JAKARTA – The European Union (EU) Deforestation-Free Regulation (EUDR) that has been adopted since 16 May 2023 has caused the decrease of Crude Palm Oil (CPO) exports. As a result, Indonesia has to find new export markets outside of EU for its palm oil products.
The Indonesian Palm Oil Association (GAPKI) Chairman Eddy Martono said that Indonesia is seeking to increase its palm oil exports to China. GAPKI and the maritime and investment coordinating ministry (Kemenkomarves) have coordinated with the trade regulator of China regarding a plan to sign a memorandum of understanding (MoU) to increase Indonesia’s palm oil exports to China. Eddy said that based on the MoU, Indonesia is expected to increase palm oil exports to China up to more than 7 million tons per year.
“Yesterday, facilitated by Kemenkomarves, we’re talking with China’s Chamber of Commerce and Industry. They’ve asked for an increase of palm oil imports from Indonesia. This is what we should follow up next month. During the working visit of President Joko Widodo (Jokowi) we’ll sign the MoU on increasing our palm oil exports to China,” Eddy said after a public discussion on palm oil in Kawasan Tendean, Jakarta, on Monday, 26 June 2023.
Eddy admitted that it is difficult to find new markets for palm oil exports, especially because the EU countries have been long the importers of palm oil from Indonesia. “But despite the fact, Indonesia shouldn’t rely on the European market. The more so because the demand from the European countries has been declining during the last few years.
“We cannot reorient our exports outside EU outright now. But we need to start from now. I do agree that we should not rely too much on the EU market. We need to find other new promising markets like China,” said Eddy.
“China has a very large population, and it’s now the largest importer of our palm oil products,” he said.
According to Eddy, the need of Chinese industries for palm oil products is very high. During 2021, China imported 7 million tons of palm oil from Indonesia. But in 2022 after the Covid-19 pandemic, its palm oil imports decreased to 6 million tons.
Eddy said that the reason China interested in importing palm oil from Indonesia is because its price is more competitive than the prices of other vegetable oils. Besides, the palm oil can also be used by various industries as raw material to produce soaps, lipsticks, foods and beverages. (*)
Source: kumparanBISNIS
