MEDAN – The Indonesian Palm Oil Association (GAPKI) Chairman Eddy Martono has stated that Indonesia’s palm oil industry is facing national and global challenges which require a well-knit collaboration among all stakeholders to successfully weather through those pressing problems.
Addressing the Indonesian Palm Oil Stakeholders Forum (IPOS-Forum) 2024 in Medan, North Sumatra, on Thursday (30/5/2024), Eddy Martono said that nationally the palm oil industries are dealing with four challenges. First, Indonesia is now grappling with the problem of stagnant growth of palm oil production, while its local demand for foods and bioenergy has been continually rising.
Second, the implementation of article 110A and 110B of the omnibus law on job creation will result in millions hectares of oil plantations unable to continue their operations as they are suspected to encroach forest areas and will have to be reforested after finalizing their one cycle of cultivation.
Third, the rising public demand for the oil palm plantations companies to comply with the agriculture minister regulation (Permentan) No.26/2007 on developing small-scale plantations for the local people at the size of 20% from their total acreages. Many cases of such public demand had turned anarchic. “Recently, several member companies of GAPKI in Central Kalimantan had to deal with such anarchic cases. If left unresolved it will spread to other regions. This creates legal uncertainty and threatens the sustainability of investments,” Eddy said.
Fourth, the problem of palm oil mills without having palm plantations as stipulated under the government regulation (PP) No.5/2021 on the operation of licenses businesses based on risks.
He said that besides the national problems, Indonesia’s palm oil industries are also dealing with challenges at the global market, which include incessant negative campaigns and the incoming implementation of European Union Deforestation-free Regulation (EUDR) .
“All speakers and participants in this IPOS Forum can discuss those problems thoroughly. I’m confident that this forum will come up with effective solutions, which will be presented to the government to solve the problems, including to improve the governance in the palm oil industries and the investment climate in the industry,” said Eddy.
“We need to strengthen our synergy among all stakeholders in resolving those problems. We also need to continually coordinate with the central government and regional governments to solve the problems that hinder the implementation of replanting program for smallholders under partnerships with companies,” Eddy said, adding that the replanting program is expected to increase productivity and sustainability of palm oil.
During the same occasion, GAPKI North Sumatra (Sumut) Office Head Timbas Prasad Ginting told the press that the prevailing regulations hinder the implementation of replanting program for smallholders. “There should be a harmonization of regulations regarding the implementation of replanting program. It is particularly concerned with the problem of plantations suspected to have encroached forest areas,” he said.
Timbas noted that there are many smallholders who have already had their certificates of land ownership (SHM) but they did not get the replanting fund from the government, so that they could not implement replanting program for their plantations.
The IPOS Forum was formally opened on Thursday by Acting Governor of Sumut, Hassanudin, who said that as the main driver of North Sumatra’s provincial economy, the palm oil industry in the province should grow better and stronger in the future.
According to him, North Sumatra has a total oil palm acreage at around 1.4 million hectares with total production of fresh fruit bunches (FFB) at around 24 million tons per year. “The palm oil sector is a strategic industry for North Sumatra. It is one of the largest absorbers of workers in this province. There are 237 palm plantation companies operating in Sumut,” he said. (*)
Source: waspada.id / sawitindonesia.com
