Existing agreements between Israel and the PA prohibit any boycott of Israeli goods. The PA is always careful to emphasize that they boycott goods made by Jews in Judea and Samaria but not from within the Green Line.
They are not positioning this as a boycott, but rather as a means to protect local farmers who they say have higher costs and cannot compete with the Israeli product.
However, it is possible that this is a tentative step in the direction of actually boycotting Israel itself.
As usual, Palestinian Arabs (besides farmers) will be the losers, as they will have to fork over more money for their produce.
Right now, some 76% of PA imports are from Israel, and 91% of its exports are to Israel. If they want to start a boycott, they have a lot more to lose than Israel does.