PALMOILMAGAZINE, JAKARTA – The onset of the Covid-19 pandemic in early 2020 had a profound impact on the palm oil industry, particularly in crude palm oil (CPO) production. Data indicates a significant 6.83% reduction in CPO production in 2020, amounting to 8.86 million tons compared to the previous year. However, there was a recovery in 2021, with production increasing to 8.96 million tons.
The trend reversed in 2022, experiencing a 2.49% decline to 8.74 million tons. This decline was attributed to decreased palm oil yield in Riau Province, influenced by adverse weather conditions and the El Niño phenomenon in Indonesia.
In 2020, Riau maintained its position as the largest CPO contributor, accounting for 8.74 million tons, approximately 18.67% of the total production in Indonesia. Central Kalimantan Province followed closely, producing 8.36 million tons, constituting 17.86% of the total production.
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“Based on the cultivation status, in 2021, Riau Province produced 53,76 percent CPO or 4,82 million tons from the smallholders; 41,85 percent or 3,75 million tons from big private companies; and the rests, 4,39 percent or 0,39 million tons from the government’s plantations,” the note mentioned as Palmoilmagazine.com quoted from Buku Statisik Kelapa Sawit Provinsi Riau 2022, that Riau Central Bureau of Statistic (CBS) published.
Though the total production decreased in 2022, production structures based on the cultivation were not significantly changing. The smallholders’ plantations still dominated with the estimation 4,82 million tons CPO (55,13 percent), then big private companies with the total production 3,53 million tons (40,33 percent), and the rests, 0,39 million tons (4,50 percent) were from the government’s plantations.
For many factors influencing CPO production, palm oil industries keep facing challenges to maintain the stable supply and respond the market dynamic in the globe. The key would always be the supervision in the sector to maintain sustainability and adaptation to unexpected external changes. (T2)
