TAWAU: The proposed tariff hike by the United States (US) is not expected to affect the prices of the country’s export commodities, particularly palm oil, said Deputy Plantation and Commodities Minister Datuk Chan Foong Hin.
He said this is because the US is not a major market for Malaysian palm oil, as the country only imports about one per cent of palm oil from Malaysia.
“The US has its own soybean oil industry and is, in fact, a competitor of ours in the edible oils market.
“Therefore, any proposed tariff by the US on palm oil is not seen as particularly disruptive…however, it may affect market sentiments in terms of demand, as there is uncertainty and concern over what might happen next.
“When anxiety increases, demand could be impacted, which could in turn cause a slight drop in export,” he said after officiating the Tawau District-level Oil Palm Smallholders Replanting Financing Incentive Scheme (TSPKS 2.0), here, on Thursday.
He added that another important factor to consider is that the US has imposed a higher tariff on Indonesia (34pc) compared to Malaysia (24pc), creating a tariff gap that makes palm oil from the neighbouring country less competitive in the US market than Malaysia’s.
At the same time, Chan expressed confidence that the Malaysian Government delegation to the US for negotiations on the tariff issue would help prevent the global market from heading into a state of uncertainty.
“With the recent announcement by the US of a 90-day postponement of the tariff implementation, including for Malaysia, I am very confident in the mission of the Malaysian delegation.
“To address this issue, the Malaysian Government has already established the National Geoeconomic Command Centre (NGCC), chaired by the Prime Minister,” he said.
