PALMOILMAGAZINE, JAKARTA – The rising popularity of sustainable palm oil in global vegetable oil markets is attributed to its superior cultivation practices and increased productivity. These advancements have significantly contributed to the sustainability of palm oil production, leading to continuous growth over time.
The substantial increase in sustainable palm oil production has become an integral part of Indonesia’s successful palm oil industry. Through the implementation of best agricultural practices, the country has witnessed a remarkable expansion in sustainable palm oil production, making significant strides on the global stage.
Data from the Roundtable on Sustainable Palm Oil (RSPO) in 2023 indicated that certified sustainable palm oil (CSPO) production from Indonesia reached 8.64 million tons, marking a 2.9% increase compared to the previous year.
Despite the growth in CSPO production, palm oil plantations in Indonesia continue to face various challenges. Legal constraints pose significant obstacles to the development of future plantations, highlighting the need for continued efforts to overcome these barriers.
It is normal if CSPO from Indonesia derived from 2,5 million hectares palm oil plantations. The numbers are relatively smaller than palm oil plantations in this country that laid on 16,5 million hectares. But the spirit to improve the sustainable and best cultivation practices, is the good consideration because it would involve thousand smallholders in many palm oil plantation centers.
The big power of CSPO production would reinforce Indonesia as the biggest sustainable palm oil producer. The question remains, what about smallholders’ bargaining offer position in sustainable production? Through their biggest contribution, thousand smallholders could directly involve in sustainable palm oil supply chain within CSPO materials.
The next role derived from industrial supply chain. CSPO could be processed to be sustainable products. In intermediate companies (industries), palm cooking oil industries also play big roles to process CSPO to be food oil products, such as, by multiplying specialty fats that would produce margarine and other food substitutions.
Downstream Sectors: Food Security.
The pioneer of the strongest palm oil food security derived from palm cooking oil industries that develop fast in Indonesia. Big cities in this country mostly have palm cooking oil industries. In 2000s, palm cooking oil industries developed in Sumatera and Java only but they developed to Kalimantan and Sulawesi.
The industries which were constructed in 4 big islands in Indonesia, encouraged to develop food security in palm oil- base. If (the government) being serious to develop food downstream sectors, palm cooking oil industries would be the big modal to develop specialty fats industries and others in this country.
Food security by having downstream sectors that derived from palm oil, could be encouraged more by developing special industrial zone particularly palm oil – cluster, just like in Sumatera within Kawasan Industri Sei Mangkey and Kawasan Industri Dumai. The main goal of developing the zones, is about to optimize additional values of palm oil derivative products.
Downstream Sector: Energy Security.
Developing downstream sector to get food security, as a matter of fact, could not stand alone but should be developed until non-food products, for instance, oleochemical and biodiesel.
Downstream sector in food energy should be update with food oil industrial development. That is why palm cooking oil industries could not be categorized as downstream industries but intermediate ones for they would encourage other food and energy sectors in Indonesia.
It needs to simultaneously develop food and energy sectors for they would easily be seen in palm oil industrial zones which are developing. But for the secrecy of (a) company, lots of information should not be available for the people because it is said, the secrecy would be the ‘successful key’ to develop palm oil downstream sectors (industries) in Indonesia.
Downstream sectors in palm oil material in this country would play the big roles in food and energy security in Indonesia. The existence of palm oil industries, they have big influences to make Indonesia more developed. Covid-19 pandemic saved export performance in crude palm oil (CPO) and its derivatives.
If CSPO production could involve thousand smallholders in Indonesia, why do not palm oil downstream sectors do the same thing? Many systems that encourage people’s welfare actually could run in many better ways in the future. It is time palm oil downstream sectors for food and energy security run by involving million smallholders in Indonesia. Merry Christmas 2023 and Happy New Year 2024. (*)
By: Ignatius Ery Kurniawan/Editorial in Chief of Palm OIl Magazine
