Proposed tax cut not likely to boost Malaysia’s palm oil exports by much: analysts

Malaysia - the world’s second-largest palm oil producer behind Indonesia - has announced plans to increase its exports, and it is also mooting a proposal to temporarily cut its export tax on the commodity in a bid to boost its global market share.

Observers say, however, that these moves will not have a significant impact on the country’s palm oil industry if the government does not take steps to resolve the sector’s labour shortages.

Malaysia is widely seen as a major beneficiary after Indonesia banned edible palm oil exports with effect from April 28 this year, and Russia’s invasion of Ukraine disrupting sunflower oil shipments to many parts of the world. Palm oil accounts for about 60 per cent of global vegetable oil shipments.