Malaysia keeps CPO export duty unchanged but raises reference prices

Malaysia has raised its crude palm oil reference price on the month, but it has kept its export tax unchanged at the current maximum rate of 8%, the Malaysian Palm Oil Board (MPOB) said on Wednesday.

The reference price for crude palm oil has been increased to MYR 4,627.40/mt ($1,121.31/mt) from MYR 4,533.40/mt ($1,099.35), effective from 1 June until 30 June 2021.

Export duties remain unchanged at their maximum rate of 8% as crude palm oil prices remain above the threshold of MYR 3,450/mt.

A higher reference price will result in a slight increase in net payable export duties, with the June export duties calculated at MYR 370.19 ($89.63/mt), from MYR 362.67/mt (87.95/mt) in May.

But “the rise [in net payable duty] of MYR 7.52/mt ($1.80/mt) from May is negligible and it is unlikely to reduce Malaysia CPO export competitiveness to Indonesia,” Sathia Varqa of Palm Oil Analytics told Agricensus.

Palm oil prices at the Bursa Malaysia reached MYR 4,506/mt on 12 May, the highest level ever traded on the benchmark contract, supported by the overall supply tightness seen in the vegetable oil complex.