InfoSAWIT, JAKARTA – As part of an inclusive development vision, palm oil plantation management will continue to prioritize a balance between economic growth and community welfare. The sustainable synergy between the palm oil business and local communities remains a commitment to support a more prosperous rural economy.
Vice Chairman of the Indonesian Plantation Entrepreneurs Association (GPPI), Dedi Junaedi, highlighted the importance of collaboration among various stakeholders to advance the palm oil sector and enhance farmer welfare, especially in transmigration areas. He emphasized the significant role of palm oil as a driver of regional economies.
Dedi explained that the palm oil sector has become one of the main sources of income and employment in many regions and is Indonesia's second-largest foreign exchange earner after coal. However, despite its economic potential, the palm oil industry faces challenges related to productivity, legality, and energy resilience. The government is currently strengthening this sector through the B50 biodiesel program and supporting smallholder palm oil plantation rejuvenation.
According to Dedi, one of the main obstacles for independent smallholder farmers is limited access to high-quality seeds and sustainable farming resources. "Seed quality greatly impacts harvest yields, but unfortunately, many farmers still use uncertified or low-quality seeds," he said at the 16th Sustainable Palm Oil FGD titled “Sustainable Palm Oil Plantations for Rural Economic Development,” organized by InfoSAWIT and supported by BPDPKS, on Friday, November 1, 2024, in Jakarta.
He also emphasized that the high initial investment in palm oil plantations can be burdensome for farmers, especially if the seeds planted are not productive.
GPPI is also promoting sustainable certifications like RSPO and ISPO as standards for accessing export markets and securing better selling prices. However, funding challenges continue to hinder smallholders from meeting these certification standards. Dedi noted, “Currently, government support is crucial to strengthen institutional capacity and equip farmers with best practices in cultivation.”
Additionally, GPPI encourages the formation of cooperative institutions among palm oil farmers to strengthen their bargaining position in selling harvests. "Independent smallholders need to step up—not just as fresh fruit bunch sellers, but as producers of processed palm oil products with added value," Dedi added.
Looking forward, GPPI plans to accelerate the implementation of carbon certification programs for palm oil plantations, aimed at supporting the government's national carbon emission reduction targets.
Dedi concluded his remarks by emphasizing the importance of collaboration between the central and regional governments, along with all stakeholders, to ensure the sustainability of the palm oil sector. GPPI hopes that these efforts will enhance smallholder welfare and position Indonesian palm oil as a globally competitive commodity. (T2)
