Indonesia Raises CPO Export Levy to 10% From 17 May 2025, Biodiesel FAME Levy at 4.75%

Jakarta — Indonesia has formally raised its export levy on crude palm oil (CPO) from 7.5% to 10% of the reference price, effective Saturday, 17 May 2025. The increase is set out in Finance Ministry Regulation (PMK) No. 30 of 2025, which also lifts the levy on biodiesel (FAME) exports from 3% to 4.75%. The proceeds are managed by the Plantation Fund Management Agency (BPDP) and are the main source of funding for the B40 biodiesel mandate.

According to Katadata, PMK 30/2025 on BLU BPDP service tariffs at the Finance Ministry was signed on 5 May 2025, promulgated on 14 May 2025 and took effect three days later. As DDTCNews noted, it revokes PMK 62/2024, which had set the CPO levy at 7.5%.

New rates by product group

BPDPKS President Director Eddy Abdurrachman, quoted by IDX Channel, said the levy is now split into five product groups. Based on reporting by DDTCNews and IDX Channel:

Group	Example products	Old rate	New rate
I	FFB, palm kernels, kernel meal, empty fruit bunches, shells	Specific rates (US$0–25/tonne)	Unchanged
II	CPO, crude palm kernel oil, POME oil, HAPOR	7.5%	10%
III	Crude palm olein/stearin, PFAD, PKFAD	6%	9.5%
IV	RBD palm oil, RBD palm olein, RBD palm stearin	4.5%	7.5%
V	Biodiesel (FAME)	3%	4.75%

The percentage rates are applied to the CPO reference price set monthly by the Trade Minister, and payment is made in rupiah at the prevailing exchange rate. IDX Channel reported that the adjustment follows a decision by the BPDPKS Steering Committee, chaired by Coordinating Minister for Economic Affairs Airlangga Hartarto. Under the transitional provisions, levies collected under PMK 62/2024 from 17 January 2025 until the new rule took effect remain recognised as BLU BPDP revenue.

Plugging the B40 subsidy gap

The regulation's preamble says the adjustment is needed to raise productivity and add value to downstream plantation products. The Jakarta Post reported that the extra money will go to the biodiesel programme and replanting. Indonesia subsidises biodiesel to meet its B40 target, using levy proceeds to cover the cost gap that arises because palm oil is more expensive than fossil crude.

The hike had been flagged since December 2024, when Airlangga said the levy would rise to 10% once the Finance Minister's regulation was issued, according to Indonesia Business Post. The same outlet reported BPDPKS estimates that subsidy needs could rise by up to 68% as the mandate moves from B35 to B40, while the 2025 biodiesel allocation was targeted at 15.62 million kL.

Industry and farmer objections

Indonesian Palm Oil Association (GAPKI) chairman Eddy Martono, quoted by The Jakarta Post from Bisnis, said the higher levy would erode the competitiveness of Indonesian palm oil, which is already priced above neighbouring producers. He said the industry already carries three burdens — the domestic market obligation (DMO) for cooking oil, the export levy and the export duty — totalling about US$221 per tonne, assuming a CPO price of IDR 14,000 per kg. GAPKI had not yet calculated the added cost of the 10% rate.

Smallholders voiced opposition as soon as the plan was announced. Oil Palm Farmers Union (SPKS) chairman Sabarudin, in a Republika report sourced from Antara in early January 2025, estimated that a 2.5 percentage point increase could push fresh fruit bunch (FFB) prices down by around IDR 300–500 per kg, as levy costs tend to be passed down to the weakest link in the chain. SPKS urged the government to review the biodiesel subsidy model and improve transparency and feedstock traceability.

The CPO reference price used to calculate the levy can be tracked on our prices page, while related rules are listed in the biodiesel regulation data.