InfoSAWIT, JAKARTA – The Roundtable on Sustainable Palm Oil (RSPO) and the Indonesian Palm Oil Smallholders Association (APKASINDO) have signed a historic Memorandum of Understanding (MoU) to accelerate inclusive growth, certification, and market access for smallholder palm oil farmers in Indonesia.
With a contribution of nearly 40% of the total national palm oil production, smallholders play a crucial role in maintaining the industry's sustainability. This collaborative step is seen as a new milestone that will strengthen Indonesia's position as a global leader in sustainable palm oil production.
Indonesia currently accounts for approximately 55% of the world's palm oil supply. However, the productivity of smallholders still lags far behind that of large plantations. The average yield for smallholder farmers is only 2–3 tons per hectare, whereas large plantations can reach 6–8 tons per hectare. This gap, combined with limited access to financing and certification systems, poses serious risks to both the welfare of farmers and national competitiveness.
Through this MoU, RSPO and APKASINDO affirm their commitment to promoting inclusive growth that focuses not only on increasing productivity but also on ensuring fair participation, empowerment, and rural economic resilience.
"This MoU is not just about certification; it's about justice, resilience, and inclusive growth. Every lost ton of yield due to low productivity means a reduction in Indonesia's competitiveness. Closing the yield gap without expanding land is key to maintaining our competitive edge," explained Guntur Cahyo Prabowo, Head of Smallholders at RSPO, in an official statement received by InfoSAWIT on Wednesday (9/10/2025).
According to him, without inclusive measures, Indonesia risks losing billions of dollars annually due to low productivity, the loss of premium market opportunities, and the potential of being excluded from increasingly regulated global markets, including the European Union Deforestation Regulation (EUDR).
Echoing this sentiment, Gulat ME Manurung, Chairman of the APKASINDO Central Executive Board, stressed that the MoU is a historic milestone for smallholder palm oil farmers. "For too long, farmers have been viewed as mere marginal suppliers, even though we contribute almost 40% of national production. With this strategic collaboration with RSPO, we are recognized as equal partners in the global supply chain," he said.
For APKASINDO, Gulat added, this partnership is not just about certification but also about the future of millions of farming families. "It concerns access to financing, fair markets, increased productivity without opening new land, and strengthening the economic resilience of villages. This way, Indonesia can maintain its leadership in sustainable palm oil," he added.
The collaboration between RSPO and APKASINDO is also an open invitation for the government, financial institutions, and industry players to build an ecosystem that supports smallholders. With their recognition as equal partners, Indonesia is not only ensuring sustainability but also solidifying its position as a global leader in a just, inclusive, and resilient palm oil industry. (T2)
