InfoSAWIT, JAKARTA - The soaring price of crude palm oil (CPO) is currently not being felt by independent palm oil farmers. Therefore, synchronizing the price of Fresh Fruit Bunches (TBS) palm oil with CPO is necessary to enhance community welfare.
Amid the positive trend of CPO prices reaching IDR 15,000 per kilogram, palm oil farmers in Indonesia still face significant challenges regarding the mismatch between TBS prices at the farmer level and CPO prices downstream.
According to Boyke Setiawan Soeratin, Chairman of the Committee II for Foreign Relations and Inter-Institutional Affairs of the Indonesian Planters Society (IPS), this situation indicates the need for price synchronization so that the benefits of rising CPO prices can be directly felt by farmers.
Boyke explained that the significant increase in CPO prices is a breath of fresh air for the palm oil industry. However, the price discrepancy of TBS in the field creates new problems, where farmers cannot fully enjoy the benefits of this price increase. "The rise in CPO prices is indeed extraordinary. However, farmers in the field only enjoy a small portion of this profit because the TBS prices they receive do not correspond to CPO prices," he stated at the FGD SUSTAINABLE PALM OIL VOL 16 event, themed “Sustainable Palm Oil Plantations Growing Rural Community Economy,” organized by InfoSAWIT with support from BPDPKS, in early November 2024, in Jakarta.
Highlighting the importance of this synchronization, Boyke recalled that windfall profits were once experienced by palm oil farmers in 2012. “At that time, transmigrant farmers in Mamuju could even return home by plane due to the substantial profits they earned,” he said. This significant profit once encouraged the establishment of financial institutions such as the People's Development Bank (BPR) managed by farmers' cooperatives.
However, conditions in the field have changed. In addition to price discrepancies, another challenge is the difficulty in obtaining valid data. Boyke revealed that differing data from various sources often poses serious problems for industry players. “Production data, plantation area, and prices often differ between BPS, BPDPKS, and the Ministry of Agriculture. This complicates our decision-making,” Boyke explained, hoping for a centralized data information system that can provide comprehensive and accurate data. (T2)
