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Smallholders Call For Founding of Palm Authority Body

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JAKARTA – Oil palm smallholders grouped under the Association of Indonesian Oil Palm Smallholders (Apkasindo) have urged the government to immediately establish a Palm Oil Authority Body, aimed at developing palm oil as a strategic commodity within Indonesia’s national development program.

Apkasindo Chairman Gulat ME Manurung said in a press statement on Monday (26 January 2026) that palm oil governance in Indonesia is currently fragmented across numerous ministries and institutions, resulting in overlapping regulations that hinder the progress of the nationally strategic sector.

“Currently, there are around 37 ministries and institutions managing the palm oil industry from upstream to downstream. It’s like a ship with 37 captains, each with an anchor. Certainly, it won’t sail,” Gulat stated.

According to him, the involvement of many institutions without a single central authority has led to unsynchronized and, in some cases, conflicting palm oil policies. Smallholder farmers are the most affected by this situation.

“Regulations become overlapping. This is what makes our palm oil governance ineffective and inefficient. Therefore, we urgently need the Palm Oil Authority Board,” he said.

Gulat explained that the idea of establishing an Indonesian Palm Oil Authority Board originated from a doctoral dissertation written by Dr. Mutiara Panjaitan from the Faculty of Law, University of Indonesia (UI). The dissertation comprehensively examined the complexity of national palm oil issues and proposed the establishment of a single authoritative body as the main solution.

“The dissertation is entitled *‘Solving Indonesia’s Palm Oil Problems with the Indonesian Palm Oil Authority Only.’ Conducting such a study is not easy. It requires comprehensive understanding and extensive experience in the palm oil sector,” he said.

The establishment of a palm oil authority body, according to Gulat, is intended to manage the palm oil industry as a strategic commodity under the national development agenda, promote higher economic growth, and maximize its contribution to public welfare.

Based on various academic studies, inter-ministerial consultations, and discussions with industry stakeholders, it has been concluded that there is an urgent need to optimize Indonesia’s palm oil governance by prioritizing national interests, justice, and consolidation of national strength.

This objective, he said, can be achieved through the formation of an institution capable of synergizing all stakeholders to improve upstream and downstream governance, increase productivity, optimize state revenue, enhance downstreaming, strengthen markets and research, conduct positive campaigns, and carry out trade diplomacy in strategic markets.

The establishment of an Indonesian Palm Oil Authority or a similar body is also considered increasingly urgent as a centralized entity responsible for collecting and integrating national data on palm oil production, consumption, licensing, and sustainability.

“This institution can respond quickly to global geopolitical dynamics while ensuring policy consistency to support the palm oil industry’s transition from an export commodity into a strategic pillar of national energy and food security,” Gulat stated.

Time for Palm Upstreaming?

In addition to calling for the establishment of a palm oil authority, Apkasindo has also urged the acceleration of palm oil upstreaming, namely strengthening the upstream sector, which is considered to lag behind downstream development. Gulat emphasized that the formation of a palm oil authority is crucial for implementing this upstreaming agenda.

“Strengthening the upstream sector and governance is key to the success of the palm oil downstreaming initiative, as envisioned by President Prabowo in the National Medium-Term Development Plan (RPJMN) targeting 8% economic growth,” he said.

Gulat further noted that recent natural disasters in Sumatra have served as an important reflection point for evaluating governance across the palm oil plantation sector. Although available data and audiovisual evidence indicate that palm oil plantations were not the primary cause of the disasters, they nevertheless highlight the need for improved governance of Indonesia’s palm oil industry.

Key measures proposed for strengthening the upstream sector and governance include:

  • Revitalization of palm oil institutions to harmonize policies and strengthen integrated upstream and downstream governance;

  • Establishment of a National Single Data of Palm Oil system consolidating all palm oil data into one integrated platform;

  • Creation of a single CPO exchange to ensure a fair, credible, and accountable reference price;

  • Formation of an integrated palm oil research center to increase productivity and diversify derivative products;

  • Acceleration of land tenure arrangements for smallholder oil palm plantations in forest areas;

  • Acceleration of replanting programs, infrastructure development, human resource improvement, and implementation of the Integrated Palm Oil Plantation Management System (STDB);

  • Acceleration of partnerships and fulfillment of the 20% Farmers’ Partnership Program (FPKM);

  • Strengthening smallholder institutions and downstream processing;

  • Improvement of oil palm farmers’ human resources through horizontal and vertical capacity-building approaches;

  • Implementation of artificial intelligence (AI) technology and automation in the palm oil plantation sector, particularly for smallholders.

CNBC Indonesia. “Ketua Petani Desak Bentuk Badan Otoritas Sawit, Untuk Apa?” (12 January 2026).
Riau Aktual. “Gulat Manurung Ungkap Urgensinya Pembentukan Badan Otoritas Sawit.”

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