Malaysia, the world’s second-largest palm producer, increased the tax on exports of crude oil after prices climbed to the highest level since 2012.
Cargoes will be taxed at 5.5 per cent in April from 5 percent this month, according to a customs statement on the website of the Malaysian Palm Oil Board. The reference price for calculating the tariff was set at 2,598.76 ringgit ($795) a metric tonne, it said. Indonesia, the top supplier, kept its tax unchanged at 10.5 per cent for March from February.
Futures advanced 16 per cent in the past year and reached 2,916 ringgit on March 11, the highest level since September 2012. Reserves in Malaysia fell 14 per cent to 1.66 million tonnes in February from a month earlier, while production slumped 15 per cent to 1.28 million tonnes, the lowest since April 2012, data from the palm oil board showed. Exports lost 1.3 percent to 1.35 million tonnes, the lowest since July 2012.
“This is to be expected as CPO prices have been going up in the last month or so,” Ivy Ng, an analyst with CIMB Investment Bank Bhd., said in Kuala Lumpur. “Typically in a tight supply condition, exporters can try and pass on the export tax to the consumer. This could affect demand slightly. At this juncture, because the increase is 0.5 per cent, it should not be significant, so it should be absorbed.”
Shipments fell 21 per cent to 480,730 tonnes in the first half of this month from the same period in February, surveyor Intertek said March 15. The contract for delivery in June increased 0.7 per cent to 2,760 ringgit by the midday break on the Bursa Malaysia Derivatives in Kuala Lumpur.
