.
Caution over a breakdown in ceasefire talks between the US and Iran also contributed to the rupiah’s fall.
Indonesia’s central bank has a target inflation range of 1.5-3.5%, and surprised with a 50 basis-point hike in its recent May meeting.
However, Dutch-based financial services firm ING said on 20 May that Bank Indonesia (BI)’s decision was “unlikely to reverse the broader depreciation trend”, with an uncertain domestic policy weighing on sentiment.
Recent policy moves such as an export control policy for Indonesia’s natural resources, such as crude palm oil (CPO) and coal, have spooked foreign investors and increased uncertainty, market sources previously said.
The policy came into effect on 1 June, and new state-owned company Danantara Sumberdaya Indonesia (DSI), run by sovereign wealth fund Danantara, will take over specific export activities by January 2027, Coordinating Economic Minister Airlangga Hartarto said on 31 May.
An additional policy that came in effect on 1 June mandates that exporters of natural resources are to keep their proceeds within state banks, in a bid to strengthen the rupiah, President Prabowo Subianto said.
The government has set a mandatory repatriation of 100% of natural resource export proceeds into the Indonesian financial system, Hartato said.
In the oil and gas sector, exporters are required to place a minimum of 30% of foreign exchange proceeds from exports (DHE) for three months, while the non-oil and gas sector is required to place 100% of DHE for 12 months.
Focus article by Jonathan Yee
READ MORE
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Indonesia records 51 bln USD surplus in halal product trade in 2025
JAKARTA, June 1 (Xinhua) -- Indonesia recorded a halal product trade surplus of 51.17 billion U.S. dollars in 2025, supported by exports worth 63.42 billion dollars, Deputy Trade Minister Dyah Roro Esti Widya Putri said on Monday.
Palm oil and its derivatives remained the country's largest halal export category, valued at 34.16 billion dollars, followed by Muslim fashion products at 8.67 billion dollars and chemicals used in halal cosmetics worth 5.46 billion dollars.
During the first quarter of 2026, Indonesia's halal product exports reached 15.64 billion dollars, up 2.52 percent year on year, the official said.
The government plans to step up promotion, export facilitation and market expansion efforts, particularly in Latin America, Africa and North America, to increase the global market share of Indonesian halal products.
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Why Indonesia is Rebuilding Commodity Oversight
President Prabowo’s new initiative reflects a broader effort to address fragmented oversight, reduce commodity leakage, and strengthen his country’s role in global supply chains.
On May 20, Indonesian President Prabowo Subianto announced the establishment of PT Danantara Sumberdaya Indonesia (DSI), a new state entity under the Danantara sovereign wealth fund tasked with overseeing selected strategic commodity exports, initially focused on palm oil, coal, and ferro-alloys. The move reflects a broader government effort to strengthen oversight across Indonesia’s commodity sector and address practices estimated to contribute to billions of dollars in annual revenue leakage.
It has also prompted market concerns over potential regulatory bottlenecks, payment delays, and uncertainty surrounding how the new institution would function in practice. Because Indonesia increasingly sits at the center of global supply chains for energy, food, and critical minerals, the implications extend beyond domestic revenue collection to questions of trade reliability, industrial policy, and geopolitical influence.
The core mandate of DSI is to function primarily as a transparency, documentation, and monitoring platform rather than a profit-seeking intermediary, with officials emphasizing that the entity will not take margins or commissions from exporters. However, important uncertainties remain. Public communications surrounding the proposal have at times appeared internally inconsistent. Some elements of the proposed framework suggest a centralized monitoring and audit platform, while others imply a more interventionist role in export execution, a distinction with materially different implications for exporters and markets. A platform designed to improve visibility over contracts, pricing, and export proceeds carries very different implications from a centralized state trading intermediary. The Diplomat
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Ghana: We grow the tree but buy the oil: Fidelity Bank’s research shows why that has to change
Palm oil is in almost everything Ghanaians eat, yet the country imports more than it produces. A new report from Fidelity Bank’s Research and Market Insights Unit breaks down a structural problem that has been building for years.
The oil that runs everything
There is a product in your kitchen, your soap, your biscuits, your margarine, and quite possibly your fuel, that most people never think about. Palm oil is the most consumed vegetable oil in the world, producing 79.6 million metric tonnes annually, more than soybean, rapeseed, and sunflower oil combined. It overtook soybean oil as the global leader in 2006 and has not looked back since.
Ghana knows this crop well. The oil palm tree is native to West Africa. The country has the land, the climate, and the farming history to be a serious producer. Yet today, Ghana imports significantly more palm oil than it exports, spending GHS 1.06 billion more on imports than it earns from exports as of 2025.
That trade deficit has grown by 503percent compared to 2024 alone. This is the central finding of Fidelity Bank Ghana’s latest research report: Ghana’s Oil Palm Trade 2018 to 2025. And the numbers tell a story that goes far beyond trade statistics.
A continent that cannot feed its own demand
The problem is not unique to Ghana. Africa as a whole consumes 9.9 million metric tonnes of palm oil annually but produces only 3.5 million, leaving a production deficit of 6.4 million metric tonnes. That gap is being filled almost entirely by imports from Asia, primarily Malaysia and Indonesia, the two countries that now control roughly 86percent of global palm oil production.
For Ghana specifically, Malaysia supplies 59percent of all palm oil imports. Liberia accounts for 22percent, Indonesia another 7percent. The country’s exports, by contrast, flow mostly to Nigeria and Senegal, regional neighbours who are themselves trying to close their own supply gaps.
The picture that emerges is of a country positioned squarely in the middle of a continental food dependency, buying a product it has every natural condition to produce, from countries thousands of kilometres away.
The gap between potential and reality
What makes this particularly striking is the scale of what Ghana is not using. The country has 4.7 million hectares of arable land suitable for oil palm cultivation. Currently, only 0.4 million hectares are under harvest. That means roughly 91percent of Ghana’s potential oil palm land sits idle or underutilised.
Domestic production stands at around 300,000 metric tonnes annually. Domestic consumption is approximately 350,000 metric tonnes. Ghana is not even producing enough to feed its own market, let alone generate meaningful export volumes.
The report identifies the core bottleneck clearly: raw material scarcity driven by low yields, ageing trees, and a fragmented smallholder supply chain. Many of Ghana’s oil palm farms are run by smallholder farmers working with older tree stock, limited access to quality
seedlings and fertiliser, and roads that make it difficult to get fresh fruit to processing mills before quality degrades. The result is extraction rates that fall well below what the land and the crop are capable of delivering.
A market shaped by prices it cannot control
There is another layer to this problem that affects every Ghanaian who buys cooking oil. Because Ghana sources the majority of its palm oil from Asia, its cost structure is almost entirely determined by global commodity prices and international freight rates. When global palm oil prices surged in 2021, Ghana felt it immediately. Import values hit GHS 2,092 million that year, up sharply from GHS 888.9 million in 2018.
The country has limited ability to buffer itself against these swings because domestic supply cannot be scaled up quickly enough to respond. When external prices rise, Ghanaian consumers pay more. When freight costs increase, the gap widens further. The vulnerability is structural, not incidental.
Where the opportunity sits
The report is not pessimistic. It is honest about the problem, but it also maps the opportunity clearly. Ghana is not going to out-compete Malaysia or Indonesia on price. Those countries have decades of industrial infrastructure, government support, and economies of scale that are not easily replicated. That is not where Ghana’s advantage lies.
The real opportunity is in value addition and regional proximity. Africa’s demand for palm oil is growing. Countries across the continent are net importers. Under the African Continental Free Trade Area agreement, Ghana has a geographical and logistical advantage over Asian suppliers for those markets. The question is whether the country can build the processing and export infrastructure to take that position seriously.
Funding momentum is beginning to align. Development Bank Ghana has committed $500 million to support the agricultural sector, and development finance institutions are increasingly directing resources toward plantation expansion, outgrower schemes, and refinery upgrades. The BFT Online
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June 01, 2026
Indonesia vows transparency as it starts transition to centralised commodity exports
By Reuters
Summary
JAKARTA, June 1 (Reuters) - Indonesia pledged transparency in the state company that will become its sole exporter of important commodities, as a transition period to a centralised export system started on Monday with coal, palm oil and ferroalloys.
President Prabowo Subianto on May 20 announced resource-rich Indonesia would centralise control of exports of all of its strategic commodities through a new state company, Danantara Sumberdaya Indonesia (DSI) , that will be overseen by sovereign wealth fund Danantara.
The policy is aimed at improving tax revenues by tackling under-invoicing and transfer pricing, while also making sure proceeds are kept onshore to bolster U.S. dollar supplies, particularly after the rupiah hit its historic lows multiple times this year.
Danantara's chief operating officer Dony Oskaria told a press conference on Sunday that DSI would operate transparently and accountably, including on the benchmarking of commodity prices during the transition.
"We will ensure that this company will be run transparently and can be monitored by everyone in Indonesia," Oskaria said.
Indonesia is the world's largest exporter of thermal coal, palm oil and nickel, and its exports of these commodities topped $65 billion last year.
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Indonesia Launches Single-Gate Export System for Palm Oil, Coal, and Ferroalloys
Jakarta. Indonesia will officially begin implementing a centralized export system for selected natural resource commodities on June 1 through Danantara Sumberdaya Indonesia (DSI), a newly established state-owned entity designed to improve trade transparency and prevent revenue leakage from exports.
The policy will initially cover three strategic commodities: palm oil, coal, and ferroalloys.
Coordinating Minister for Economic Affairs Airlangga Hartarto said on Sunday that implementation would be carried out in phases, beginning Monday, with full operation targeted by Jan. 1, 2027.
During the transition period, exporters will continue conducting overseas sales independently. However, companies will be required to report all export activities to DSI. Jakarta Globe
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Indonesia Launches June 1 State-Controlled Export Transition as Jakarta Vows No Disruptions to Global Commodity Chains
Key Takeaways
● Indonesia begins its mandatory single-window export transition on June 1, forcing crude palm oil, coal, and ferroalloy producers to route compliance reporting through a new state vehicle.
● The state-owned enterprise PT Danantara Sumberdaya Indonesia will assume total control of all commercial contracts, transaction invoicing, and trade settlements on January 1, 2027.
● The Ministry of Finance is putting the state entity on notice, initiating mandatory three-month performance audits to ensure the centralization immediately drives up corporate tax receipts.
● The parent state fund is aggressively vetting international professionals and building customized digital infrastructure to guard the new system against corruption.
JAKARTA, Investortrust.id — The Indonesian government has locked in Monday, June 1, 2026, as the official start date for its high-stakes single-window resource export policy, kicking off a seven-month transitional runway designed to secure total state control over strategic global commodities without disrupting near-term trade.
Under the rollout plan, multinational exporters of crude palm oil, coal, and ferroalloys can maintain normal day-to-day trade logistics but face an immediate mandate to log all transactions with PT Danantara Sumberdaya Indonesia (DSI), the newly formed operational export arm of the state. This data-gathering phase will run through December 31, 2026, giving global supply chains a brief window to adapt before Jakarta permanently seizes the reins. On January 1, 2027, the transition ends, and DSI will assume absolute control over the entirety of Indonesia's resource trade, executing every stage of commercial activity from initial contract signatures to final multi-billion-dollar trade settlements.
For global commodity traders, industrial buyers, and international funds, this operational transition marks the critical countdown to a state-monopolized resource architecture in Southeast Asia’s largest economy. By allowing a seven-month buffer, Jakarta is consciously trying to avert standard emerging-market execution bottlenecks and keep international capital from panicking. However, once full centralization takes over in 2027, the private sector's direct commercial autonomy will vanish, effectively turning DSI into the ultimate gatekeeper of global palm oil, coal, and metallurgical supplies. Investor Trust
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Government finds 139 CPO mills cutting FFB prices
JAKARTA – The government has identified 139 palm oil mills (PKS) that unilaterally lowered their purchase prices for farmers' fresh fruit bunches (FFB).
The finding has drawn serious attention as it comes at a time when global palm oil prices and demand remain relatively stable.
Deputy Minister of Agriculture Sudaryono stressed that there is no justification for palm oil mills to suppress FFB prices paid to farmers.
The government has called on refineries and exporters to continue conducting trade transactions in accordance with market mechanisms, using reasonable volumes and prices that reflect international market conditions.
"We urge refineries and exporters to continue carrying out trade transactions as they should, with reasonable volumes and prices based on market benchmarks. Since global prices have not fallen and demand has not weakened, there is no reason for farmers' FFB prices to decline," Sudaryono said during a coordination meeting at the Ministry of Agriculture headquarters in Jakarta on Friday (29 May).
Following a meeting with palm oil industry associations on 26 May 2026, 16 palm oil mills have begun readjusting their FFB purchase prices. However, the government believes the improvement must be expanded to ensure farmers once again receive normal market prices.
Sudaryono also dismissed concerns among industry players regarding the planned implementation of a single-gateway export policy through PT Danantara Sumberdaya Indonesia (DSI).
According to him, PT DSI will not generate profits from export activities but will instead act as a manager and supervisor of trade governance to improve transparency and accountability.
The government emphasised that the national palm oil industry will continue to operate normally during the policy transition period. The transition will run from 1 June to 31 August 2026, ahead of the full implementation of the single-gateway export policy on 1 January 2027.
Under the agreement reached with stakeholders, refineries and exporters will remain the primary participants in Indonesia's palm oil trade. IDN Financials
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GAPKI Reveals Palm Big Challenges That Need Urgent Solutions
JAKARTA – The Indonesian Palm Oil Association (GAPKI) Chairman Eddy Martono revealed a number of critical challenges, which are currently haunting the national palm oil industries.
“Those challenges include surging domestic consumption, the threat of declining CPO exports, and the urgency of legal certainty for the sustainability of palm oil investment in Indonesia,” Eddy Martono said during an exclusive interview with CNBC Indonesia, recently.
Importers growingly worried, Pakistan affected the most
The implementation of the mandatory program of biodiesel 50 percent (B50) has now begun to raise serious concerns among the major importers of palm oil from Indonesia. It has increased domestic palm oil consumption, while threatening to cause a decline of palm exports.
Among the importers, Pakistan is one of the most concerned countries. Their dependence on Indonesian CPO supply is so significant that two Pakistani ministers planned to make a visit to Indonesia to meet with GAPKI and discuss future supply guarantees.
Eddy Martono warned that Indonesia must not ignore the loyalty of these loyal purchasing countries.
“Once they have switched to other vegetable oils, it won’t be easy for Indonesia to recapture that market,” Eddy Martono emphasized.
RI’s palm exports threatened to be replaced by other vegetable oils
One of the biggest threats to the Indonesian palm oil industry is intense competition with other vegetable oils in the global market. When CPO prices become too high or Indonesian supplies decrease, purchasing countries could potentially turn to soybean, sunflower, or rapeseed oil as substitutes.
Although Indonesia remains the world’s largest producer and exporter of palm oil, Eddy emphasized that this dominant position cannot be considered permanent without a solid production strategy and price stability.
The risks of high CPO prices
The increase in domestic biodiesel demand has the potential to push CPO prices above US$ 1,300 per ton. While this may seem advantageous for palm oil farmers in the short term, Eddy Martono warned of negative long-term impacts.
If CPO prices are too high, importing countries could cut imports and switch to alternative vegetable oils. Conversely, if production continues to increase while exports decline, domestic stocks will swell and depress domestic palm oil prices.
“Not only farmers, but companies could also be affected if domestic prices are ultimately depressed,” he said.
GAPKI proposes flexible implementation of Biodiesel
To maintain a balance between national energy need and export interests, GAPKI proposes that the biodiesel mandatory program be made more adaptable to global market dynamics.
When exports increase, the biodiesel blend can be lowered to B40 or B35. Conversely, when domestic energy demand increases, the mandatory blend can be raised back to B50.
Eddy cited the example of Brazil, which successfully implemented a flexible scheme for sugar and ethanol production based on market conditions—a model deemed relevant for Indonesia to adapt.
Replanting Program hindered by forest issues
The replanting program for oil palm smallholders’ plantations (PSR) is touted as a key solution to boosting national palm oil productivity. However, this strategic program still faces a major obstacle: much of the smallholders’ oil palm land remains administratively within forest areas.
As a result, millions of smallholders have not been able to access the replanting assistance fund of Rp 60 million per hectare from the plantation fund management board (BPDP). Eddy Martono urged the government to immediately resolve the issue of overlapping forest areas so that the implementation of PSR program can be optimized and national palm oil production continues to increase.
RI’s palm down-streaming reaches positive results
Amidst various challenges facing the palm oil industries, Eddy Martono expressed positive news: Indonesia’s palm oil down-streaming is showing encouraging progress.
Of Indonesia’s total palm oil exports, which were expected to reach approximately 32 million tons by 2025, the export of crude palm oil (CPO) was only less than 3.0 million tons. The rest are in the forms of downstream products and other palm oil derivatives with higher added values.
The success is inextricably linked to the role of the mandatory biodiesel policy and the implementation of export levies, which have encouraged massive investment in the downstream palm oil sector.
Legal certainty: Key to future of RI’s palm oil industries
Despite the bright prospects for the palm oil industry, Eddy Martono emphasized that the biggest challenges that must be addressed immediately are legal certainty and a conducive business climate.
Issues of overlapping forest areas, unclear extensions of Land Use Rights (HGU), and frequently changing regulations are considered to hinder long-term investment in the palm oil plantation sector.
Without adequate regulatory certainty, companies will be hesitant to invest in oil palm plantation expansion or rejuvenation.
Therefore, GAPKI continues to coordinate intensively with the government—including the Indonesian Ministry of Agriculture—to ensure that various issues in the palm oil industry are quickly resolved. The ultimate goal is to ensure that Indonesia remains a strong leader in the global palm oil industry.
https://gapki.id/en/news/2026/05/17/gapki-reveals-palm-big-challenges-that-need-urgent-solutions/
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Malaysia begins rollout of B15 biodiesel blend to boost energy security and palm oil demand
Kuala Lumpur: Malaysia has begun the gradual implementation of its B15 biodiesel programme across Peninsular Malaysia, marking a new step in the country’s energy transition strategy while creating additional demand for domestically produced palm oil.
Under the new programme, biodiesel will consist of 15 per cent palm oil-based biodiesel, known as Palm Methyl Ester (PME), blended with 85 per cent petroleum diesel. The move replaces the existing B10 blend, which contains 10 per cent PME, The Star reported.
The government views the initiative as part of a broader effort to strengthen energy security, reduce dependence on imported diesel and provide greater support to the palm oil industry amid uncertainty in global energy markets.
The transition to B15 is expected to take place in stages, with authorities emphasising that the higher biodiesel blend can be used in most diesel vehicles without requiring engine modifications.
Deputy Prime Minister Ahmad Zahid Hamidi previously said the government intends to increase biodiesel production gradually before considering further increases in blend rates based on market conditions and industry readiness.
He also highlighted the potential of palm oil industry by-products, including sludge generated during crude palm oil processing, for use in biodiesel and aviation fuel production. According to him, this could help create new value-added opportunities within Malaysia’s commodity sector.
The government has assured industry stakeholders that the rollout will be carefully managed, taking into account palm oil availability, industrial preparedness and supporting infrastructure.
Plantation and Commodities Minister Noraini Ahmad said the B15 programme is expected to consume around 0.8 million tonnes of palm oil annually. She noted that this remains well below Malaysia’s estimated annual domestic palm oil surplus of approximately four million tonnes. Bioenergy Times
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Explainer: Inside Malaysia's B15 move
KUALA LUMPUR: Effective June 1, Malaysia will advance its energy transition by raising the Peninsular biodiesel blend from B10 to B15, a move aimed at easing dependence on imported diesel while giving a bigger role to palm oil in the country's fuel mix.
At its core, the policy means every litre of diesel will now contain 15 per cent palm-based biodiesel (palm methyl ester), up from 10 per cent previously. The rest remains conventional petroleum diesel. The change may appear technical but the impact is felt more in the backdrop of the economy, especially in plantations, refineries and fuel supply chains.
The B15 biodiesel will be produced by 19 licensed plants in an effort to lower diesel prices nationwide.
For Malaysia's palm oil industry, the shift translates into a meaningful lift in domestic demand. Annual usage for biodiesel is expected to rise to about 801,000 tonnes, compared with 534,000 tonnes under the B10 programme.
That basicially means that the additional uptake will provide a steady local market for crude palm oil (CPO) and support smallholders, even as overall supply remains comfortable at a surplus estimated at around four million tonnes.
Officials say the rollout will be phased to avoid price distortions in crude palm oil and to ensure producers can adjust smoothly. Importantly, the higher domestic usage is not expected to affect Malaysia's export flows, which stand at roughly 16 million tonnes a year. NST
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Malaysia unlikely to lose edge despite Indonesia FTA head start
KUALA LUMPUR: Indonesia's move to finalise a free trade agreement (FTA) with the European Union (EU) could sharpen price competition for Malaysian palm oil exports, but analysts say Malaysia is unlikely to lose its competitive edge in the global market.
Indonesia, the world's largest palm oil exporter, concluded negotiations with the EU on Sept 23 last year. The deal is undergoing legal review and ratification, with entry into force targeted for Jan 1 next year.
In contrast, Malaysia has made slower progress in its FTA talks with the EU, completing only the third round of negotiations in February this year.
The fourth round resumes this month.
Indonesia's palm oil exports were estimated at 23.6 million tonnes in 2025, generating US$24.4 billion.
Malaysia, the second-largest exporter, shipped 17.3 million tonnes of palm oil last year.
While smaller in volume compared with Indonesia, Malaysia maintains a strong position in higher-value segments, particularly certified and refined palm oil products.
Export earnings were estimated at about RM120 billion.
STRATEGIC MEASURES
Consulting firm ESG in Malaysia executive director Dr Harald Sippel told Business Times: "While there is a first-mover advantage, the situation is more nuanced than it appears at first glance."
Malaysia still has room to respond with its own strategic countermeasures, he added.
He said Indonesia's concluded Comprehensive Economic Partnership Agreement gives it an early platform in working with the EU on sustainability and compliance requirements under the EU Deforestation Regulation (EUDR), which now plays a bigger role than tariffs in determining palm oil market access.
"That said, Malaysia has been pursuing what I would describe as a parallel regulatory diplomacy track that the FTA timeline debate almost entirely misses.
"In September 2025, ahead of its own FTA conclusion, Malaysia secured recognition of its Malaysian Sustainable Palm Oil (MSPO) certification in a joint statement with the EU.
"This is significant because EUDR compliance hinges not just on tariffs but on whether a country's domestic certification scheme is recognised as credible.
"Malaysia moved on that front independently of its FTA timeline."
Sippel said Malaysia also concluded an economic partnership agreement with the European Free Trade Association (EFTA) states in June 2025, which includes a joint statement on palm oil.
He added that while the EFTA deal is not equivalent to an EU FTA, it helps establish frameworks and precedents that could support future FTA negotiations with the union. NST
Indonesia vows transparency as it starts transition to centralised commodity exports
By Reuters
Summary
- DSI pledges transparent operations, communications with private sector, Danantara says
- Transition period to centralised exports will last at least three months, full rollout by 2027
- Policy aims to curb tax avoidance and boost onshore U.S. dollar supply after rupiah weakness
JAKARTA, June 1 (Reuters) - Indonesia pledged transparency in the state company that will become its sole exporter of important commodities, as a transition period to a centralised export system started on Monday with coal, palm oil and ferroalloys.
President Prabowo Subianto on May 20 announced resource-rich Indonesia would centralise control of exports of all of its strategic commodities through a new state company, Danantara Sumberdaya Indonesia (DSI) , that will be overseen by sovereign wealth fund Danantara.
The policy is aimed at improving tax revenues by tackling under-invoicing and transfer pricing, while also making sure proceeds are kept onshore to bolster U.S. dollar supplies, particularly after the rupiah hit its historic lows multiple times this year.
Danantara's chief operating officer Dony Oskaria told a press conference on Sunday that DSI would operate transparently and accountably, including on the benchmarking of commodity prices during the transition.
"We will ensure that this company will be run transparently and can be monitored by everyone in Indonesia," Oskaria said.
Indonesia is the world's largest exporter of thermal coal, palm oil and nickel, and its exports of these commodities topped $65 billion last year.
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Indonesia Launches Single-Gate Export System for Palm Oil, Coal, and Ferroalloys
Jakarta. Indonesia will officially begin implementing a centralized export system for selected natural resource commodities on June 1 through Danantara Sumberdaya Indonesia (DSI), a newly established state-owned entity designed to improve trade transparency and prevent revenue leakage from exports.
The policy will initially cover three strategic commodities: palm oil, coal, and ferroalloys.
Coordinating Minister for Economic Affairs Airlangga Hartarto said on Sunday that implementation would be carried out in phases, beginning Monday, with full operation targeted by Jan. 1, 2027.
During the transition period, exporters will continue conducting overseas sales independently. However, companies will be required to report all export activities to DSI. Jakarta Globe
--------
Indonesia Launches June 1 State-Controlled Export Transition as Jakarta Vows No Disruptions to Global Commodity Chains
Key Takeaways
● Indonesia begins its mandatory single-window export transition on June 1, forcing crude palm oil, coal, and ferroalloy producers to route compliance reporting through a new state vehicle.
● The state-owned enterprise PT Danantara Sumberdaya Indonesia will assume total control of all commercial contracts, transaction invoicing, and trade settlements on January 1, 2027.
● The Ministry of Finance is putting the state entity on notice, initiating mandatory three-month performance audits to ensure the centralization immediately drives up corporate tax receipts.
● The parent state fund is aggressively vetting international professionals and building customized digital infrastructure to guard the new system against corruption.
JAKARTA, Investortrust.id — The Indonesian government has locked in Monday, June 1, 2026, as the official start date for its high-stakes single-window resource export policy, kicking off a seven-month transitional runway designed to secure total state control over strategic global commodities without disrupting near-term trade.
Under the rollout plan, multinational exporters of crude palm oil, coal, and ferroalloys can maintain normal day-to-day trade logistics but face an immediate mandate to log all transactions with PT Danantara Sumberdaya Indonesia (DSI), the newly formed operational export arm of the state. This data-gathering phase will run through December 31, 2026, giving global supply chains a brief window to adapt before Jakarta permanently seizes the reins. On January 1, 2027, the transition ends, and DSI will assume absolute control over the entirety of Indonesia's resource trade, executing every stage of commercial activity from initial contract signatures to final multi-billion-dollar trade settlements.
For global commodity traders, industrial buyers, and international funds, this operational transition marks the critical countdown to a state-monopolized resource architecture in Southeast Asia’s largest economy. By allowing a seven-month buffer, Jakarta is consciously trying to avert standard emerging-market execution bottlenecks and keep international capital from panicking. However, once full centralization takes over in 2027, the private sector's direct commercial autonomy will vanish, effectively turning DSI into the ultimate gatekeeper of global palm oil, coal, and metallurgical supplies. Investor Trust
--------
Government finds 139 CPO mills cutting FFB prices
JAKARTA – The government has identified 139 palm oil mills (PKS) that unilaterally lowered their purchase prices for farmers' fresh fruit bunches (FFB).
The finding has drawn serious attention as it comes at a time when global palm oil prices and demand remain relatively stable.
Deputy Minister of Agriculture Sudaryono stressed that there is no justification for palm oil mills to suppress FFB prices paid to farmers.
The government has called on refineries and exporters to continue conducting trade transactions in accordance with market mechanisms, using reasonable volumes and prices that reflect international market conditions.
"We urge refineries and exporters to continue carrying out trade transactions as they should, with reasonable volumes and prices based on market benchmarks. Since global prices have not fallen and demand has not weakened, there is no reason for farmers' FFB prices to decline," Sudaryono said during a coordination meeting at the Ministry of Agriculture headquarters in Jakarta on Friday (29 May).
Following a meeting with palm oil industry associations on 26 May 2026, 16 palm oil mills have begun readjusting their FFB purchase prices. However, the government believes the improvement must be expanded to ensure farmers once again receive normal market prices.
Sudaryono also dismissed concerns among industry players regarding the planned implementation of a single-gateway export policy through PT Danantara Sumberdaya Indonesia (DSI).
According to him, PT DSI will not generate profits from export activities but will instead act as a manager and supervisor of trade governance to improve transparency and accountability.
The government emphasised that the national palm oil industry will continue to operate normally during the policy transition period. The transition will run from 1 June to 31 August 2026, ahead of the full implementation of the single-gateway export policy on 1 January 2027.
Under the agreement reached with stakeholders, refineries and exporters will remain the primary participants in Indonesia's palm oil trade. IDN Financials
--------
GAPKI Reveals Palm Big Challenges That Need Urgent Solutions
JAKARTA – The Indonesian Palm Oil Association (GAPKI) Chairman Eddy Martono revealed a number of critical challenges, which are currently haunting the national palm oil industries.
“Those challenges include surging domestic consumption, the threat of declining CPO exports, and the urgency of legal certainty for the sustainability of palm oil investment in Indonesia,” Eddy Martono said during an exclusive interview with CNBC Indonesia, recently.
Importers growingly worried, Pakistan affected the most
The implementation of the mandatory program of biodiesel 50 percent (B50) has now begun to raise serious concerns among the major importers of palm oil from Indonesia. It has increased domestic palm oil consumption, while threatening to cause a decline of palm exports.
Among the importers, Pakistan is one of the most concerned countries. Their dependence on Indonesian CPO supply is so significant that two Pakistani ministers planned to make a visit to Indonesia to meet with GAPKI and discuss future supply guarantees.
Eddy Martono warned that Indonesia must not ignore the loyalty of these loyal purchasing countries.
“Once they have switched to other vegetable oils, it won’t be easy for Indonesia to recapture that market,” Eddy Martono emphasized.
RI’s palm exports threatened to be replaced by other vegetable oils
One of the biggest threats to the Indonesian palm oil industry is intense competition with other vegetable oils in the global market. When CPO prices become too high or Indonesian supplies decrease, purchasing countries could potentially turn to soybean, sunflower, or rapeseed oil as substitutes.
Although Indonesia remains the world’s largest producer and exporter of palm oil, Eddy emphasized that this dominant position cannot be considered permanent without a solid production strategy and price stability.
The risks of high CPO prices
The increase in domestic biodiesel demand has the potential to push CPO prices above US$ 1,300 per ton. While this may seem advantageous for palm oil farmers in the short term, Eddy Martono warned of negative long-term impacts.
If CPO prices are too high, importing countries could cut imports and switch to alternative vegetable oils. Conversely, if production continues to increase while exports decline, domestic stocks will swell and depress domestic palm oil prices.
“Not only farmers, but companies could also be affected if domestic prices are ultimately depressed,” he said.
GAPKI proposes flexible implementation of Biodiesel
To maintain a balance between national energy need and export interests, GAPKI proposes that the biodiesel mandatory program be made more adaptable to global market dynamics.
When exports increase, the biodiesel blend can be lowered to B40 or B35. Conversely, when domestic energy demand increases, the mandatory blend can be raised back to B50.
Eddy cited the example of Brazil, which successfully implemented a flexible scheme for sugar and ethanol production based on market conditions—a model deemed relevant for Indonesia to adapt.
Replanting Program hindered by forest issues
The replanting program for oil palm smallholders’ plantations (PSR) is touted as a key solution to boosting national palm oil productivity. However, this strategic program still faces a major obstacle: much of the smallholders’ oil palm land remains administratively within forest areas.
As a result, millions of smallholders have not been able to access the replanting assistance fund of Rp 60 million per hectare from the plantation fund management board (BPDP). Eddy Martono urged the government to immediately resolve the issue of overlapping forest areas so that the implementation of PSR program can be optimized and national palm oil production continues to increase.
RI’s palm down-streaming reaches positive results
Amidst various challenges facing the palm oil industries, Eddy Martono expressed positive news: Indonesia’s palm oil down-streaming is showing encouraging progress.
Of Indonesia’s total palm oil exports, which were expected to reach approximately 32 million tons by 2025, the export of crude palm oil (CPO) was only less than 3.0 million tons. The rest are in the forms of downstream products and other palm oil derivatives with higher added values.
The success is inextricably linked to the role of the mandatory biodiesel policy and the implementation of export levies, which have encouraged massive investment in the downstream palm oil sector.
Legal certainty: Key to future of RI’s palm oil industries
Despite the bright prospects for the palm oil industry, Eddy Martono emphasized that the biggest challenges that must be addressed immediately are legal certainty and a conducive business climate.
Issues of overlapping forest areas, unclear extensions of Land Use Rights (HGU), and frequently changing regulations are considered to hinder long-term investment in the palm oil plantation sector.
Without adequate regulatory certainty, companies will be hesitant to invest in oil palm plantation expansion or rejuvenation.
Therefore, GAPKI continues to coordinate intensively with the government—including the Indonesian Ministry of Agriculture—to ensure that various issues in the palm oil industry are quickly resolved. The ultimate goal is to ensure that Indonesia remains a strong leader in the global palm oil industry.
https://gapki.id/en/news/2026/05/17/gapki-reveals-palm-big-challenges-that-need-urgent-solutions/
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Malaysia begins rollout of B15 biodiesel blend to boost energy security and palm oil demand
Kuala Lumpur: Malaysia has begun the gradual implementation of its B15 biodiesel programme across Peninsular Malaysia, marking a new step in the country’s energy transition strategy while creating additional demand for domestically produced palm oil.
Under the new programme, biodiesel will consist of 15 per cent palm oil-based biodiesel, known as Palm Methyl Ester (PME), blended with 85 per cent petroleum diesel. The move replaces the existing B10 blend, which contains 10 per cent PME, The Star reported.
The government views the initiative as part of a broader effort to strengthen energy security, reduce dependence on imported diesel and provide greater support to the palm oil industry amid uncertainty in global energy markets.
The transition to B15 is expected to take place in stages, with authorities emphasising that the higher biodiesel blend can be used in most diesel vehicles without requiring engine modifications.
Deputy Prime Minister Ahmad Zahid Hamidi previously said the government intends to increase biodiesel production gradually before considering further increases in blend rates based on market conditions and industry readiness.
He also highlighted the potential of palm oil industry by-products, including sludge generated during crude palm oil processing, for use in biodiesel and aviation fuel production. According to him, this could help create new value-added opportunities within Malaysia’s commodity sector.
The government has assured industry stakeholders that the rollout will be carefully managed, taking into account palm oil availability, industrial preparedness and supporting infrastructure.
Plantation and Commodities Minister Noraini Ahmad said the B15 programme is expected to consume around 0.8 million tonnes of palm oil annually. She noted that this remains well below Malaysia’s estimated annual domestic palm oil surplus of approximately four million tonnes. Bioenergy Times
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Explainer: Inside Malaysia's B15 move
KUALA LUMPUR: Effective June 1, Malaysia will advance its energy transition by raising the Peninsular biodiesel blend from B10 to B15, a move aimed at easing dependence on imported diesel while giving a bigger role to palm oil in the country's fuel mix.
At its core, the policy means every litre of diesel will now contain 15 per cent palm-based biodiesel (palm methyl ester), up from 10 per cent previously. The rest remains conventional petroleum diesel. The change may appear technical but the impact is felt more in the backdrop of the economy, especially in plantations, refineries and fuel supply chains.
The B15 biodiesel will be produced by 19 licensed plants in an effort to lower diesel prices nationwide.
For Malaysia's palm oil industry, the shift translates into a meaningful lift in domestic demand. Annual usage for biodiesel is expected to rise to about 801,000 tonnes, compared with 534,000 tonnes under the B10 programme.
That basicially means that the additional uptake will provide a steady local market for crude palm oil (CPO) and support smallholders, even as overall supply remains comfortable at a surplus estimated at around four million tonnes.
Officials say the rollout will be phased to avoid price distortions in crude palm oil and to ensure producers can adjust smoothly. Importantly, the higher domestic usage is not expected to affect Malaysia's export flows, which stand at roughly 16 million tonnes a year. NST
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Malaysia unlikely to lose edge despite Indonesia FTA head start
KUALA LUMPUR: Indonesia's move to finalise a free trade agreement (FTA) with the European Union (EU) could sharpen price competition for Malaysian palm oil exports, but analysts say Malaysia is unlikely to lose its competitive edge in the global market.
Indonesia, the world's largest palm oil exporter, concluded negotiations with the EU on Sept 23 last year. The deal is undergoing legal review and ratification, with entry into force targeted for Jan 1 next year.
In contrast, Malaysia has made slower progress in its FTA talks with the EU, completing only the third round of negotiations in February this year.
The fourth round resumes this month.
Indonesia's palm oil exports were estimated at 23.6 million tonnes in 2025, generating US$24.4 billion.
Malaysia, the second-largest exporter, shipped 17.3 million tonnes of palm oil last year.
While smaller in volume compared with Indonesia, Malaysia maintains a strong position in higher-value segments, particularly certified and refined palm oil products.
Export earnings were estimated at about RM120 billion.
STRATEGIC MEASURES
Consulting firm ESG in Malaysia executive director Dr Harald Sippel told Business Times: "While there is a first-mover advantage, the situation is more nuanced than it appears at first glance."
Malaysia still has room to respond with its own strategic countermeasures, he added.
He said Indonesia's concluded Comprehensive Economic Partnership Agreement gives it an early platform in working with the EU on sustainability and compliance requirements under the EU Deforestation Regulation (EUDR), which now plays a bigger role than tariffs in determining palm oil market access.
"That said, Malaysia has been pursuing what I would describe as a parallel regulatory diplomacy track that the FTA timeline debate almost entirely misses.
"In September 2025, ahead of its own FTA conclusion, Malaysia secured recognition of its Malaysian Sustainable Palm Oil (MSPO) certification in a joint statement with the EU.
"This is significant because EUDR compliance hinges not just on tariffs but on whether a country's domestic certification scheme is recognised as credible.
"Malaysia moved on that front independently of its FTA timeline."
Sippel said Malaysia also concluded an economic partnership agreement with the European Free Trade Association (EFTA) states in June 2025, which includes a joint statement on palm oil.
He added that while the EFTA deal is not equivalent to an EU FTA, it helps establish frameworks and precedents that could support future FTA negotiations with the union. NST
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