November 1, 2018 / 4:11 AM / 10 months ago

UPDATE 1-Indonesia considers reducing its levy on palm oil exports

* Indonesia is reviewing its palm oil levy -minister

* Govt to discuss adjustment in next two months (Recasts on minister comment that levy cut is still being considered; adds comment, background)

NUSA DUA, Indonesia, Nov 1 (Reuters) - Indonesia is considering reducing its levy on palm oil exports, a government minister said on Thursday, as the nation pushes to maintain its position in international markets for the commodity.

Indonesia’s coordinating minister for economic affairs, Darmin Nasution, said during a speech at an industry conference in Indonesia that an “adjustment” to the levy was among steps to be taken by the government, although he later told reporters that this was still being discussed.

“We don’t have final position yet,” Nasution said on the sidelines of the event on the island of Bali.

“We have to calculate that carefully. We don’t want lowering it only to result in lower prices.”

Indonesia, the world’s top producer of the commodity, currently imposes a levy of up to $50 per tonne on various palm oil products.

Indonesia’s palm oil association, GAPKI, said last week that it had proposed cutting the palm oil export levy by $20 per tonne until prices of the vegetable oil reach $700 per tonne.

The government’s reference price for crude palm oil has stayed below $750 per tonne for over a year.

Nasution said the government would discuss the levy adjustment intensively over the next two months, hoping to reach a decision around year-end. (Reporting by Fransiska Nangoy and Bernadette Christina Munthe; Editing by Kenneth Maxwell and Joseph Radford)

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