<article><p><i>Adds comments from Starlax</i></p><p class="lead">Indonesian used cooking oil (UCO) supplier Starlax Energi Nusantara has denied that any of its containers were held by customs authorities earlier this year.</p><p>According to multiple market participants, who named Starlax as the supplier at the time, a 400t, 20-container cargo was due to be exported from Surabaya, Indonesia to Pasir Gudang, Malaysia on 9 February on the vessel Ever Boomy. But the shipment was halted when inspectors discovered it was labelled with customs code HS15180039, as opposed to HS15180031. The latter code is used for UCO by Indonesian customs and was restricted as part of a domestic market obligation (DMO) policy in place at the time.</p><p>Starlax did not respond to requests for comment at the time. But it now says its containers were never seized by authorities and that it did not use an incorrect customs code. The company says it has been using customs code HS15180039 for many years without any restrictions and did not try to bypass any restrictions. Customs code HS15180039 <a href="https://direct.argusmedia.com/newsandanalysis/article/2300141">was not included under the DMO</a>.</p><p>The containers have since been released by customs after Indonesia lifted its original restriction and replaced it with higher export levies for palm products, market participants said.</p><p>Jakarta had <a href="https://direct.argusmedia.com/newsandanalysis/article/2300141">implemented a 20pc DMO</a> on sellers of palm and a host of derivatives in January as the government looks to curb soaring prices that have hit record highs this year.</p><p>Jakarta reversed its policy again last month and implemented an <a href="https://direct.argusmedia.com/newsandanalysis/article/2326216">export ban on palm products</a> to curb record high cooking oil costs caused by depleted global supplies and the inflationary effect of the Russia-Ukraine war.</p><p>Indonesian UCO suppliers pushed back against the DMO, arguing that their product is not involved in palm oil production. The suppliers say they do not have access to domestic olein markets, and that the rules have therefore effectively cut off their sales.</p><p>A group of 13 suppliers who account for about 90pc of Indonesia's 25,000-30,000 t/month export sales in January formed a new grouping, the Association of Indonesian Waste Cooking Oil Exporters (AEMJI), to put up a united front against the new trade ministry regulations, but have had no success so far in changing the rules.</p><p>Starlax was part of that association, but said it has now left the group to focus on dealing with market uncertainty.</p><p class="bylines">By Amandeep Parmar</p></article>
