Commodities

Commodities: Indonesia may double the tax on CPO exports to 6% next month as prices continue to advance. Exports may ease in Sep as exporters boost shipments this month to avoid paying higher tax. Indon reviews the duty every month to ensure local supply & to reduce swings in cooking oil prices. M’sian palm oil futures in M’sia, rose to RM2,730, +20% from near its 8-mth low in July. Indon will impose a 1.5% duty if the avg price is at least US$700/ton, 3% tax between US$751-800 & a max 25% if CPO climbs to US$1,250. Palm oil averaged US$872 in mth to Aug 19. The decision comes at the time when demand is high due to festivals in China, India & Muslim countries. Higher duties will curtail exports & cap the profit margins of the CPO players.