25/05/2012 (Bangkok Post) - The government, bowing to pressure from the private sector, has agreed to scrap a plan to import crude palm olein (CPO) and institute an export surcharge, according to Deputy Prime Minister Kittiratt Na-Ranong.

Industry associations accused the Commerce Ministry of distorting the data on CPO stocks that led to the approval to import 40,000 tonnes of CPO, 10,000 tonnes of which have already been imported.

In an attempt to control the retail price of bottled cooking palm oil at 42 baht a litre, the ministry announced it will also impose a levy of 10 baht a litre on CPO exports.

Mr Kittiratt said fresh palm nut has already been harvested, so there is no need to import the remaining 30,000 tonnes.

As chairman of the National Palm Oil Policy Committee, he plans to discuss with the Commerce Ministry the cancellation of the export surcharge, as the measure is an obstacle to exports during the harvest period.

"The public needs to understand why the government approved the import of 40,000 tonnes of CPO. The information showed the stockpile had fallen to unsafe levels. However, if the situation has changed, then the government needs to revise the policy," said Mr Kittiratt.

Wiwan Boonyaprateeprat, secretary-general of the Thai Oil and Palm Oil Association, said after the announcement of the new surcharge, buyers cancelled orders. As a result, the private sector is unlikely to export CPO next month.

The global CPO price has dropped due to the European debt crisis.

She anticipates that CPO exports will pick up after July when Muslim countries purchase the product for Ramadan.

The Office of Agricultural Economics reported exports of 94,000 tonnes of CPO in the first quarter. Exports were 331,000 tonnes last year and 65,000 tonnes in 2010.

The oil policy committee agreed to conduct a study to determine a retail price for cooking palm oil that would be fair to all parties _ farmers, manufactures and consumers.