Indonesia Risks Losing US Palm Oil Market to Malaysia Amid Tariff Dispute

Indonesia could lose its palm oil market share in the US to Malaysia if it fails to secure a lower import tariff, warned the Indonesian Palm Oil Association (Gapki). Currently, US President Donald Trump plans to maintain Indonesia’s import duty at 32 percent while Malaysia’s rises slightly to 25 percent. Gapki’s international affairs head, Fadhil Hasan, said this would shift US imports towards Malaysia. Last year, Indonesia exported 2.2 million tons of palm oil to the US, worth $2.9 billion. With new tariffs looming by August 1, Indonesia is also pushing for trade diversification, finalising a CEPA with the EU by September, and exploring pacts with Turkey and African nations. However, EU non-tariff barriers, including its anti-deforestation law, remain a challenge. Fadhil stressed that Indonesia previously lost Turkey’s market to Malaysia due to its 2015 free trade agreement and urged Jakarta to prioritise new trade deals urgently.