PALMOILMAGAZINE, JAKARTA — The future of Indonesia’s palm oil industry cannot rely solely on the strength of large corporations. Behind the country’s 16 million hectares of palm oil plantations, more than 40% are managed by independent smallholder farmers. Yet, many of these farmers remain trapped in an uneven supply chain, facing unstable prices and dependence on middlemen.
To tackle these challenges, the Indonesian Palm Oil Association (GAPKI) and the Palm Oil Farmers Union (SPKS) have signed a Memorandum of Understanding (MoU), marking a new chapter in the relationship between industry players and farmers. The signing took place on June 17, 2025, at GAPKI’s headquarters in Jakarta, with GAPKI Chairman Eddy Martono and SPKS Chairman Sabarudin officiating the agreement.
This collaboration goes beyond a symbolic gesture—it is a strategic commitment to strengthen farmers’ institutional capacity, promote partnerships with companies, and support sustainability certification. For SPKS, it is a historic milestone: a new bridge linking the business world with farming communities that have long operated independently.
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A key focus of this partnership is to establish cooperative partnerships between farmer groups and GAPKI member companies, enabling farmers to bypass intermediaries who often suppress prices.
“Many SPKS cooperatives exist but still sell their harvests through middlemen. We want to change that. Farmers must be able to partner directly with companies in a fair and transparent system,” said Sabarudin in an official statement released by Palmoilmagazine.com on Monday, June 23, 2025.
With over 76,700 members spread across 22 districts in 11 provinces, SPKS has long supported palm oil farmers through training on good agricultural practices (GAP), cooperative strengthening, and assistance with the Palm Oil Replanting Program (PSR). Now, through this cooperation, SPKS aims to expand its impact, especially in helping farmers achieve ISPO (Indonesian Sustainable Palm Oil) certification as mandated by Presidential Regulation No. 16 of 2025.
GAPKI Chairman Eddy Martono emphasized that the partnership embodies a spirit of mutual cooperation between businesses and farmers. “We want SPKS members to become institutionally stronger, economically independent, and better prepared to meet global demands,” he said.
GAPKI also welcomes SPKS’s commitment to sustainability. Through this collaboration, training and technology transfer to farmers will be enhanced, including facilitating production tools and a sales system that benefits farmers more equitably.
“This is not just about certification or paperwork. It’s about real changes on the ground. GAPKI and SPKS will ensure this transformation happens based on equality and sustainability principles,” added Eddy.
Advancing Governance and Sustainability in Palm Oil
Beyond economic benefits, the GAPKI-SPKS partnership aims to improve governance within the national palm oil industry. Both parties agree on building a system that is more transparent, fair, and aligned with sustainable development principles.
This initiative answers mounting pressure from global markets on environmental issues, product traceability, and farmers’ rights. GAPKI views the collaboration with SPKS as strengthening Indonesia’s palm oil industry to compete ethically and credibly on the international stage.
“We cannot move forward alone. The palm oil industry will thrive if businesses and farmers support each other, trust each other, and profit together,” Eddy stated.
For SPKS, this cooperation also provides a platform to accelerate farmers’ transformation towards global standards. “We believe smallholder palm oil farmers can become a powerful force if supported with access, knowledge, and fairness,” said Sabarudin.
He added that SPKS is ready to actively assist with ISPO certification, expand the PSR program, and strengthen cooperatives as the economic backbone of farmers.
With this partnership, GAPKI and SPKS hope to establish a system that benefits not only large corporations but also empowers farmers as key players in Indonesia’s palm oil supply chain.
Sustainable palm oil is no longer just an aspiration—it is a commitment starting from the grassroots level, from the smallholder farms whose voices have often been unheard. Now, with GAPKI’s support, those voices grow louder and gain clearer direction. (P2)
