JAKARTA, July 22 (Xinhua) -- Indonesian Trade Minister Zulkifli Hasan said Friday that the government was mulling over a plan to revoke the domestic market obligation (DMO), a policy for mandatory local sales, to boost crude palm oil (CPO) exports and raise fresh fruit bunches (FFB) prices.
The DMO, he said, would be lifted right after palm oil companies in the country had fulfilled the demands for domestic supplies.
"I have scheduled to talk about the plan with the related stakeholders. If the companies can be committed to always fulfilling the domestic needs, I think the DMO policy is no longer necessary," Hasan told reporters.
"The main purpose is we want to boost exports and, as a result, raise prices of fresh fruit bunches from the farmers to at least 2,000 rupiahs (0.13 U.S. dollars)," he added.
In April, the Indonesian government temporarily banned exports of CPO and its derivative products to stabilize prices and cooking oil supplies in the local market.
Lifted in May, the ban had caused an oversupply in FFB harvesting. All this time, 70 percent of the country's palm oil production goes to the export market, according to the Indonesian Palm Oil Association (GAPKI).
Hasan said that current palm oil stocks in Indonesia had excessively reached 7 million tons, which had caused FFB prices to slump to 1,200 rupiahs (0.08 dollars) per kilogram.
As another effort to increase FFB prices and palm oil exports, the Finance Ministry has also lowered the export levy rate to 0 until the end of August. ■