InfoSAWIT, JAKARTA – The government’s planned overhaul of natural resource (SDA) export governance should be assessed carefully to ensure that efforts to strengthen oversight and curb foreign exchange leakages do not ultimately weaken the position of palm oil smallholders and cooperatives within Indonesia’s palm oil industry.
This view was expressed by members of the Indonesian Sustainable Palm Oil Farmers Forum (FORTASBI), who believe that while strategic export policies could deliver positive outcomes, they also carry risks if implementation becomes overly centralized and lacks participation from stakeholders on the ground.
Chairman of Koperasi Perkebunan Belayan Sejahtera (KPBS), Jamaluddin, said government efforts to combat under-invoicing and strengthen export oversight deserve support, but implementation must remain transparent and safeguard business opportunities for farmers and cooperatives.
“We support the government’s objective of preventing export leakages and strengthening national trade governance. However, the system being developed must remain transparent, avoid creating new monopolies, and preserve participation opportunities for farmers and cooperatives,” Jamaluddin told InfoSAWIT on Sunday (May 24, 2026).
FORTASBI believes a more controlled export scheme could provide benefits such as stronger contract and transaction oversight, improved management of export earnings, and enhanced bargaining power for Indonesia in dealing with global buyers.
At the same time, the farmers’ organization warned that several challenges must be anticipated from the outset.
According to Jamaluddin, centralizing trade governance through a single export gateway could create bureaucratic bottlenecks that slow trade flows and increase transaction costs if not supported by efficient service systems.
“The biggest risk of an overly centralized system is the emergence of bureaucratic obstacles, export delays, and additional costs that could eventually be passed on to mills, cooperatives, and even farmers through lower fresh fruit bunch (FFB) prices,” he said.
Jamaluddin further noted that the impact of export policies extends beyond international trade and directly affects the domestic supply chain, including exporters, mills, cooperatives, and oil palm smallholders.
If not managed carefully, fresh fruit bunch prices could come under pressure due to tighter sales requirements and changes in transaction mechanisms.
Smallholders, he added, are among the most vulnerable groups if they lack plantation data, adequate legal documentation, and strong economic institutions.
FORTASBI therefore urged the government to ensure that any new policy includes consultation with farmers and cooperatives and provides clear pricing formulas and transaction mechanisms.
Head of the FORTASBI Secretariat, Rukaiyah Rafik, stressed that oil palm smallholders must also prepare for changes in trade governance by strengthening farmer organizations and improving sustainable cultivation practices.
“Farmers must not become mere objects of policy. They need to strengthen their bargaining position through cooperatives, improve plantation data and legal status, and adopt good agricultural practices to remain competitive,” she emphasized.
FORTASBI also views stronger cooperatives as a key factor in maintaining balance within Indonesia’s palm oil supply chain. Cooperatives, the organization said, must improve traceability, transaction recording, and governance capacity to adapt to increasingly complex trade regulations.
Beyond production improvements, the farmers’ organization encouraged smallholders to develop alternative income sources outside palm oil to strengthen household economic resilience in key producing regions.
For FORTASBI, stronger export governance should not focus solely on trade supervision and state revenue collection but also serve as momentum to reinforce the role of oil palm smallholders as a vital part of the national industrial ecosystem.
“Farmers and cooperatives must be involved from the beginning so that policies are not only strong on paper but also fair and effective in practice,” Rukaiyah concluded. (T2)
