Indonesia's crude palm oil export expected to rise this year amid rising prices

The country's association of palm oil growers known as GAPKI has disclosed that shipment of the commodity overseas is forecast to rise to 27 million tons this year, compared with 25.1 million tons last year.

Last year, the shipment of the commodity decreased 5 percent from that of at preceding year, partly due to weakening global demand, it said.

Rising global oil price has also led other commodities prices rising, including crude palm oil prices.

For shipment this month, the government has applied a 18 U.S. dollars-per metric ton export tax for crude palm oil, rising from a 3 U.S. dollars-per metric ton for shipment in January, according to Dody Edward, director general of foreign trade of trade ministry.

The significant hike of the tariff was due to increase of the commodity reference price for February of 3.46 percent to 815.52 U.S. dollars per metric ton, he said.

On production, the association has estimated it would rise this year due to La Nina weather phenomenon happening last year.

Chairman of GAPKI Joko Supriyono has said that the association forecast the output of the commodity will rise to 32 to 33 million ton this year from 30 to 31 million ton last year.

In 2015, production of CPO reached 32.5 million ton compared with 31.5 million ton in 2014, the association has revealed.

Average prices of CPO last year was at 790 U.S. dollars per metric ton, rising from 557 U.S. dollars per metric ton at the beginning of the year, said Supriyono, chairman of the association.

"...CPO prices have gradually risen along with rising global demand," he said.

The government's mandatory bio-diesel program has contributed to prevent prices from declining.

The program obligates the usage of bio-fuel of 20 percent.