REPUBLIKA.CO.ID, JAKARTA - Palm oil association set the export target of crude palm oil (CPO) at 21 million tonnes in 2013 or an increase by 18.1 million tonnes from previous year.

The Head of Marketing of Indonesian Palm Oil Association (GAPKI), Susanto, said Indonesia targeted the production of CPO to reach 28 million tonnes. With the local consumption only 6.5 to 7 million tonnes, the remaining will be exported.

"The export of CPO is only 42 percent while the rest is its products," Susanto said on Tuesday. 

Indonesia is currently competing neck and neck with Malaysia in term of CPO market. Moreover, Malaysia has decreased the export tax. Effective on January 1, Malaysia has implemented progressive export in 2013. The tax will be 4.5 percent when the CPO price in international market is 2,250 to 2,400 Malaysian ringgits per tonnes and 8.8 percent when the price is 3,450 to 3,600 ringgit per tonnes.

Meanwhile, Indonesian export tax is still 9 percent. With the difference on export tax, if the price of CPO is under 2,250 ringgits, Malaysian export tax will be 0 percent, while Indonesian export tax is still 5 percent. Susanto worried that Malaysia would snatch Indonesian CPO market, which reaches 5 to 5.7 million tonnes.

Gapki predicts that the CPO price in the first three months will be 800-900 USD as it depends on European economic condition and weather. The price is expected to increase in April-July. However, he is pessimistic that the price will surpass 1000 USD per tonnes.

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