Jakarta. Indonesia’s export system shake-up has no immediate impact on its trade with palm oil importer Germany, according to an envoy, as Berlin keeps an eye on possible changes.

Indonesia’s trading partners are starting to speak up on Jakarta’s new trade regime one by one. President Prabowo Subianto has made a surprise move to bring exports of all of Indonesia’s strategic commodities under the control of a unit under the sovereign wealth fund Danantara in a move to tackle losses from under-invoicing. The one-gate export system currently covers palm oil, ferroalloys, and coal.

German Ambassador to Indonesia Ralf Beste stays positive that the policy will not undermine Berlin’s intention to grow trade, more so as the tariff-slashing accord by the European Union (EU) nears.

“That doesn’t say anything about the way that any country is organizing its trade. We see the reorganization is happening. I think there are still changes in that. We will try to take note and analyze that,” Beste told the press in Jakarta on Friday.

“As of now, I don’t see any immediate effect on the level of trade and the intensity that we have. There is room for enlargement anyway, and we won’t be impeded by that [policy]. I’m pretty optimistic.”

The new system is now in a transition period until Dec. 31. Exporters of the aforementioned commodities have to report their sales contracts to Danantara Sumberdaya Indonesia (DSI). The agency will have full control of the export process starting in January 2027, including the payment collection and shipments.

Indonesia reported that its trade with Germany had totaled roughly $6.1 billion in 2025. Throughout last year, German-bound exports under the sub-category “vegetable oils/animal fats” hit $78.6 million in 2025. Shipments dropped almost 70% year-on-year to just $8.2 million from January to April 2026. Palm oil falls under this sub-category.

Palm oil issues have complicated Indonesia-EU relations. The European grouping has rolled out the EUDR, an upcoming law that will require sellers of palm oil entering the EU market to provide a due diligence statement proving their products do not cause deforestation. The policy has rattled Indonesia over its impact on the smallholders. 

Beste did not deny the likelihood that either Prabowo or his German counterpart Frank-Walter Steinmeier would bring up the EUDR when they meet in Jakarta next week. However, the diplomat said that EUDR matters were usually discussed with EU authorities, although "a bilateral take is possible".

Asked if Germany is open to importing more Indonesian palm oil, Beste replied that such decisions would “ultimately hinge on the German consumers”, while pointing out “their critical take” on the suppliers’ sustainability.

“We align ourselves with the EU when it comes to the legislation and regulation. If there are complaints or qualifications from the Indonesian side, that would be a moment where these would be brought forth,” Beste said.

Jakarta is counting down to its free trade agreement with the EU, which is set to kick in early next year. This pact, dubbed CEPA for Comprehensive Economic Partnership Agreement, will eliminate virtually all tariffs.

An EU factsheet wrote that the deal would include an “export duty-free quota for crude palm and palm kernel oil”.

Indonesia is the world’s largest supplier of palm oil -- an agricultural commodity found in many everyday items such as cosmetics and snacks.

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