Indonesia Controls Request for Palm Oil Requirements in Pakistan

INDUSTRY.co.id - Jakarta - Indonesia is able to control the needs of palm oil products in Pakistan. This is due to the support of Indonesia's export tariff policy which is considered more competitive to be a driver of the high interest of the country's buyers of palm oil.

"Indonesia implements a palm oil export duty policy that is more competitive than Malaysia," said Abdul Rasheed Janmohammed, Pakistan Chief Executive Edible Oil Conference, in Nusa Dua, Bali, last week.

In 2015 and 2016, Indonesia's palm products have an average of 80% more than Pakistan needs. For information, olein and RBD Palm Oil (PO) products from Indonesia are more in demand by Pakistan's processing industry.

In comparison, Pakistan imports 1.06 million tonnes of Indonesian olein and RBD PO is 978 thousand tons in 2016. Meanwhile, imports of olein and RBD PO from Malaysia are 241,961 tons and 99,184 tons.

According to Abdul Rasheed, Indonesia can increase its market share as long as it can improve the tariff structure for crude palm oil or CPO products.

Indonesia's CPO exports to Pakistan amounted to 28,425 tons, below Malaysia at 96,894 tons in 2016.

Currently Pakistan and Indonesia are in the process of evaluating the Preferential Trade Agreement (PTA) agreement that was inaugurated in 2013. In the first meeting of August 2016, the two countries listed the issues concerning the implementation of PTA during the first three years.

Indonesia and Pakistan agreed to take new steps to address the problem. While in its second meeting in February 2017, Indonesia-Pakistan will also re-review the progress achieved in the PTA cooperation.

After the signing of the PTA, the total trade volume of both countries was 1.6 billion US dollars in the first year and reached 2.1 billion US dollars in 2015. Pakistan has become the fourth largest importer of palm oil from Indonesia. (SI)