The Palm Scribe

Farmer Union Wants Government to Set Bottom Palm Oil Purchase Prices

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.


Darto and Luhut met at Coordinating Ministry for Maritime Affairs

“We are asking Rp1,500 because that is the threshold. When there is a crisis and prices crashed, it is the task of the government to subsidize (the price) so that it can, at the very least, be at that threshold level,” Darto told the Palm Scribe after having met with Coordinating Minister for Maritime Affairs Luhut Binsar Panjaitan,

Darto said that Rp1,500 was a price level which would allow farmers to cover production costs and be able to buy some daily needs for them and their family.

Oil Palm FFBs are now fetching between Rp800 and Rp1,000 per kilogram and the government needs to help stabilize prices, including through subsidies.

“The global market conditions cause this situation, it is now bearish and dropping and we are still dependent on the market overseas,” he said, citing the ongoing trade tension pitting the United States and China as one of the reasons behind the pressure on world palm oil prices,

SPKS, according to Darto, also urges the government to solve the problem of oil palm smallholders with plantations in forest areas.

“Those smallholders managing around four hectares in forest areas should be released from the obligation of vacating their plots,” Darto said, in an SPKS presentation he sent to The Palm Scribe earlier on Tuesday (24/7). He said that the matter was a priority that needed to be urgently addressed.

 Regarding the Palm Oil Fund Management Agency (BPDPKS) Darto said in the presentation that the fund should be accessible to farmers to improve human resources, build their plantation and obtain sustainability certification.

“This fund should be easily accessible to farmers, without having to go through complicated procedures,” Darto said in the presentation.

Darto also called on the government to come out with a roadmap that would allow smallholders to become more self-dependent. The government should promote models of sustainable development implemented by Indonesian oil palm farmers more extensively.

The country’s palm oil diplomacy on the international scene should also involve domestic parties and should be more open. “A wrong diplomacy will have a fatal impact on farmers,” he said.

Darto had previously said that the black campaign against palm oil in the global market was threatening the future of Indonesian farmers because it could push prices down and therefore he called on the government to rapidly settled the problems faced by palm oil in the international world.

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