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 that in an interview, her ministry already recommended the cut to finance ministry. They have set up a committee for investigation.

Malaysia is second in palm oil production, and she suggested the possibility of reducing the tax by 4% to 6%, instead of the current 8%.

Zuraida stated that the reduction would be temporary, and that a decision could be made in June.

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

Malaysia wants to increase its market share in edible oils after Russia invaded Ukraine and stopped sunflower oil shipment. Indonesia also banned palm oil exports, further tightening global supply.

Nearly 60% of world vegetable oil shipments are made from palm oil, which is widely used in baking and detergent. The absence of Indonesia as a major producer has caused market turmoil.

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’s B30 biodiesel mandate will be delayed by Malaysia, who requires that some biodiesel from the country must be mixed with 30% palm oil to ensure supply to food businesses.