https://opiej.mpob.gov.my Oil Palm Industry Economic Journal Tue, 28 Aug 2018 07:07:53 +0000 en-US hourly 1 https://wordpress.org/?v=7.0 https://opiej.mpob.gov.my/an-analysis-of-indonesias-palm-oil-position-in-the-world-market-a-two-stage-demand-approach/ Tue, 28 Aug 2018 07:07:53 +0000 https://opiej.mpob.gov.my/?p=271 Read more]]> Indonesia and Malaysia are the major producers of palm oil in the world. Together they contribute almost 87% of the world production in 2007, while in the export market, they contribute 91% of the world palm oil export. This article analyses Indonesia’s palm oil position in the world market. A two-stage demand equation was constructed. The first equation analysed the world demand without considering the source of the product. Meanwhile, the second equation considered the source of the product using the almost ideal demand system (AIDS) approach. Considering the stationarity of the data, the error correction mechanism (ECM) was employed. The result shows that the increase in the world demand for palm oil is mostly contributed by the increase in world income. In addition, palm oil products from Indonesia and Malaysia are complementary to each other rather than competing. Therefore, both countries should co-operate in order to increase the world demand for palm oil in the future.

]]> https://opiej.mpob.gov.my/impacts-of-cpo-export-tax-on-several-aspects-of-indonesian-cpo-industry/ Tue, 28 Aug 2018 04:32:20 +0000 https://opiej.mpob.gov.my/?p=168 Read more]]> To control domestic supply and price of crude palm oil (CPO) and cooking oil, the government of Indonesia has imposed CPO-export tax since August 1994. As the CPO industry plays an important role in Indonesian economy, the imposition of the tax is expected to have substantial impacts on various aspects of the industry, such as on investment, production, trade, farm income and welfare distribution. The main objective of this study is to assess these impacts using an econometric model of the industry. The results of the study reveal that the export tax policy has inhibited the growth rate of investment, production, export and farm income. On the other hand, this policy has been an effective instrument to control domestic CPO and cooking oil price. Moreover, this policy has caused a substantial welfare transfer from producers to consumers and the government. To compromise these conflicting impacts, an alternative CPO tax formula is also proposed in this paper.

]]>