CPO Export Tax Waiver Seen As Timely To Address Excess Supply

KUALA LUMPUR, Oct 20 (Bernama) -- Malaysia’s proposed crude palm oil (CPO) export tax waiver of 10 per cent for November is seen as a timely measure to address excess supply and improve export competitiveness, said Public Investment Bank Bhd (PIVB).

In a note today, PIVB said the proposed waiver comes as Malaysia seeks to boost shipments amid elevated palm oil inventories, with a discussion between the Plantation and Commodities Ministry and industry players understood to be scheduled for today.

PIVB said the move is expected to be well received by the industry and could take effect soon.

“The waiver of CPO export tax will help Malaysia regain market share from Indonesia,” it said.

PIVB also suggested that the waiver remain in place until Malaysia’s palm oil inventory falls below two million tonnes.

Malaysia fully waived its CPO export tax for six months in 2020.

However, PIVB said the proposed measure could have varying implications across the palm oil value chain. Upstream players could benefit from stronger export demand, while downstream players may face margin pressure due to higher raw material costs.

-- BERNAMA