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An industry association has revised upward Indonesian's
exports of palm oil products to India after the latter cut import
duties last week.
Indonesian Palm Oil Producers Association executive director Derom
Bangun said Monday that with lower import duties, Indonesia could
export up to 1.4 million tons of palm oil products to India in 2006,
higher than the previous estimate of 1.3 million tons.
Last week, in a bid to lower domestic prices of edible oils and curb
inflation, India cut its import duties on palm oil to 70 percent from
80 percent. It also cut the duty on refined bleached and deodorized
palm oil to 80 percent from 90 percent.
Derom said that despite the upward revision, Indonesia's palm oil
exports to India in 2006 would be lower than last year's 1.96 million
tons due to an increase in the South Asian country's palm oil
production.
"With the estimated increase in domestic production, India is likely
this year to import only about 2.2 million tons of palm oil, far lower
than the four million tons last year," he said.
India uses palm oil for producing cooking oil, soap, industrial
lubricants and detergents.
Derom said he was optimistic that this year's export target of 1.4
million tons of palm oil to India could be achieved as exports during
the first three months had already reached 456,031 tons.
Based on this figure, India bought the biggest percentage of
Indonesia's total palm oil exports of 2.48 million tons in the first
quarter, followed by China, which bought 322,556 tons, he said.
"With the increase in exports to India, I estimate that Indonesia's
total palm oil exports in 2006 will increase to 11.3 million tons from
10.38 million tons in 2005," Derom told The Jakarta Post.
The estimated increase in total palm oil exports would be supported by
a projected 14 percent increase in production to 15 million tons this
year from 13.6 million tons in 2005, he said, adding that part of the
production would be sold on the domestic market.
The demand for palm oil in Indonesia is 3.5 million tons per year for
use in the production of cooking oil, instant noodles, soap and
chemical oil, with the rest of the country's production being exported,
he added.
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