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Palm Oil Industrialization Should be in Smallholder Partnership



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Palm Oil Industrialization Should be in Smallholder Partnership

InfoSAWIT, JAKARTA – The facts showed that palm oil processing activity is beyond hope, for instance, in West Kalimantan Province where palm oil plantations lay about 1,8 million hectares, there are only mills having 2.152 fresh fruit bunch (FFB)/hour capacity. It means, from the wide, mills capacity should be actually 7.200 tons FFB/hour.

The other example is in Riau. The plantations that lay about 3,4 million hectares, the mills just reach 12.170 tons FFB/hour. General Secretary of Serikat Petani Kelapa Sawit (SPKS), Darto said, the capacity numbers just process FFB from about 3 million hectares. “There is no balance or effectiveness. And this influences crude palm oil (CPO) production,” he said

Until now, he continued, palm oil plantation licenses that have been published covered 21 million hectares. The planted ones lay about 16,3 million hectares or about 5,5 million hectares are not planted still.

Meanwhile, the government always boosts smallholders replanting program (SRP) to increase smallholders’ plantation productivity. It will increase theirs up to twice. The policy regulating 20% allocation for plasma smallholders is not happening too in a whole, only 40% of the total areas in Indonesia.

Indonesian Palm Oil Association claimed, the 2020 palm oil trade overstock hardly reached 5 million tons. Palm oil demands are still from Roundtable on Sustainable Palm Oil (RSPO) scheme. “The issues will raise new problems in days to come. In addition, palm oil moratorium policy is not clear and clean yet if it is prolonged or not,” Darto said.

That is why palm oil industrialization in national scale should be based on smallholders as the subjects through their institutions to get added values, capability of competition to make Indonesia go forward. Meanwhile government‘s enterprises should be the pillars to help and conduct partnership with smallholders’ institutions or cooperation. They should become the ‘left wings’ of Enterprises. “Enterprises should do upstream and downstream sectors by having partnership with smallholders,” he said. (T2)

Source: InfoSAWIT, September 2021