Indonesia ups palm export levies to fund B30 mandate

Indonesia is hiking palm oil export levies for a second time this year to help fund its 30pc biodiesel in transport fuel mandate (B30), with the change to take effect from 10 December.

Crude palm oil (CPO) levies will start at $55/t when prices are at or below $670/t. They will then rise on a sliding scale to a maximum of $255/t when CPO moves above $995/t.

Biodiesel duties will range from $25/t when CPO prices are below $670/t to $192.50/t when they move above $995/t.

Palm olein levies will rise from $20/t to $187/t for the same CPO price range.

These changes have been mooted since September and are a sharp rise from the flat $55/t duty on CPO and $25/t duty on biodiesel that have been in place since June.

Indonesia uses the proceeds from these duties to bridge the gap between biodiesel and fossil fuel diesel prices in the country, but has struggled to fund its B30 programme this year amid high feedstock palm oil and low gasoil costs.

Jakarta set its December biodiesel price at 9,505 rupiah/litre ($771/t), down from Rp9,329/litre in November, keeping its biodiesel formula price at $85/t above CPO.

By Amandeep Parmar