The success of the B50 program is proof that collaboration between the government and the business world is able to strengthen food, energy, and economic resilience.

The national palm oil industry is showing its resilience amid various challenges. Despite facing the impact of El Nino, production, exports, and domestic consumption continue to grow. The success of the B50 biodiesel program is real proof of the strong collaboration between the government and the business world.

Indonesian Palm Oil Association (GAPKI) Chairman Eddy Martono conveyed this while opening the 22nd Indonesian Palm Oil Conference and 2027 Price Outlook (IPOC 2026) in Bali, Thursday (12/11/2026). The conference opening was attended by Minister of National Development Planning/Head of Bappenas Rachmat Pambudy and Deputy Minister of Foreign Affairs Arif Havas Oegroseno.

Eddy expressed his appreciation for the presence of the Minister of National Development Planning/Head of Bappenas. “Your support is not only an honor, but also a signal that this industry is important to the nation. We are truly grateful,” he said.

This year’s conference carries the theme “Palm Oil in Fragmented World: Securing Food, Energy and Economic Resilience”.

2026 Palm Oil Industry Performance: Production, Exports, and Domestic Consumption

Eddy explained that, up to September 2026, palm oil industry performance remains positive. Production reached 47 million tons, up 8.4 percent compared to the same period last year. Exports of palm oil, palm kernel oil, and oleochemicals reached more than 27.3 million tons, up 9.6 percent, with a foreign exchange value of US$32.3 billion. Domestic consumption reached 18.8 million tons, supported by the B50 program.

The Impact of El Nino on 2027 Palm Oil Production

The industry still needs to anticipate the impact of El Nino. GAPKI estimates that El Nino could cut production by up to 3 million tons, with the greatest impact in 2027. In a number of regions, farmers were forced to delay fertilizing, and fires hit plantations in several areas. This condition can reduce productivity, not only for one season, but also for subsequent seasons.

“However, there is something that gives us hope. Our CPO, oleochemical, and biodiesel exports continue to move. Foreign exchange continues to flow. Domestically, consumption remains strong thanks to the game-changing policy, namely B50,” said Eddy.

B50 Biodiesel: Supporting Domestic Consumption and Foreign Exchange

Eddy called B50 a very appropriate step by the government. Since it was implemented on 1 July 2026, its distribution up to August has reached 75-80 percent of the national territory. The program is estimated to save foreign exchange of Rp 170 trillion this year, absorb 14 million tons of crude palm oil (CPO), and support 2.1 million jobs.

“This is not merely a mandate, but an extraordinary step. On 1 July 2026, we made history,” he said.

Besides creating a strong domestic demand foundation, B50 also reduces emissions and supports farmers’ welfare. So that this achievement is sustainable, Eddy invited the government and the business world to continue strengthening synergy.

“To our partners in the government, with full respect we convey: let us strengthen synergy,” he said. According to him, a stable and predictable regulatory climate will make the Indonesian palm oil industry increasingly agile in competing in the global market. For this, all elements of government and the business world need to continue moving in harmony.

Productivity Investment: Pollinator Insects, Tanzanian Palm Seeds, and Smallholder Replanting

Eddy also presented GAPKI’s efforts to increase long-term productivity. In April 2026, GAPKI released two new species of pollinator insects, namely Elaeidobius subvittatus and Elaeidobius plagiatus, along with the existing species, Elaeidobius kamerunicus, which was brought from Tanzania. This step was taken to address palm oil pollination that has tended to be stagnant for decades.

In May 2026, GAPKI also distributed 29,281 wild palm seeds from Tanzania. The seeds consisted of 102 nigrescens and virescens accessions, including 18 tenera accessions, to enrich the national palm oil germplasm. From this genetic material, it is hoped that drought-tolerant palm varieties that are adaptive to climate change will be produced.

“This is our genetic insurance for the next generation. Leadership means not waiting for the perfect moment, but building the foundation to make it happen,” said Eddy.

He also invited all stakeholders to make smallholder palm oil replanting a national movement, given that many plantations are aging and smallholder palm productivity still needs to be improved. “We cannot move the future with machines from the past,” he said.

IEU-CEPA, EUDR Opportunities and ISPO Strengthening

On the global trade side, Eddy called the Indonesia-European Union Comprehensive Economic Partnership Agreement (IEU-CEPA) a toll road to one of the world’s largest markets. To take advantage of this opportunity, the industry needs to be ready to meet the provisions of the European Union Deforestation Regulation (EUDR) strategically and compliantly.

According to Eddy, ISPO needs to continue to be strengthened so that it becomes a global gold standard, as a form of national sovereignty and pride. In international forums, the palm oil industry is ready to become an advocate for smallholder farmers and the national certification system.

He emphasized that palm oil is not merely a commodity, but the foundation of Indonesia’s trade surplus and the largest contributor of export foreign exchange. “Looking to 2027, our optimism is not blind, but full of determination. With the right policies, we can turn today’s complexity into tomorrow’s opportunity,” said Eddy.

Eddy invited all participants to actively discuss and jointly build a more prosperous and sustainable future for the palm oil industry. (*)