Indonesia, US Still Negotiate Tariff Cuts for Palm Oil Ahead of Tomorrow’s Deadline
06/08/2025 (Jakarta Globe), Jakarta - Indonesia and the US are still negotiating lower tariffs on palm oil although it is only one day away before Washington’s duty hikes come into effect.
US President Donald Trump will soon impose 19 percent tariffs on US-bound Indonesian goods on August 7 or tomorrow. Indonesia has requested lower tariffs on commodities that the US cannot produce, including palm oil, closer to zero percent. As the deadline nears, senior minister Airlangga Hartarto said Wednesday that Indonesia was still trying to secure tariff reductions for palm oil.
“It’s still in process,” chief negotiator Airlangga told the Jakarta Globe, before heading to the palace.
Aside from palm oil, the resource-rich Indonesia is seeking lower rates for its nickel, cacao, and coffee.
When Trump first launched his tariff campaign in April, Indonesian palm oil producers feared that they could lose their market share to ASEAN neighbor Malaysia. The US mainly buys its palm oil from Indonesia, seconded by Malaysia. However, Indonesia managed to get Trump to drop his initial 32 percent tariffs to 19 percent after making some trade concessions. Trump’s reciprocal tariff threats started out with 24 percent in April, and later slightly rose to 25 percent in July. Kuala Lumpur ended up with 19 percent, just like Jakarta.
Trump has already slapped 10 percent universal tariffs on foreign goods entering his country since April in an attempt to fix trade imbalances. The policy did not stop the US from being Indonesia’s largest surplus driver, with the trade gap amounting to $8.57 billion between January and June. Indonesia's overall exports of crude palm oil and its derivatives were on the rise so far this year. Exports hit $11.43 billion in the first half of 2025, up by 8.91 percent year-on-year, according to the Central Statistics Agency (BPS). The agency, however, did not go into details on who Indonesia's top buyers were.