Indonesia palm oil shares, rupiah rattled by export ban

By Gayatri Suroyo and Bernadette Christina

JAKARTA, April 25 (Reuters) - Shares of some of Indonesia's biggest palm oil companies slumped on Monday, while the rupiah headed currency falls in Asia, after the government announced it would ban palm oil exports later this week to help control domesticcooking oil prices.

Indonesia, which is the world's top producer and exporter of the edible oil, sent a shockwave through markets last Friday by announcing the ban from April 28, which could further inflame surging global food inflation.

Meanwhile, shares of palm oil companies in rival exporter Malaysia jumped as palm oil futures FCPOc3 rose to their highest since early March.

The rupiah IDR=, which had been relatively stable this year, buoyed by record high Indonesian exports, fell as much as 0.65% on Monday.

Trading in the currency was affected by the export ban as well as hawkish comments on tightening monetary policy by U.S. Federal Reserve officials, the head of Indonesia's central bank monetary management department Edi Susianto said.

"Of course, BI (Bank Indonesia) ensures that we will be in the market ... to maintain that the rupiah exchange rate does not move with very high volatility that has the potential to disrupt the market mechanism," he told Reuters in a text message.

Indonesia's Astra Agro Lestari AALI.JK and Triputra Agro Persada TAPG.JK suffered share losses of more than 6%. Salim Ivomas Pratama SIMP.JKand Sinar Mas Agro Resources and Technology SMAR.JK also dropped, while shares of Singapore-listed Wilmar International WLIL.SI saw a more limited fall.

Malaysian companies that registered share price gains included FGV Holdings FGVH.KL, Sime Darby Plantation SIPL.KL, and IOI Corp IOIB.KL. Malaysia is the world's second-biggest palm oil exporter.

Indonesia's exports of palm oil and its derivatives usually amount to $3 billion a month, according to some analyst estimates.

The resource-rich country has ridden a boom in exports since last year on the back of an upswing in global commodity prices, but its government has also been scrambling to try to control jumps in local food and energy prices.

"The recent cooking oil policy has created concerns about the current account outlook as CPO (crude palm oil) is a major Indonesian commodity," Jakarta-based Trimegah Securities economist Fakhrul Fulvian said, commenting on the rupiah's fall.

"The government needs to adjust this policy as limiting exports will put the economy in more harm than good," he said, suggesting authorities provides more cash transfer to help the poor cope with high commodity prices instead of halting exports.

(Reporting by Bernadette Christina Munthe and Gayatri Suroyo in Jakarta and Mei Mei Chu in Kuala Lumpur Editing by Ed Davies)

((gayatri.suroyo@thomsonreuters.com; +622129927609; Reuters Messaging: gayatri.suroyo.thomsonreuters.com@reuters.net))

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