Jakarta – Indonesia's trade surplus likely shrank significantly in May because of a drop in exports after the government banned shipments of palm oil products, while imports were seen rising more quickly, a Reuters poll showed on Tuesday.
Eighteen economists in the poll had a median forecast of $3.83 billion trade surplus for May, about half of April's record $7.56 billion surplus.
Indonesia, the world's top exporter of palm oil, banned exports of the vegetable oil for three weeks to May 23, and shipments have since been slow to restart due to red tape. Palm oil products usually make up about 14 per cent of the country's exports.
Economists in the poll predicted exports to rise 38.69 per cent on a yearly basis in May, slower than April's 47.76 per cent, while imports were seen expanding 32.8 per cent from a year earlier, against April's growth rate of 21.97 per cent.
Faisal Rachman, an economist at Bank Mandiri who expected a $5 billion surplus in May, said high global commodity prices had continued to prop up exports, but an improvement in the domestic economy means imports will pick up pace.
"We expect the current account balance to record (a) surplus in 2022. We still expect that the trade surplus in this year's current account balance is inclined to shrink," Faisal said.
The May trade data will be released on Wednesday.
[Polling by Devayani Sathyan and Anant Chandak in Bengaluru; Writing by Stefanno Sulaiman; Editing by Gayatri Suroyo and Kanupriya Kapoor.]