The Secretary-General of the Indonesian Association of Coconut Processing Industry (HIPKI) Donatus Gede Sabon is warning of the dangers and vulnerability of an economy that is heavily relying on a single commodity, in this case, palm oil.
While the Indonesian government says the country’s oil palm plantations cover some 14 million hectares, a study conducted by palm oil industry watchdog Sawit Watch puts the figure much higher, at more than million hectares.
The Indonesian government is also currently encouraging its own palm oil sustainability scheme, the Indonesia Sustainable Palm Oil (ISPO) to assure the sustainability of the palm oil industry. However, most smallholders still face many obstacles, administrative and or financial, in obtaining certification.
The definition of what a forest entails can substantially impact the estimate of deforestation and forest destruction as well as in estimating the real culprit behind deforestation.
“farmers should be able to pocket RP 1,300-Rp 1,500 per kilogram of fresh fruit bunch but what is happening on the field is that prices could reach Rp 600 per kilogram,” APKASINDO Deputy Secretary-General Rino Afrino told The Palm Scribe.
Indonesian Palm Oil Farmer Union (SPKS) Chairman Mansuetus Darto on Tuesday (24/7) called on the government to set a bottom price for the purchase of oil palm fresh fruit bunch (FFB) by mills at Rp1,500 per kilogram to assure the survival of oil palm farmers and their family.
GAPKI said that amid the uncertainty in the market, and the heightening trade war tension between China and the United States, the government should accord special attention to the palm oil industry so that palm oil prices do no continue to deteriorate.
The Indonesian Palm Oil Board (DMSI), Solvent Extractors Association (SEA) India, and Solidaridad Network Asia Limited (SNAL) have signed a Memorandum of Agreement that reaffirmed cooperation between them on a sustainable development of the vegetable oil sector, including palm oil and is derivatives.
The Roundtable on Sustainable Palm Oil (RSPO) announced on Monday, (16/7) it was reinstating Nestlé membership following the submission of its time-bound action plan to achieve 100 percent RSPO certified sustainable palm oil by 2023.
“Building up an agreement with farmers is the most difficult part because usually, they will first ask about the benefits. One of the benefits that they usually ask is whether the prices of their fresh fruit bunches would change if they get certified,” said Setara Jambi Foundation Director Rukaiyah Rafiq.