Jakarta – The Association of Nucleus Estate and Plantation Smallholders (Aspekpir) said that the agriculture ministry regulation (Permentan) No.01/2018 on guidelines to determine the price of palm fresh fruit bunches (FFB) is the right policy to protect the price of FFB produced by smallholders.
“We’re comfortable with the application of Permentan 01/2018,” Aspekpir Chairman Setiyono said on Monday, 04 September 2022.
According to Setiyono, even if the Permentan is revised it cannot accommodate the interest of independent farmers, as the Permentan is aimed to regulate the partnership between smallholders and plantation companies.
He said that if the independent smallholders want to be accommodated in the Permentan 01/2018, they have to set up partnerships and establish first their institution. “If they don’t partner and have no institution, how can they set the price? But if the independent farmers don’t want to set up partnerships, the government should design a separate regulation,” said Setiyono.
But if the Permentan No.01/2018 has to be revised, it should be thoroughly weighed. “It should not lead to a condition where one problem solved but other ones emerged. Actually, the spirit of Permentan 01/2018 is partnership, not for independent smallholders,” he said.
Palm oil industry analyst Prof Dr Ponten Naibaho said that Permentan No 01/2018 as the basic mechanism of determining the price of FFB from smallholders is still relevant to be applied.
The professor of the University of Sumatera Utara (USU) said that the Permentan is aimed to protect oil palm growers and palm oil mills. For oil palm smallholders it guarantees purchasing price of FFB, while for the palm oil mills it guarantees the supply of raw material to sustain their industrial operations.
“It’s clear that price setting in the Permentan applies to all planters. There is no discrimination,” said Ponten.
According to him, for certain oil palm smallholders the point of contentious in the Permentan is its article 4 verse (1). It stipulates that plantation companies purchase FFB from their partner smallholders through planters’ institutions for processing and marketing according to their written employment agreement, which is recognized by regent/mayor or governor based on the required authority. The article is seen as an obstacle on ground implementation.
Regarding the issue, Ponten pointed out that based on the article the partner planters have understood it as a requirement for them to set up partnerships based on written agreement with the palm oil mills.
“Not only the plasma planters that can have their FFB bought by the palm oil mills, but also the independent planters, as long as they are grouped in Gapoktan or planters’ organizations, which are of course based on written agreements admitted by regent/mayor or governor according to needed authority,” said Ponten.
Ponten underlines the importance of common understanding and interpretation of the Permentan 01/2018. The Permentan makes a general definition of planters, no discrimination against the independent smallholders as long as they comply with all requirements set in the Permentan. It means that actually there is no need for the government to revise the Permentan.
“It’s the obligation of plantation companies to set up business partnerships based on the principles of mutual benefit, mutually responsible, mutually strengthening, and mutually supportive relations among the planters, workers, and people around the plantations. The principles are stipulated in article 57 of the law (UU) no.39/2014 on plantations. What’s needed the most is the supervision from the government,” he said.
Ponten asserted that Permentan No.01/2018 has complied with the rules of civil law on sale and purchase. The activities of buying and selling are related to civil matters, which are implemented based on several conditions that include such agreement and cannot be forced if there is no agreement.
“Basically, Permentan 01/2018 regulates the trading of FFB production of planters based on agreement that the FFB as a commodity must fulfill the raw material requirement of palm oil mills. If the FFB fails to comply with the requirements set in the agreement then the palm oil mills have the right to reject the FFB production,” he said. (*)
Source: RM.id (Rakyat Merdeka)
