Jakarta. Indonesian palm oil is bound to keep its dominance in the US market, according to an industry association, as Washington grants the commodity levy-free access in the latest tariff barrage.

Indonesia has announced that the US would exempt certain products from its new Section 301 tariffs. Senior economic minister Airlangga Hartarto recently revealed that palm oil was on that list, although the US government had not yet released an executive order or announcement of this exemption.

Eddy Martono, who chairs the palm oil producers group Gapki, told the Jakarta Globe that this was good news for business.

“Tariff exemptions benefit both Indonesia and the US. Palm oil demand continues to grow in the US,” Eddy said via text on Thursday evening.

“A zero tariff will enable us to boost our palm oil exports. We hold 89% of the [palm oil] market share in the US.”

According to Gapki’s estimates, annual palm oil exports to the US have topped 2 million tons. Last year, the US-bound export volume reached 2.2 million tons. Rival producer Malaysia makes up the remaining market share. Palm oil is found in loads of everyday products, ranging from soap to cereals.

US President Donald Trump had already given Indonesian palm oil a 0% levy treatment under the reciprocal tariff agreement signed in February. The document, however, is still waiting for lawmakers’ approval on both sides. The original reciprocal tariff had faced legal impediments following a Supreme Court ruling in February. 

Since then, Trump has been trying to rebuild the tariff wall, most recently by launching investigations against Indonesia under the Section 301 trade provisions.

The first probe was into Jakarta’s crackdown on imports made by forced labor, which led to the US proposing a 10% tariff. Malaysia is also facing the same tariff rate. The other Section 301 probe -- which hits a dozen other countries -- is on whether Indonesia is producing more manufacturing goods than it consumes at home, thus displacing US domestic production.

The government has said that there is still a long way to go before the Trump administration decides the final tariff rates. The Section 301 tariffs will also likely enter into force after the current temporary 10% tariff expires on July 24.

Business lobby group Apindo said that Indonesia had been in a “relatively good position” in the Section 301 tariff saga.

“We don't see this as a situation that warrants panic. We must continue to keep an eye on the negotiation process and tariff exemptions to maintain Indonesia's market access to the US, especially for our leading products and labor-intensive sectors,” Apindo chairwoman Shinta Kamdani told the Globe.

Official statistics showed Indonesia-US trade amounted to $14.6 billion from January to April 2026. Jakarta enjoyed a surplus of almost $5.8 billion over the said four-month period.

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