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Palm Oil Industry Survives During Pandemic, Sustainability Increases

Illustration. Photo: Unsplash.com
Palm Oil Industry Survives During Pandemic, Sustainability Increases

InfoSAWIT, JAKARTA - The withering of the national economy due to the Covid-19 pandemic has been felt since the beginning of 2020, even the Indonesian economy was decline 2020 (fourth quarter of 2020 at -2.19 percent, year on year) and the hard work that supported the Indonesian economy in Quarter II-2021 against quarter II-2020 experienced a growth of 7.07 percent, this is Indonesia's new hope in the future. 

Ecosystem services are the key to Indonesia's success in avoiding the more severe economic downturn during the COVID-19 pandemic and the stability of the country's foreign exchange. The largest ecosystem service that this country receives is from oil palm plantations, we must be grateful because oil palm thrives in Indonesia, this is God's gift to Indonesia and the world.

A similar sentiment was conveyed by President Jokowi at the opening ceremony of the inauguration of the millennial farmer ambassadors of the Ministry of Agriculture, on Friday. The President said that 71 percent of Indonesian Farmers are above the age of 45 years and 29 percent are under 45 years of age. In his speech, the President also mentioned the resilience of the agricultural sector during the Covid-19 pandemic, that in 2020, when other sectors fell and contracted, agriculture was still able to have a surplus of 1.75 percent. 

Research results from the Palm Oil Agribusiness Strategic Policy Institute, PASPI (2021), revealed that urban districts that have oil palm plantations tend to have better economic growth, compared to urban districts that do not have oil palm plantations, and this growth is more contrasting during the Covid-19 outbreak. 19 hit the world. 

The results of this study are empirical and the results are the same as those of the World Bank. Similarly, the results of research conducted by the Indonesian Palm Oil Farmers Association (APKASINDO) in three Palm Oil Provinces, namely Riau, West Kalimantan and West Sulawesi, the average net income of oil palm farmers/ha/month is Rp.1,485,000 (calculated in July 2021), where the average farmer ownership of the survey results is 4.18 ha, which means that per month the farmer gets a net income of Rp. 6,207,300 with the level of sustainability economic, ecological and social aspects are included in the very sustainable category. 

The state benefits greatly because 42 percent of oil palm plantations in Indonesia (almost 7 million ha) are managed by independent farmers, so the multiplier effect is very large, it would be a different story if 85 percent of oil palm plantations were only managed by corporations. That is why on various occasions I always emphasize to corporations that "minimizing the profit sharing of oil palm farmers is the same as killing Indonesian palm oil,” oil palm farmers and corporations need each other and must support each other.  

Other data revealed is that 1 ha of community oil palm plantations is equivalent to 1,000 ha of corporate oil palm plantations, the benefits for the social and economic aspects of the communities around the oil palm plantations, and the social dimension aspect exceeds the four dimension indicators assessed, therefore it is not surprising that from the research results in collaboration with the Institute for Research & Community Service (LPPM) and the Doctoral Program in Environmental Sciences, University of Riau with APKASINDO (2021), that community oil palm plantations have a higher sustainability value than oil palm plantations owned by corporations. (Author: Gulat Medali Emas Manurung/ General Chairperson of APKASINDO DPP)