The Palm Scribe

Sustainability of Indonesian Palm Oil Sector is the Business of All Stakeholders

The Indonesian palm oil industry, which has been the target of continuous attacks related to the environment and the respect of human rights, cannot go the sustainable way and this requires the collaboration between all stakeholders, an official of the Environment and Forestry Ministry (KLHK) said.

The head of the ministry’s Center for Environment and Forestry (Pustanlinghut KLHK) Noer Adi Wardjoyo, stressed during a public discussion taking the theme of Sustainable Palm Oil Update here on Thursday (7/6), that there are Sustainable Development Goals (SDGs) that Indonesia needs to meet, including in the palm oil sector.


Wardoyo said that the solution to sustainability in the palm oil sector is that all players in the industry, including consumers, needed to promote awareness of SDG-based consumption and production patterns. ‘There must be a collaboration, and not bickering between stakeholders in trying to find a solution,” he said.

Putra Agung, Program Manager Sustainable Palm Oil with World Wild Life (WWF) Indonesia that organized the discussion, said that regardless of whether there is an external pressure or not on Indonesia’s palm oil, it was now time for all stakeholders in the industry to step up sustainability in production and in demand.

“Perpetrators of Unsustainable palm oil cause human exploitation, fauna scarcity, clean water problem, climate change and deforestation,” Agung said.

He said that from the supply side, sustainability must cover the entire supply chain, not only the production. “There are two sectors which up until now have not been well supervised in relations to the palm oil industry, that is the retail and manufacturer, which supply chain still tend not to apply sustainable policy,” Agung said.

He said that although being the target of the continuous attack, the role of palm oil is difficult to replace, both for the government of Indonesia and the private sector as the producers, as well as for the consumers.

“Why is palm oil so well known? Because it is proven to have a higher efficiency level than other crops and there are no other oil crops that can compete with oil palm,” Agung said.

He also added that another advantage possessed by palm oil is that I can produce a wide range of derivative products.

“There are many derivative products that can be produced, at a cheaper production cost and on top of that the markets are also much wider compared to other commodities,” he said.

Wardjoyo reminded that the role of sustainability certifications for palm oil such as the Roundtable Sustainable Palm Oil (RSPO) and the Indonesia Sustainable Palm Oil (ISPO) are important to know which industry players abide by sustainable production practices.

But producers said that certifications were not so effective in boosting sales. Rhonald Katili, Head Sales, and Marketing PT. Sinar Meadow said that producers faced both internal and external challenges in using sustainability certification such as RSPO.

“Internally, our production cost becomes higher and of course the selling price also increases,” Katili said, adding that the higher cost came from the sustainability requirements set down by RSPO.

“Externally, consumer awareness about the sustainable product in Indonesia is not yet high, and even in the case a company violates the requirements of the certification, the sanction is merely a suspension while the demand is still strong,” he said.

Intan Wibisono, Edelman’s Associate said that raising awareness on sustainable consumption and production of palm oil required complete information and all sides to each play their respective role.

“The media can assist in spreading complete information, the NGOs can play their role as watchdogs, and the government and businessmen can implement sustainable regulations,” Wibisono said.

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