Indonesia Set For Palm-oil Boost In Eu Trade Deal

The alleged Comprehensive Economic Partnership Agreement betwixt nan EU and Indonesia includes zero tariffs connected thenar oil.

EU Trade Commissioner Maroš Šefčovič (centre) and Airlangga Hartarto, Indonesia’s Coordinating Minister for Economic Affairs (right) astatine property convention announcing nan waste and acquisition agreement, 23 September 2025: Credit: EC – Audiovisual Service

The EU and Indonesia person concluded talks connected a free-trade woody that includes zero tariffs connected thenar lipid exports from nan South East Asian country.

The draught agreement, described by EU Trade Commissioner Maroš Šefčovič arsenic “a game-changer for some our economies”, removes Indonesia’s duties connected definite EU agri-food products.

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EU farming lobby groups Copa and Cogeca welcomed nan deal, which will caput to nan European Council and European Parliament for approval.

However, nan zero-tariff complaint connected Indonesian thenar lipid has attracted disapproval successful run circles.

Under nan agreement, thenar lipid from Indonesia will look zero tariffs wrong a defined quota. EU tariffs connected each thenar lipid imports scope up to 12.8%. Much of Indonesia’s thenar lipid shipments to nan EU already look a 0% tariff, Just Food understands.

The EU said nan alleged Comprehensive Economic Partnership Agreement, announced yesterday (23 September), includes a “protocol” connected thenar oil, “geared towards maximising nan imaginable of CEPA to support waste and acquisition successful sustainable thenar oil”.

In a statement, nan EU said: “It does truthful by establishing a level for dialogue, including connected regulatory developments of relevance for nan thenar lipid sector, and creating a model to activity much intimately together successful areas of circumstantial value for nan sustainability of thenar lipid production.”

Reacting to nan news of nan agreement, Eddy Martono, president of nan Indonesian Palm Oil Association (GAPKI), said nan woody was “good news” but he expressed interest astir nan EU’s planned deforestation regulations, aliases EUDR.

“The IEU-CEPA is bully news but if nan EUDR cannot beryllium fulfilled, past zero tariffs are useless. Our exports will still beryllium hampered,” Martono said successful a statement.

In a abstracted announcement yesterday, nan European Commission, nan EU’s executive arm, said it would propose different hold to EUDR coming into force.

The regulations were group beryllium implemented successful December aft already being pushed back.

Under EUDR, companies trading products including cocoa, java and thenar oil, arsenic good arsenic foods that incorporate nan ingredients, successful nan EU will person to show their proviso chains are free from deforestation-related impacts.

EUDR, first announced successful 2021, was primitively owed to beryllium enforced connected 30 December this twelvemonth but nan Commission faced pressure from parts of nan nutrient industry to widen nan deadline. Brussels agreed to a one-year hold past December.

IT problems person now led nan Commission to put guardant plans for different postponement of 1 year.

Fern, an NGO moving to protect forests and nan authorities of wood peoples, deed retired astatine nan woody betwixt nan EU and Indonesia and nan imaginable of different hold to EUDR.

“The woody reinforces an extractive exemplary which has already caused immense harm to Indonesia’s forests,” Fern campaigner Perrine Fournier said. “It contains nary tangible, foreseen benefits for those who person historically mislaid retired erstwhile waste and acquisition is liberalised – namely, indigenous communities, smallholders and workers. Instead, it strengthens nan already vice-like grip corporations clasp complete Indonesia’s forests.”

Fellow Fern campaigner Nicole Polsterer added: “Regardless of immoderate IT faults, complete nan past 12 months, we’ve witnessed a relentless effort to derail nan EUDR. This is portion of a wider battle: betwixt those who want to protect nan earthy world and nan life systems which dangle connected it, and those intent connected destroying it, often driven by constrictive self-interest.”

In July, Cadbury proprietor Mondelez International had called for a further hold to nan rules, arguing the rules had to beryllium “workable” successful practice.

However, a missive co-signed by rival cocoa makers Nestlé and Ferrero urged nan Commission to guarantee “the afloat preservation and swift, eager implementation” of EUDR.

The EU exports chiefly dairy and different animal products to Indonesia. Brussels said EU agri-food exports to Indonesia were worthy €1bn ($1.18bn) successful 2024. Indonesia’s main cultivation exports to nan EU are thenar oil, cocoa and coffee.

Farm Europe, a web of farming organisations successful nan region, including French farming federation FNSEA and Italian farming assemblage Coldiretti, said nan imaginable export opportunities successful Indonesia are “rather limited”.

“The main expected effect is connected Indonesian thenar lipid exports that will use from a tariff-free TRQ [tariff-rate quota] and a 3% tariff retired of quota. That is nan main Indonesian agriculture export. Regarding European imaginable export opportunities, nan expected effect is alternatively limited. Indonesia imports chiefly soybeans, beef, dairy, wheat, and atom to screen for home shortfalls,” Farm Europe said successful a statement.

“The EU will look beardown title connected beef from Brazil, Australia and nan US. On dairy, from New Zealand. On wheat from Russia, US. The EU doesn’t export soybeans, and, connected rice, it can’t compete against South East Asia.”