Malaysia keeps September palm oil export tax unchanged at 10%, reference price slightly reduced

⑴ The Malaysian government announced on Monday that the export tax rate for crude palm oil shipments in September will remain unchanged at 10%, as the country’s benchmark reference price remains in the high range, in line with market expectations.⑵ The official reference price for September is set at 4,392.32 ringgit per ton, a slight decrease from August’s 4,412.19 ringgit, but still significantly higher than the tax trigger threshold of 2,250 ringgit.⑶ Malaysia implements a progressive export tax system, with rates ranging from 3% to 10%. The taxation mechanism is activated when the crude palm oil price exceeds 2,250 ringgit, and the current price level has triggered the highest tax bracket.⑷ The benchmark palm oil contract for November delivery on the Malaysia Derivatives Exchange saw a slight increase intra-day, with the overall market responding moderately, indicating that the decision to maintain the tax rate has been fully priced in. Subsequent attention will focus on weather in major producing regions and demand changes from key importing countries as drivers for price movement.