Malaysia to scrap crude palm oil export quota, change tax system
KUALA LUMPUR (REUTERS) - Malaysia, the world's No. 2 producer of palm oil, will scrap a tax-free export quota for the crude grade from next year in a bid to reduce feedstock prices for refiners who have lost market share to top supplier Indonesia.
Malaysia plans the step in tandem with a cut in crude palm oil export taxes, also slated for next year, as it moves to help refiners offer cheaper cargoes, Commodities Minister Bernard Dompok said on Friday.
The measures could help boost exports next year and give some support to benchmark Malaysian palm oil futures, which have lost 23 per cent so far this year.
Minutes after the government announced the plan on Friday, the market tumbled more than 4 per cent as traders had expected a more immediate policy move to help cut into Malaysian stocks that hit a historic high of 2.48 million tonnes last month.