Jakarta. Indonesia plans to impose an export levy on whole coconuts in a bid to regulate outbound shipments and secure domestic supply, Trade Minister Budi Santoso announced on Tuesday. The move comes amid soaring local prices and concerns over dwindling availability in traditional markets.

The proposed levy follows earlier discussions of a potential moratorium on whole coconut exports. Speaking at his office in Jakarta, Minister Budi, commonly known as Busan, said the new policy aims to balance export growth with local demand.

“Farmers prefer selling abroad where the price is significantly higher, while local markets suffer from limited supply,” Budi said. “By introducing an export levy, we can control the flow selectively and ensure adequate raw material for domestic industries.”

The ministry is finalizing the levy’s exact rate, with a decision expected later this week. “We hope to strike a balance between export opportunities and domestic needs,” Budi added.

The move comes amid a sharp surge in coconut prices. Grated coconut in local markets has doubled in price, now selling for Rp 14,000 to Rp 15,000 ($0.86 to $0.92) per piece, while farmers are getting up to Rp 6,000 at the farm gate. The spike, largely driven by increased overseas demand, has forced local processors to slash production, with many operating at just 30 percent capacity due to the cost of raw materials.

According to the Central Statistics Agency (BPS), Indonesia exported 431.91 million kilograms of whole coconuts throughout 2024, valued at $113.5 million. China was the top destination, importing 392.5 million kilograms worth $102.5 million, followed by Vietnam (31.3 million kg), Thailand (3.9 million kg), Malaysia (3.8 million kg), North Macedonia (81,000 kg), and several other countries totaling 180,100 kg.

In the first quarter of 2025, Indonesia exported 109.9 million kilograms of coconuts, with China remaining the dominant buyer at 103.6 million kilograms, followed by Vietnam with 2 million kilograms. Whole coconut exports reached $45.6 million as of March 2025, marking a 146 percent increase compared to $18.2 million in the same period last year.

Indonesia is the world’s largest coconut producer, with an annual output of about 17.19 million metric tons as of the last available data in 2022, according to the Food and Agriculture Organization (FAO). The Philippines ranks second with 14.93 million metric tons.