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Oil report

Indonesia to revamp palm oil levy to support biodiesel programme

JAKARTA, Sept 8 (Reuters) - Indonesia, the world’s largest palm oil producer, plans to revise its palm oil export levy rules to allow higher collection when prices increase, a senior cabinet minister told Reuters, as part of moves to underpin an ambitious biodiesel programme.

Since June this year, Indonesia has collected a maximum $55 levy per tonne on palm oil exports, regardless of the price.

But the new levy collections will hinge on export prices, Coordinating Minister for Economic Affairs Airlangga Hartarto said in an interview on Tuesday.

“So every increase by $25, it will increase the levy by $5,” Hartarto said.

Indonesia collects the levy to finance the gap between the production cost of fuel made from palm oil and from the crude oil price.

Reporting by Gayatri Suroyo, Tabita Diela and Ed Davies Additional reporting by Bernadette Christina Munthe Writing by Fransiska Nangoy

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