Based on the reference price, CPO export tax will be set at $93 per tonne in February, while the export levy will be at $255 per tonne.

Meanwhile, cocoa export tax will stay at 5% next month.

Source: Agriculture.com

It has a bold, vegetal, rich and smoky paprika-like flavour that enhances spicy foods and is widely used in Africa, India, Southeast Asia and Indonesia. It is perfect for adding flavour to stews, soups sautés and stir fries. It is also an amazing base for curries and ethnic dishes.

The benefits of red palm oil include slowing progression of heart disease. It boosts brain health, improves hair and skin health, enhances Vitamin A status, reduces oxidative stress, helps prevent cell damage and reduces cholesterol levels.

Tip: Once the container is opened, red palm oil is best refrigerated or stored in a cool, dark place for a longer shelf life. Simple recipe: Cut cauliflower, button mushrooms, broccoli, coloured peppers, brussel sprouts and courgette it into bite-sized pieces then toss with red palm oil and season with salt and pepper. Bake for about 15/20 minutes at medium-low heat.

Source: Standard Media

“This will help the economic recovery. Either the coal, crude palm oil (CPO), or rubber, all rise,” said the state head at the 11th Kompas100 CEO Forum as quoted from the Youtube channel of Harian Kompas on Thursday, Jan. 21.
He assessed that in the medium term, the new normal would affect the entire living pattern of the people and the economic structure would revive in the future as the pandemic is successfully contained.

Jokowi emphasized that the health protocol would still be enforced in all aspects of life, including in economic activities. “There will definitely be a new protocol for such as eating in a restaurant, boarding a plane, taking public transport, working in a factory to protect our health,” he said.

Source : Tempo.co

No country is immune to the rapid disruption occurring in the global energy sector. New technological innovations in both supply and demand have changed the technical versus economic discourse. Renewables are now cheaper than any fossil fuel in most parts of the world. And Indonesia’s no exception to this transition as per IEEFA.

The sharp decline in power demand due to slower economic growth has forced the State Electricity Company (PLN) to carefully rethink its investment plans. In the last semester, PLN began rebranding itself as a green(er) utility company through a number of so-called breakthrough initiatives. Going forward, the state-owned utility company is committed to providing clean and sustainable energy for Indonesia in line with government expectations, a measure likely to be attractive to ESG (environmental, social and governance) investors.

Despite this commitment, the government appears to favour the opposite strategy. While nations across the globe are competing to accelerate the development of inherently deflationary technologies in solar, wind and storage, the Indonesian government seems to be focusing on centuries-old technologies that have previously failed to gain market share.

As per the IEEFA note three recent energy investment decision with government require government backing require careful scrutiny.

The first is the political push for coal down streaming technology. The government wants to turn unsellable domestic low-rank coal into syngas (synthesis gas) to then be processed into methanol, dimethyl ether (DME), urea and other compounds. DME would then replace, to some extent, imported liquefied petroleum gas (LPG), a commodity that weighs on Indonesia’s trade deficit.

A recent study by IEEFA  also found that if the USD 2 billion DME project initiated by state-owned PT Bukit Asam goes ahead, it would lose USD 377 million annually. This would exceed any savings made from reduced LPG imports by USD 19 million, assuming that global LPG prices remain below USD 470 per ton.

The government’s second plan to create a domestic market for local raw fuel products focuses on replacing imported diesel with B30, B50 and/or B100 biodiesel mix to capitalize on Indonesia’s palm oil production surplus. Unfortunately, this plan suffers from the same price risk as the proposed DME production projects.

The third energy proposition that calls for deeper scrutiny is PLN’s proposal to pursue cofiring at scale by converting 114 units at PLN’s existing 18 GW coal-fired power plants to accommodate 5-10 percent biomass cofiring.

The country is blessed with many energy options. The government’s concerted effort to use conventional domestic fuel sources, albeit with good intentions, is contrary to the global, technology-driven energy trends of the last 5 years. Indonesia has many renewable and sustainable fuel options that could be prioritised instead. For instance, solar and wind are free and have no related price risk.

The note concluded by stating that when considering investments in increasingly obsolete energy infrastructure, the government should weigh the costs of achieving energy independence and the subsidies required to feed fuel sources of the past. Investing in cheaper, deflationary renewable energy projects is the better option for PLN and the government as we enter the recovery period.

Source: Saur Energy

According to Airlangga, the agricultural, forestry, and fisheries sector is the third-largest contributor to Indonesia’s GDP. Social distancing measures across various regions have disrupted the agricultural product distribution and thus causing a downtrend. Even so, the agricultural sector is far more pandemic-resilient than their industrial counterparts.

“Whereas the palm oil industry employs over 16 million people and contributes an average of $20 billion per annum. We also see the palm oil industry still positively contribute to the economic activities amid the Covid-19 pandemic,” Airlangga told an online conference held by the Indonesian Palm Oil Association (Gapki) on Wednesday.

The minister forecasts palm oil demand to recover as economies reopen. Palm oil price is expected to rise to $668 per metric ton next year from $650, following the increasing demand from large trading partners and biodiesel policy.

“But the real question is how can we affirm that the palm oil industry contributes not only to the economy but also the social and environmental aspects of the community. And the answer is effectively implemented regulations and among them is the recently enacted job creation law,” Airlangga said.

The 2020 Law on Job Creation helps create more jobs by boosting investment and ease of doing business. This also manifests in the government’s interest to improve people’s welfare while being in line with environmental protection, he added.

Also, President Joko “Jokowi” Widodo has rolled out several instruments for a more sustainable palm oil industry.

The 2018 Presidential Instruction on Palm Moratorium and Palm Oil Productivity Escalation aims to restrain further plantation expansion and ensure the permits have met the sustainability standards. The 2019 Presidential Instruction on the National Action Plan on Indonesian Sustainable Palm Oil comprised the 2019-2024 roadmap for the government and stakeholders to balance socio-economic development and environmental conservation, Airlangga said.

In March, the president also signed a regulation to support the Indonesian Sustainable Palm Oil (ISPO) certification system. The government has made the certification mandatory for both companies and farmers, although smallholders have five years to become certified.

The government has allocated funds for plantation replanting in Riau, North Sumatera as well as South Sumatera. The program is to ensure land legality, increase productivity, income, and sustainable practices by smallholders.

Replanting is also included in the government’s plan for national economic recovery. To this end, the government has teamed up with companies.

“Among these cooperations is to expedite the replanting process through subsidized microloans [KUR] disbursed by banks,” Airlangga said.

Thank You, B30!

According to Gapki’s Chairman Joko Supriyono, the pandemic has taken a toll on palm oil exports following lockdowns worldwide. However, the domestic consumption was able to withstand its impact thanks to the government’s mandatory use of B30, a diesel fuel made of 30 percent palm oil biofuel.

“The government is consistent and persistent in implementing the B30 mandate despite the low fossil fuel price. This helps to stabilize our domestic consumption,” Joko said.

“We will continue to support the government program to maintain the sustainability of the biofuel mandate as well as to ensure 100 percent recovery in the domestic market,” he added.

Joko highlighted the domestic consumption increase was also thanks to oleochemicals. This palm oil derivative is commonly used in personal hygiene products such as hand sanitizers and soap, which have become a staple to keep the virus at bay.

Source: Jakarta Globe

Its chief executive officer Datuk Dr Kalyana Sundram contends that soy, sunflower and canola are so far behind in proving their sustainability, there is little chance that they can catch up to palm oil in time to meet the proposed legislations in the European Union (EU) and the United Kingdom (UK).

He acknowledged that the EU and UK were looking to reduce deforestation in imports.

Stressing a point In the virtual International Palm Oil Sustainability Conference (IPOSC 2020) hosted by the MPOC recently, he said despite rapeseed’s scandalous distinction, its import and use for the EU’s biofuel requirements get a free pass with no questions asked about its sustainability.

“Canada, as one of the biggest sources of rapeseed for biofuels in the EU, also gets ‘unfettered access’ to the EU’s biodiesel market,” he noted.

Kalyana further pointed out that soy as a vegetable oil with the largest terrestrial footprint in the world, was able to avoid the spotlight.

“With the wildfires burning forests in South America on a scale that made the 2015 fires in Indonesia look like a campfire, the scale of soy’s impact in the world was peeled back just enough to raise global alarms,” he said.

Citing independent study findings, he said the global palm oil industry, with a terrestrial footprint that contributed 2.3% to deforestation, pales in comparison to deforestation caused by the meat and soy industries.

“Today palm oil ranks among the most consumed of the 17 different competing oils and fats. This progressive rise up the ladder has also come with a hefty price to the industry straddled with a myriad of controversies, critics and accusations of unsustainable operations throughout the supply chain,” he said.

The industry expert stressed that if there is a silver lining to the criticisms and controversies concentrated on palm oil, it has to be the fact that the industry is most ready to prove itself as a solution for mitigating climate change and biodiversity preservation.

“The greatest con against sustainable edible oils is being allowed by the EU. Under political and economical pressure by the US, soy has been recognised by the EU as a sustainable source of biofuels despite all the evidence against its sustainability.

“Soy is such a sacrosanct commodity that even vegans who boycott palm oil vociferously defend the inclusion of soy in their diet by insisting that soy is grown as animal feed. What of soy lecithin which is a common replacement as a food emulsifier and which competes in the same segment as palm oil derived emulsifiers?”

Kalyana also slammed international media for suppressing palm oil while supporting the soy and rapeseed oil industries, adding that the news media is the one fight that the MPOC must win as a first step in its endeavours to have all edible oils treated fairly.

Source: The Edge Market

Indonesia, which has one of the world’s most ambitious biodiesel programmes, raised the bio-content in its biodiesel mandate to 30% (B30) late last year from 20% (B20) before, and is planning to upgrade the bio-content gradually to 100%.

“This trial shows that our refinery and catalysts are ready. Next, we have to think how to make the economic side work too,” Pertamina CEO Nicke Widyawati said in a statement.

In Indonesia – the world’s largest palm oil producer – the bio portion of biodiesel is made with fatty acid methyl esters (FAME) from palm oil, but efforts to increase FAME concentrations in biodiesel have faced resistance from users.

While biodiesel can cut fuel costs and reduce emissions, higher blends of FAME require special handling and equipment as the fuel has a solvent effect that can corrode engine seals and gasket materials, and it can solidify at cold temperatures.

Instead of using crude palm oil to create FAME and mixing it with regular diesel, the D100 “Green Diesel”, processes refined, bleached and deodorized palm oil straight into its refinery using catalytic cracking and hydrogen gas, the statement said.

The biodiesel programme is a key part of the government’s strategy to soak up excess supplies of palm oil and curb expensive fuel imports, one of the main contributors to the country’s current account deficit problem.

In May, Indonesia said it is likely to delay plans to raise bio-content in palm oil-based biodiesel to 40%, amid speculation that low crude prices could force a government re-think. (Reporting by Wilda Asmarini, writing by Fathin Ungku; editing by Emelia Sithole-Matarise)

Source: Reuters

Franky Widjaja, head of one of the world’s biggest palm plantation companies, warned that the European Union’s plans to restrict use of the tropical oil in biofuel will misfire as the move will hurt growers and jeopardize future supplies of the vegetable oil.

The world needs palm oil as supplies from alternative oilseeds just won’t be enough to meet rising demand for food and fuel, said the chairman and chief executive officer of Singapore-based Golden Agri-Resources Ltd., and scion of one of Indonesia’s richest families. Buyers and suppliers will probably end up compromising to find a solution to the dispute, he said in an interview.

“I believe in karma, and I think they will get their karma,” the 61-year-old said last week, adding the EU limits on use in biofuel are irresponsible because they threaten the incomes of 17 million people in Indonesia.

The dispute between the 28-nation bloc and some of the world’s leading developing nations escalated this year as Indonesia and Malaysia, which together supply about 85 percent of the world’s palm oil, warned that they are ready to retaliate against what they see as “discriminatory” rules.

While the EU says palm oil leads to deforestation and climate change, producing nations say the claims are misleading and detrimental to countries that depend on the industry. Palm exports fetched Indonesia $17.8 billion last year and the industry contributes about 3.5 percent to gross domestic product.

The world needs the oil because the most efficient oil to produce in the world is palm, so “why you have to exclude palm oil and plant more soybean, rapeseed in order to get very little oil?” said Widjaja, whose company manages more than 498,000 hectares of palm plantations in the Southeast Asian nation.

Compromise Likely

“At the end of the day you need to sit down, after you fight and you are tired, and you compromise,” Widjaja said, referring to the way the dispute may be resolved. “Everything is like that in the world.”

Producers of palm oil, used as cooking oil and in everything from candy to cosmetics and biofuel, have been hit by declining prices and rising labor and sustainability costs. Golden Agri reported a net loss of $1.77 million for 2018, compared with a profit of $74 million a year earlier.

Widjaja reiterated that demand from energy will be an important catalyst in eventually boosting palm prices. Indonesia’s biodiesel consumption is expected to rise by 50 percent this year to about 6 million kiloliters, thanks to President Joko Widodo’s policy of promoting usage to soak up excess supply, he said. China’s use of palm methyl ester, a biodiesel made from palm oil, in shipping fuel is also seen boosting exports, he added.

Golden Agri, which sold an oilseed crusher in the northern Chinese city of Tianjin to agricultural trader Louis Dreyfus Co. in late 2017, will keep its 1-million-ton soybean processor in the eastern city of Ningbo as a strategic asset, Widjaja said. “You have some of your feet on the ground, which you can feel the water cold or hot,” he said. “I think it will add value rather than decreasing value to hold it.”