InfoSAWIT, JAKARTA – Coordinator Minister in Economy, Airlangga Hartarto, told the significance of palm oil as the main export commodity from Indonesia that reached up to US$ 29,66 billion in 2022.
In the Indonesia’s Smallholders Gathering, he told that the high exports were the results of smallholders’ vital roles in Indonesia. The government as its response, launched infrastructure programs with the budget more than Rp 127 billion and involved more than 7 thousand men in 2023.
Though palm oil as the mainstay export from Indonesia, Airlangga acknowledged that smallholders’ plantation productivity needs to be increased. One thing to do is by implementing smallholders replanting program (SRP). He also mentioned that the smallholders’ average plantation productivity reached about 2,6 – 3 tons of CPO per hectare per year. By implementing SRP, more than 134 thousand smallholders got total fund about Rp 8,5 trillion to escalate their plantations productivity that laid on about more than 300 hectares.
Besides, he also told the threats in palm oil industries in Indonesia. European Union planned to implement European Union Deforestation Regulation (EUDR) that would start by the late of 2024. Some in EUDR, such as, palm oil plot geolocation and country benchmarking system, would potentially deliver losses for smallholders. Besides European Union would deliver massive subsidy up to US$ 436 billion that would negatively deliver impacts for Indonesia’s palm oil exports.
In this context, Airlangga mentioned that European Union competes with palm oil from Indonesia and tries to reduce the impacts by proposing to vanish palm oil from vegetable oil supply chain. European Union regulated close terms and condition about smallholders’ geolocation data and this becomes challenge for Indonesia as the biggest producer.
“European Union delivered subsidy about US$ 436 billion through intervene helps to protect the markets and other programs. There would be challenges to the future palm oil exports in Europe,” he said when inaugurating Indonesia’s smallholders gathering that Apkasindo conducted on Thursday (7/12/2023) that InfoSAWIT attended.
Meanwhiole Chairman of Apkasindo, Gulat Manurung said that the smallholders faced challenges in SRP. Their palm oil plantations are categorized as forestry regions by Ministry of Environment and Forestry. He also said that based on Undang-Undang Cipta Kerja, palm oil plantations that grew before 2020 can be acknowledged as plantation areas.
To solve this issue, Apkasindo suggested the smallholders that cultivate less than five hectares or master their plantations more than five years, should join SRP. He also hoped that the decision about it, would be executed in 2024 so that the targets of Palm Oil Plantation Fund Management Agency (PFMA) would be the same with what President Joko Widodo instructed that reached 180 thousand hectares per year. (T2)
