InfoSAWIT, JAKARTA - Palm oil production or products that many consumers still question, become parts of palm oil business progress in the world. The latest was that European Union gets closer regulation to palm oil distribution by publishing European Union Deforestation Regulation (EUDR). This could be an issue to develop palm oil business in the world.
In general, European Union Parliament rejection to crude palm oil (CPO) and its derivative products happened for being considered to create deforestation, land, animal degradation, corruption, child labor, and human rights violation. The rejection took place for many years until many regulations were published to stop the trade in the continent.
Though European Union regulates palm oil trade in the globe by publishing closer regulations, the people in the continent prefer palm oil for it is healthy and cheap. This becomes the benchmark of palm oil trade that gets more in the globe.
The increasing palm oil consumption in the world that should qualify sustainability, of course, would be the benchmark on the successful improvement in sustainable and best cultivation practices that many planters, including smallholders, did in Indonesia. It is normal if many palm oil plantation companies and smallholders successfully got sustainable certificates.
The 2023 statistic data by Indonesian Palm Oil Association (IPOA) revealed that CPO production in Indonesia reached 50,07 million tons and palm kernel oil (PKO) reached 4,77 million tons. They increased from the previous year that reached 7,15% and 5,66%. The domestic consumption escalated to be 23,13 million tons in the same year. The domestic trade was contra with CPO exports to European Union that decreased up to 11,6%.
Of course, the decreasing CPO consumption in European Union could be the strong signal for many stakeholders nationally to improve, get new breakthroughs for other vegetable oil producers in European Union Parliament. Not only palm oil plantations, the smallholders should take part to deliver the right understanding about palm oil cultivation practices.
Reinforce Smallholders
The smallholders’ existence that cultivated about 42% of palm oil plantations in Indonesia, makes palm oil as the economic pillar for the people of Indonesia. If CPO and its derivative products always get trouble to be sold to European Union, the smallholders would be difficult to survive.
That is why by having and implementing some initiatives that non-government organizations developed and trained, many smallholders in this country start implementing sustainable and best practices. In addition, the Government of Indonesia has implemented Indonesian Sustainable Palm Oil (ISPO) certification mandatorily for the stakeholders and smallholders.
The sustainable principles and criteria implementation based on universal assessment successful should be the new power to develop palm oil business in the world including in Indonesia. That is why it needs to get more cooperation between the plantation companies and smallholders in the future.
The partnership between both parties that has been running since 1980s can be encouraged to be more transparent and open cooperation because the partnership with smallholders would be part of palm oil development successfully.
The smallholders’ palm oil plantations would be potentially be the equal partners for the companies to cultivate theirs to be more productive and environmental. The partnership should be equal and transparent to get the same progress.
It would be the strong modal for Indonesia to convince other stakeholders and European Union Parliament that sustainable and best practices have been implemented. Palm oil is the only commodity in vegetable oils that implement sustainable principles and criteria universally.
This power would answer the deadlock trade in European Union. The consumers should trust that their consumption derived from responsible sources. In addition, business gets not only material profits only but also collaborates with other stakeholders to maintain man’s sustainability and the environment. May it be.
By: Ignatius Ery Kurniawan
