JAKARTA – European Union (EU) still needs Indonesia’s palm oil products despite its application of EU Deforestation-Free Regulation (EUDR). In fact, the EU could not yet fully meet its local need of vegetable oils and until now it has to rely on imports.
Besides, its rising demand for biodiesel has also created a new opportunity for palm oil to continually try to penetrate the European market.
The oil palm plantation fund management board’s (BPDPKS) Corporate Division Head Achmad Maulizal Sutawijaya said that around 60% of Indonesia’s palm oil products are aimed for exports. “It means Indonesia contributes to the availability of various consumer goods, food products and energy for the world,” he said.
Considering the growth of global population that will reach around 9.8 billion in 2050 and rising urban population, there will be an increase of vegetable oil need of around 200 million tons, which can be fulfilled by palm oil as it is the most productive and most efficient vegetable oil compared to other vegetable oils.
“But with the implementation of EUDR in 2023, Indonesia’s biodiesel producers need to increase the sustainability of their supply chains, so that their market share of raw material for biodiesel production in EU will not drop,” Mauli said during a discussion on “Integrating Sustainable Palm Oil Industries From Upstream to Downstream” on Wednesday, 07 June 2023.
He said that Indonesia’s palm oil sector, which employs 2.4 million independent smallholders and 16 million workers, has continually pushed up the growth of GDP in plantation sector. In 2022, its export volume of palm oil reached 34.67 million tons with a total value of Rp34.5 trillion.
“The export levy of palm oil has been used, among others, to drive up the development of downstream palm oil industries. As a result, export of CPO has been declining, while exports of processed palm oil products have been increasing,” he said.
According to Mauli, to support the palm oil industries the government and stakeholders will take four strategic steps in EU. First, taking legal actions to tackle the problem of discrimination against Indonesia’s palm oil.
Second, pursuing bilateral relationships with member countries of EU to reduce discrimination against palm oil.
Third, implementing certification of sustainable palm oil which is internationally recognized to increase palm oil access to export markets.
“Fourth, launching media coverage by using the most reliable communication channels in three European countries: Germany, France and Belgium,” said Mauli.
Meanwhile, public policy analyst Khadikin of the economic coordinating ministry, said that Indonesia is the world’s largest producer of palm oil, contributing 51% of the global supply of palm oil. As a result, Indonesia plays a very important role in fulfilling the world’s vegetable oil need, which has been continually growing every year.
He said that as of now there are 2,511 palm oil companies operating in 26 provinces of Indonesia, with a total production of 47 million tons in 2022. “Indonesia is the world’s largest producer of palm oil with a global market share of 55 percent,” he said. (*)
Source: Bisnis.com
