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By Bernadette Christina and Fransiska Nangoy<\/p>\n
JAKARTA (Reuters) - Indonesia is expected to export 27.5 million tonnes in 2025, a decline of 6.9% from last year, the largest local palm oil industry group, the Indonesian Palm Oil Association (GAPKI), said on Thursday.<\/p>\n
The world's biggest exporter of the commodity is struggling to increase production of the vegetable oil as its trees age, at a time when it is also expanding mandatory blending of palm oil into biodiesel.<\/p>\n
The drop would extend the contraction already seen in 2024, of 8.3%, when Indonesia exported 29.54 million tonnes of palm oil products, according to GAPKI data.<\/p>\n
Indonesia's marginal output growth in 2025, coupled with higher domestic demand, is expected to dampen export prospects, Hadi Sugeng, an association representative, told reporters.<\/p>\n<\/p>\n
\u201cExports tend to fall year by year, in contrast to domestic consumption,\u201d Hadi added. \u201cMeanwhile, our production is only moderate.\u201d<\/p>\n
GAPKI estimated total palm oil production at 53.63 million tonnes this year, including about 48.98 million tonnes of crude palm oil, only a slight increase from last year's output.<\/p>\n
In 2024, Indonesia produced 48.16 million tonnes of crude palm oil and had stocks of 2.58 million by the end of 2024, GAPKI said.<\/p>\n
Tight exports have pushed up palm oil prices on global markets [POI\/], which GAPKI warned would reduce competitiveness against rival vegetable oils.<\/p>\n
\u201cPalm oil is no longer a cheap vegetable oil,\u201d Hadi added. \u201cIt is often more expensive than other vegetable oils, causing importers, especially India, to buy the cheaper ones.\u201d<\/p>\n
(Reporting by Bernadette Christina Munthe, Fransiska Nangoy)<\/p>\n<\/p><\/div>\n