KUALA LUMPUR (Reuters) - Pakistan may sign by mid-2010 a preferential tariff pact with Indonesia for palm oil imports that will divert some of the South Asian countrys orders from Malaysia, a top industry official said on Thursday. Rasheed Janmohammad, vice-chairman of the Pakistan Edible Oil Refiners Association, said the new tariff agreement would limit Pakistans reliance on Malaysia, which has a crude palm oil export quota of 3m tonnes. At the moment, Malaysias share (of palm oil imports) is 95pc and it could become 75pc if the Indonesian Free Trade Agreement is signed, Janmohammad told Reuters ahead of the Bursa Malaysia Palm Oil Conference next week. Pakistan, the worlds fourth largest importer of vegetable oil, bought 1.791m tonnes of edible oils in 2009. Of that volume, 97pc was palm oil cargoes. The South Asian country will probably buy 1.7 million to 1.8m tonnes of vegetable oils this year, Janmohammad said. Malaysia and Indonesia are the worlds largest palm oil producers, accounting for 80 percent of total supply. Indonesian officials said in early February that they hoped to sign a palm oil agreement with Pakistan this year but did not give a time frame. IMPORT DUTY As the worlds top palm oil producer, Indonesia has been pushing for the import duty charged by Pakistan to be reduced to the same level as products from Malaysia for the past two years. Pakistan now charges import duty of 8,900 rupee per tonne on Indonesias crude palm oil, but charges 15 percent less for the same product from Malaysia as a result of a tariff agreement signed in 2007 between the two countries. Traders say Pakistan consumes about 3 million tonnes of edible oils a year, but produces only 500,000-800,000 tonnes of cottonseed, rapeseed and sunflower and has to rely on imports to meet about 80 percent of demand. Pakistan has mostly depended on Malaysia for its palm oil needs but last year officials criticised the Southeast Asian country for delaying the renewal of 3m tonne crude palm oil quotas given to Malaysian plantation companies. Usually the permits for the quotas get renewed in December but it was delayed to mid-Jan,Janmohammad said. Almost all our refineries had to shut down because shipments were delayed and we prefer to import crude palm oil than palm olein to support our processing industry. Malaysia sets a quota for crude palm oil exports as it wants its customers to focus on higher valued refined palm oil products. Countries like Pakistan and India are increasingly moving from refined palm oil imports to cut down on expensive cargoes and support their refiners.