FILE PHOTO: Workers load palm oil fresh fruit bunches to be transported from the collector site to CPO factories in Pekanbaru, Riau province, Indonesia. REUTERS/Willy Kurniawan
JAKARTA: Indonesia will suspend some palm oil export permits to secure domestic supply amid rising cooking oil prices ahead of Islamic festivals, senior cabinet minister Luhut Pandjaitan said on his official Instagram account.
He said palm oil exporters had accumulated large shipments quota from last year and they now had little incentives to supply the domestic market.
Indonesia issues export quotas for palm oil companies which have sold a proportion of their products to the domestic market, under a policy known as "Domestic Market Obligation" (DMO).
The DMO currently allows export volumes of six-times what the companies have sold at home.
Luhut said "exporters can use those export rights after the situation has calmed."
Firman Hidayat, an official at the Coordinating Ministry of Maritime and Investment, said around a third of the total exports quota could be used now, while the rest could be used after May 1.
Exporters could increase the quota when they raised supplies to the domestic market, he said. - Reuters
