R.E.A. Holdings Responds to New Export Tariffs

R.E.A. Holdings plc ("REA") has issued an update on recent changes to export tariffs for crude palm oil (CPO) and crude palm kernel oil (CPKO) by the Indonesian government. Effective from 22 September 2024, the government has modified the export levy structure.

The export levy will now be a fixed 7.5% against the CPO reference price, with no upper or lower limits, replacing the previous incremental levy system. This change retains the sliding scale export duty with capped limits. The new export tariff structure will be subject to review after six months.

For September, the CPO reference price is $839.53, resulting in total export tariffs of $115 per tonne for CPO and $148 per tonne for CPKO. This marks a decrease of $27 per tonne from the prior structure. REA sells CPO domestically in Indonesia, which is not subject to these tariffs. However, local prices generally align with international prices after adjusting for delivery costs and export tariffs, indirectly affecting REA's selling prices.