Indonesia hopes to keep duty-free palm oil exports to the US
Indonesia is negotiating with the US to preserve duty-free access for crude palm oil and other key exports despite new US tariffs. The bilateral agreement continues to exempt Indonesian palm oil, while the country’s lower 10% tariff reflects compliance with US forced labour-related trade requirements.
Indonesia hopes the United States will honor its commitment to maintain duty-free access for selected imports, including crude palm oil, despite the implementation of new US tariffs ranging from 10% to 12.5% on dozens of trading partners. Indonesia received the lowest tariff rate of 10%.
The Indonesian government said it would continue negotiations with the Office of the US Trade Representative to preserve preferential access for key agricultural commodities. Under the bilateral trade agreement signed in February, Indonesian crude palm oil, cocoa, coffee and natural rubber were granted zero-duty access to the US market.
The new US tariffs are linked to investigations into the use of forced labor in global supply chains. Washington noted that Indonesia has legislation banning imports associated with forced labor, which was one of the reasons for applying the lower tariff rate to the country.
The US has also introduced a special mechanism allowing Indonesian textile products to enter at reduced tariff rates provided they contain US cotton and other American inputs. The official documents further confirm that Indonesian palm oil remains exempt from tariffs under the bilateral trade agreement.
Trade between Indonesia and the United States increased by 7.6% year-on-year to $18.4 billion in the first five months of 2026. Indonesia posted a trade surplus of about $7 billion over the period, a key factor behind Washington’s efforts to reduce trade imbalances.
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Source : Ukr Agro Consult
