InfoSAWIT, PALEMBANG – The South Sumatra Provincial Plantation Agency (Disbun Sumsel) has called on all stakeholders in the palm oil industry to safeguard Fresh Fruit Bunch (FFB/TBS) price stability and maintain regional economic stability following adjustments to Indonesia’s natural resource export governance policy.
The appeal was outlined in an official circular dated May 25, 2026, numbered 500.8/902-VI.3/BUN. According to the agency, recent national policy developments have triggered market reactions, including declining FFB purchase prices at the Smallholders level, despite relatively stable global crude palm oil (CPO) prices.
Acting Head of the South Sumatra Plantation Agency, M. Ichwansyah, warned that the widening imbalance between international CPO prices and local FFB prices could create economic uncertainty and threaten regional stability if not addressed promptly.
“Price imbalances have the potential to create economic uncertainty and disrupt regional stability,” Ichwansyah stated in the circular reviewed by InfoSAWIT on Wednesday (27/5/2026).
Monitoring and Enforcement Intensified
To prevent further market disruption, the provincial government instructed plantation offices across regencies and municipalities to strengthen monitoring and supervision of FFB purchasing practices at plantation level.
Local authorities were also directed to ensure that all FFB transactions comply with official pricing periodically determined by South Sumatra’s provincial pricing team and to take action against violations or price manipulation occurring outside existing regulations.
Disbun Sumsel further urged plantation companies and Palm Oil Mills (PKS) not to reduce FFB purchase prices unilaterally under the pretext of adapting to new export regulations.
The agency emphasized that mills must continue adhering to government-established pricing mechanisms, including provisions under Minister of Agriculture Regulation No. 13/2024 and gubernatorial decrees governing FFB pricing formulas for partnered Smallholders.
GAPKI and Smallholders Associations Asked to Play Active Role
The South Sumatra chapter of the Indonesian Palm Oil Association (GAPKI) was also encouraged to coordinate plantation companies and mills to ensure FFB prices remain fair and consistent with prevailing regulations.
Meanwhile, all PKS operating in South Sumatra are required to report FFB purchase price data regularly—effective from May 19, 2026—to the Directorate General of Estates, while simultaneously submitting copies to the provincial plantation agency.
On the Smallholders side, organizations such as ASPEKPIR and APKASINDO were asked to help educate palm oil growers to remain calm, avoid speculative or disruptive actions, and formally report suspected pricing violations by mills.
Disbun Sumsel stressed that strong cooperation and regulatory compliance among all stakeholders would be essential to sustaining the province’s palm oil sector during the policy transition.
“Synergy and compliance among all stakeholders are critical to maintaining the sustainability of South Sumatra’s palm oil industry during this transition period,” Ichwansyah emphasized. (T2)
