KUALA LUMPUR, (Reuters) – Malaysia may reduce its palm oil export tax and slow down its implementation of the biodiesel mandate in order to meet world demand. This is according to a commodities minister.

Zuraida Kamaruddin, Plantation Industries and Commodities Minister, stated in an interview that her ministry had already suggested the reduction to the Finance Ministry. The ministry also established a committee to investigate the matter.

Malaysia is second in palm oil production, and she suggested that the tax could be reduced to between 4% and 6%, instead of the current 8%.

According to Zuraida, the cut will likely be temporary. A decision can be taken as soon as June.

She said, “During these times in crisis, maybe we can relaxa bit so that palm oil can be export more.”

Malaysia’s share of the edible oil markets is expected to grow after Russia’s invasion in Ukraine cut off sunflower oil shipping. Indonesia’s ban on palm oil exports also tightened supply.

The market has been rattled by the lack of top-producing Indonesian palm oil, which is used in almost 60% of all global vegetable oils shipments.

Zuraida said that importing countries asked Malaysia for a reduction in its export tax, while others, such as India, Iran, and Bangladesh, are offering barter trade.

Malaysia is also expected to slow down the implementation of B30’s biodiesel mandate. This mandate requires that a percentage of biodiesel be blended with 30 percent of palm oil in order to prioritize supply to the food industry, she stated.