FGD Sawit Berkelanjutan Vol. 7: Jack Up The Smallholders’ Productivity

FGD Sawit Berkelanjutan Vol. 7: Jack Up The Smallholders’ Productivity

PalmOilMagazine, JAKARTA – The big numbers of Export Tax as same as the better crude palm oil (CPO) price makes Palm Oil Plantation Fund Management Agency (PFMA) as part of palm oil industries nationally. The roles of PFMA could help the smallholders by giving replanting subsidy and infrastructure development to the better future.

The smallholders who may have minimum infrastructure could get fund subsidy help from the fund managed by PFMA. The fund to develop infrastructures is regulated in Decision of General Director of Plantation Ministry of Agriculture No. 144/Kpts/OT.050/4/2020 about Infrastructure Fund for the Smallholders Would Use Fund Subsidy from PFMA.

The subsidy covers the helps of fertilizers, pesticides, production nursery or identification in help package per hectare. Besides infrastructure subsidy would be given by post-harvest tool package, such as, egrek, angkong, and others that the smallholders mostly use to harvest their plantations.

The fund supports from PFMA regulated by Decision of General Director of Plantation is technically regulated by Decision of Director of PFMA in the execution. It officially runs since May 2020 and should distribute the subsidy to the smallholders through the third side or consultant survey result which does survey, investigation, and design on the help that would be given in the package/unit.

The fund to give would be focused in 18 provinces with main targets – palm oil superior seeds, fertilizers, and pesticides to smallholders’ areas covering 2.000 hectares. The intensification target would also get fund helps from PFMA within condition, the areas covering 8.000 hectares. The fund help would be given to get Indonesian Sustainable Palm Oil (ISPO) certificate in 10 packages and infrastructure ways covering 6.000 hectares.

The main condition of help package would be through the smallholders’ institutions, such as, organization, groups, and legal area aspects in the form, at least, surat keterangan tanah from the head of local village.

The infrastructure helps would be the complement of replanting subsidy for smallholders’ plantation which PFMA initiated before. The target in 2021 is about to cover 180 thousand hectares of the smallholders’ plantation and the fund would be about Rp 5,56 billion.

As part of the government, PFMA has the strategic roles to encourage the change and progress of palm oil industries from the upstream to downstream sectors to be better in the future. But the issue is that not every people know this information.

That is why, the big numbers of export tax fund in PFMA should be clearly explained to the public namely the smallholders about the numbers and the use both for green diesel and the smallholders’ plantations including to increase their capacity.

As a matter of fact, it is simple to get the fund help. It is believed, this would not be an issue for the smallholders in the context of extensification, intensification, path in the plantations, and ISPO certification. The government would guarantee that plantation agency would facilitate some conditions, for instance, to publish Cultivation Documents. It means that when proposing (to get fund/subsidy), this is not absolute condition but the most important thing, the smallholders have the will to accomplish (get) it.

Director of Fund Distribution PFMA, Edi Wibowo said that to support the independent smallholders, one solution offered by the government is the massive replanting program. The goal is about to help them, improve their plantations to be more sustainable, qualified, and minimize the risks of illegal land use, land use change of forestry (LULUCF)

But to get the fund help, their areas should be clean and clear status namely about the legal. “The independent smallholders who join this program should follow the legal aspect of their plantation. For those who do not follow it, they would not get it,” he said in FGD Sawit Berkelanjutan Vol 7, bertajuk “MENINGKATKAN PERANAN PETANI SAWIT RAKYAT MELALUI SUBSIDI REPLANTING DAN SUBSIDI SARANA PRASARANA,” Wednesday (28/4/2021), that PalmOilMagazine held.

The goal of replanting program is about to increase the productivity. The standard productivity after having replanting program would be about 10 tons of fresh fruit bunch (FFB) per hectare per year with density about 80 trees per hectare.

He also mentioned that to assure the sustainability principles, the participants of the program should get ISPO certificate in their first harvest. “The replanting program should follow the sustainable principles which cover the soil, conservation, environment, and the institution,” Edi said.

Palm oil plantation infrastructure development is about to increase the production, productivity, and quality which cover the helps of seeds, fertilizers, pesticides, post-harvest tools, path in the plantations, access to the main road, and or to the port, transportation, agricultural tools, the making of market infrastructure, and technical verification/traceability.

General Secretary of Serikat Petani Kelapa Sawit (SPKS), Mansuetus Darto said that replanting program is the way to make the farmers better in economy through their increasing productivity, and to strengthen sustainability aspect by maximizing the existing plantations and increasing yield, but preventing the deforestation or new planting.

Until now, he continued, to get fund helps from PFMA, the conditions have been simplified from 16 to 2 only. But, something to analyze is that the replanting targets from 2017 to 2022 which cover 725 thousand hectares, how to know it? In addition, in every year, there was new target as if (those who targeted replanting program) knew the regions that replanting program was done.

“Unfortunately, the realization and target in every year is almost a FAIL, including the surveyor involvement. There is no realization of the target. The fund to replanting program by 2020 just reached Rp 5,5 billion. It was much cheaper than fund subsidy for biodiesel program which reached Rp 57,27 billion,” he said.

He also mentioned that many smallholders do not know about replanting program. As the impact, they independently do the replanting program without the program. The independent smallholders are in many places and they have no institutions.

“There is no available development because human resources and minimum fund in the district/agency. There is no real data, for instance, who, where, kinds of area, year of planting – that the government has. There is no data about village development to do the replanting program for the village developers are not paid, including the small areas about 2 hectares. If those having 2 hectare – areas, do the replanting program, they might lose the income,” he said.

In replanting program, he proposed that there would be additional fund from Rp 30 million per hectare to be Rp 50 billion per hectare to avoid the loans from the banks. It needs to provide fund to replanting program pre-condition for the independent smallholders.

Actually, the smallholders’ groups are the essential point to run replanting program. But the fund from PFMA does not support to make the groups. Darto mentioned, is it possible that fund in PFMA would be in decentralization so that the fund would be managed by the district or province, but not Jakarta?

For the companies, replanting program could become one way to increase the plantation productivity, jack up the production without new planting. That is why the companies are committed to accelerate the replanting program as the main focus in the work program in 2021.

To support the replanting program, Indonesian Palm Oil Association (IPOA) did meet Coordinator Ministry in Economy September 2020 to help the replanting program acceleration.

IPOA also did cooperation with smallholders’ association to facilitate the groups, unions to be in partnership with the members of IPOA, coordinate with surveyors Indonesia to be in partnership with the groups/union in each branch/province.

“We do put data and progress in SRP from our members in each branch, did make SRP taskforce,” General Secretary of IPOA, Eddy Martono

Eddy also mentioned that the partnership with the smallholders would be in, the first, tissue development; the second, replanting contract; the third, avalist full commercial; and the fourth, cultivation operator. But SRP would have issues, such as, the way to continue cooperation with the main (companies) because some plasma smallholders finished their cooperation. This would take time to re-run or continue the partnership.

“Many smallholders may guarantee their land certificates to others. This is issue for the banks. The unions or coordinators of unions are not conducive yet.  Smallholders’ income when having replanting, the numbers or replanting, and the numbers of factories without plantations are the issues too,” he said.

But Board of Editorials of PalmOilMagazine, Maruli Gultom said that palm oil has become the only commodity that masters the world while others, such as, chocolate, rubbers, and so on are the next commodities

The planters are dominated by the smallholders reaching 41%. If it is calculated, the smallholders are quite enough to contribute to the exchange, and even surpass non-oil and gas export. “There are about 1,2 million smallholders working in palm oil plantations,” Gultom said.

But the question remains, are they getting better? Palm oil is the main commodity of Indonesia but the industries are bothered by kinds of citation. “The fact is that to help palm oil industries, it would be better if the government does not intervene,” he said.


About Diskusi Sawit Bagi Negeri:

Diskusi Sawit Bagi Negeri is an interactive discussion among the stakeholders nationally. It presented many speakers from many backgrounds to give whole description about palm oil. The goal is to give the right understanding about the contribution and existence of palm oil to the country, social, and environment.

Diskusi Sawit Bagi Negeri got the fund supports from PFMA, IPOA, and SPKS with the strategic partner Palm Oil Magazine. It involved the stakeholders, such as, the government, the stakeholders, researchers, organizations, social and environmental activists, and others to discuss and develop palm oil in Indonesia.

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