PALMOILMAGAZINE, SURABAYA – The palm oil industry in Indonesia continues to thrive, serving as a significant player with a total production of 52 million tons of crude palm oil (CPO) and employing 16.2 million workers. Among these figures, 40 percent of the production is allocated to domestic markets to meet food demands, while the remaining 60 percent is exported to various countries across the world.
From a national economic perspective, palm oil exports contribute substantially, accounting for approximately 10.20 percent or 29.66 billion dollars. This underscores the pivotal role of the palm oil sector in driving economic progress in Indonesia.
However, the path to success is not without its challenges. One of the primary hurdles is the imperative of ensuring sustainability within Indonesia’s palm oil industry, which currently commands a 35 percent share of the global palm oil trade. The industry aspires to expand its global footprint, but it must address critical issues, particularly those related to compliance with the European Union Deforestation Regulation (EUDR).
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Deputy Coordinator Minister of Economy in Food and Agribusiness Coordination, Coordinator Ministry of Economy, Musdhalifah Machmud said that the Government of Indonesia has done some strategies to face the challenges, such as, by having the same mission with Malaysia to Brussel.
The government also established joint task force in the first meeting that got workprint, such as, the first, every smallholder should be concluded into palm oil supply chain; the second, confirm that Indonesian Sustainable Palm Oil (ISPO) and Malaysian Sustainable Palm Oil (MSPO) would be accepted by European Union (EU).
“We have to discuss and get guarantee in the markets that every sustainable scheme that has been implementing would be accepted by EU,” she said when speaking in the Pekan Riset Sawit Indonesia 2023 (PERISAI 2023) with the theme “Reinforcing Palm Oil Industry in Combating Global Challenges through Technological Innovation” in The Westin Surabaya that Palmoilmagazine.com attended, Wednesday (25/10/2023).
The third, Musdhalifah continued, the implementation of traceability. It needs to get some discussion because about 40% of palm oil plantations in Indonesia are cultivated by smallholders. The fourth, about natural resource advantages which should be environmental. “We would inform EU Parliament that our (palm oil) products would be traded in Europe. Everything must be well discussed,” she said.
EUDR joint task force would have the second meeting on 12 December 2023.
Musdhalifah thought, the government did proactive things to solve the challenges of sustainability, revision in ISPO, close monitoring in supply chain from the upstream to downstream sectors, the hard thing to sell biodiesel and biomass in sustainable palm oil – bases.
Research processes have been reinforced. Data and findings from every research would be the basic to guide industries and the people to understand more about sustainability. By having cooperation among the governments, stakeholders, and the people themselves, the researches would develop accurate and deeper guidelines to develop palm oil industries in the principles of sustainability.
“Every research should be really taken for advantages by the people and industries to get ours sustainable and also realize sustainable palm oil industries,” Musdhalifah said. (T2)
