Indonesia and Malaysia to jointly deal with CPO embargo threat.
Indonesia and Malaysia have agreed to form a joint minister Group
to deal with the palm oil embargo threat by the United States. Deputy
agriculture minister Rusman Heriawan said the agriculture ministers of
two countries would leave together for the United States to discuss that
matter in their US counterpart. A regulation of US Environmental
Protection Agency (EPA) bans the use of crude palm oil from Indonesian
and Malaysian as feedstock for bio-fuel. CPO from the world's two
largest palm oil producers is considered not up to EPA emission
standards. Earlier US agriculture attache Dennis Voboril said the United
States still is importing CPO from Indonesia as well as from Malaysia
but not for use to feed bio-fuel factories. The Indonesian Palm Oil
Commission accused the United States of being unfair saying the US
regulation of Notice of Data Availability is discriminating against CPO.
The regulation does not give equal treatment for CPO as for as
vegetative oil produced by the United States, it said. The price of
crude palm oil (CPO) was expected to increase on shrinking supply from
in Malaysia despite negative sentiment with expected slowdown of Chinese
economy, analysts said. Malaysian CPO stock has dropped to its lowest in
six months in February after shrinking production in previous four
months, said Ariana Nur Akbar from Monex Investindo Futures Malaysia is
the world's second largest producer of CPO after Indonesia. China,
one of the largest CPO market has revised down its economic growth
target to 7.5% from 8%.