This article first appeared in The Edge Malaysia Weekly on November 2, 2026 - November 8, 2026

Malaysia cannot afford to drag its feet on a proposal to temporarily suspend crude palm oil (CPO) export duties as the industry grapples with mounting stockpiles and intensifying competition from Indonesia.

Last week, Plantation and Commodities Minister Datuk Seri Noraini Ahmad said her ministry held an engagement session with industry players on Oct 20 to receive feedback on the plan. However, she clarified that any decision on an exemption or deferment of the tax falls under the Ministry of Finance, which was also represented at the meeting.

The urgency is clear. Malaysia’s palm oil stock surged to a record 3.51 million tonnes in September, driven by all-time high monthly production alongside a slowdown in export demand. Industry players called for a three- to five-month suspension of CPO export duties to stimulate shipments, ease inventories and improve industry competitiveness.

Currently, Malaysia imposes export duties of between 3% and 10% on CPO when prices exceed RM2,250 per tonne, with the maximum rate applying above RM4,050. The duty remained at 10% for November, based on a reference price of RM4,323.78.

A temporary waiver could give Malaysian palm oil exporters greater pricing flexibility and help the country protect and reclaim market share from Indonesia, the world’s largest palm oil producer.

Discussions on the proposal have been ongoing since October. With November already here, the government should avoid further delays and make a prompt decision.

This is not a call for a permanent tax exemption but a temporary measure to help the industry navigate an exceptional supply situation. The waiver could remain in place until inventories return to a more manageable level.

In a highly competitive global market, timing matters. Malaysia must act decisively now or risk allowing Indonesia to widen its advantage.

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