KUALA LUMPUR: Malaysia announced on Friday it would fully exempt palm oil from export duty this year, in a move that traders estimated could boost shipments of the edible oil by 1 million tonnes in the second half of year.
Prime Minister Muhyiddin Yassin announced the exemption as part of an economic stimulus package to revitalise industries badly hit by the coronavirus pandemic. Malaysia’s finance ministry said on Friday the country’s economy could contract as much as 4.7 per cent this year due to the Covid-19 pandemic.
Exports of crude palm oil, crude palm kernel oil and processed palm kernel oil will all be exempt from duties from July through to December.
The world’s second largest producer and exporter of the edible oil had already lowered its export duty in crude palm oil to zero per cent for June only.
“This will definitely help us further increase Malaysia’s palm oil exports, especially to India,” Malaysian Palm Oil Board chairman Ahmad Jazlan Yaakub said in a statement.
The duty exemption gives Malaysian crude palm oil a price advantage over Indonesian crude palm oil, and could increase exports by an additional 1m tonnes, said Sathia Varqa owner and co-founder of Singapore-based Palm Oil Analytics.
Published in Dawn, June 6th, 2020