US Backs Removing 19% Tariff on Indonesian Palm Oil, Cocoa, Rubber

Indonesia’s chief tariff negotiator, Coordinating Minister for Economic Affairs Airlangga Hartarto, said the United States has agreed in principle to exempt Indonesian palm oil, cocoa and natural rubber from a 19% import tariff that Washington introduced on 7 August. Hartarto told Reuters the two sides still need to finalise the deal, but the consensus is for the duties to fall to zero or near-zero because the United States does not produce the commodities domestically. The talks also covered a possible U.S. investment in fuel-storage infrastructure in Indonesia, involving the sovereign wealth fund Danantara and state-owned energy company Pertamina, according to the minister. A timeline for both the tariff rollback and any energy investment has not been set as Washington continues parallel negotiations with other trading partners. Separately, Malaysia’s Plantation and Commodities Ministry said it has asked the Finance Ministry to exempt crude palm-kernel oil and palm-kernel olein from the country’s 5% sales and services tax, arguing the levy raises costs for its oleochemical sector. The request underscores how Southeast Asia’s major palm-oil exporters are seeking tax relief to preserve competitiveness amid shifting trade policies in the United States and elsewhere.