The Indonesian Trade Ministry’s new palm oil regulation (Permendag 16/2026) prioritises strengthening state-owned exporting companies while introducing a transitional framework for businesses to adapt ahead of full implementation, Indonesian news agency (ANTARA) reported.

The regulation, which replaces Ministerial Regulation (Permendag No. 26/2024), introduces a phased transition timeline designed to give private business actors time to adapt before full enforcement takes effect at the start of 2027, according to the ministry’s Acting Director of Agricultural and Forestry Product Exports, Bayu Wicaksono Putro.

Speaking at a virtual briefing in Jakarta, Bayu Wicaksono clarified that while the types of regulated commodities remain unchanged, the distribution channel is being tightly reined in.

"In terms of the structure of the articles, there are not many changes. However, there are adjustments in several articles, particularly those that include definitions, exports of exporting state-owned enterprises, and also regulations for the transition period," he explained.

The strategic natural resource commodities covered by the updated policy still encompass five main palm oil derivative products, including crude palm oil (CPO), refined bleached deodorised palm oil (RBDPO), refined bleached deodorised palm olein (RBDPL), used cooking oil (UCO) and palm residue.

Beginning January 1, 2027, all outbound shipments of palm oil derivatives can only be executed by designated exporting SOEs that hold a valid Export Permit (PE).

Under the new regulation, these state enterprises will secure export rights through either fulfilling the domestic market obligation (DMO) or the formal transfer of export rights from private business actors to the state-owned enterprise (SOE).

To ensure minimal market disruption, the government has instituted a structured transition period spanning from June 1 to December 31, 2026, granting commercial actors ample time to adapt to the centralised mechanism.

Bayu noted that all export permits cleared during this adjustment period will remain legally binding until December 31, 2026, at the latest.

To ensure the new mechanism does not bottle up Indonesia's massive palm oil trade, the government will launch an official evaluation of the policy within the next three months, led by the Coordinating Ministry for Economic Affairs.