JAKARTA – The Indonesian government has stated that it will keep striving to realize the target of its national program to replant the smallholders’ oil palm plantations with a view to increasing their productivity and their welfare. The government has launched the replanting program since 2015 by providing financial assistance for the smallholders.
The government, through the oil palm plantation fund management board (BPDPKS) provides a financial assistance of Rp30 million for every hectare of the smallholders’ oil palm plantation which is included in the replanting program.
Of the total 6.9 million hectares of oil palm plantations owned by smallholders in Indonesia, at least 2.8 million hectares are seen potential to undergo the replanting program. But until 2022, the total plantations that have undertaken the replanting program were only 273,666 from the target of 540,000 hectares in 2024.
The lower realization of the replanting program is due to a number of factors, including weather condition of extreme wet, which had negatively affected the production activities.
Besides, the high price of palm oil had also discouraged the smallholders to participate in the replanting program. The smallholders are also discouraged by the shortage of fund provided for the implementation of the program.
Based on data from the government, every hectare that is included in the replanting program needs funding at around Rp50 – 65 million per hectare from the initial stage of planting seedlings (P0) up to reaching production (P3). Even in peatland areas, every hectare needs Rp89 million from P0 to P3.
Rizal Affandi Lukman, a special staff on international economic cooperation to Economic Coordinating Minister Airlangga Hartarto, said that the government will keep pursuing efforts to realize the target of the replanting program for the smallholders in Indonesia. “Therefore, within the next two years, we have to work hard to reach the replanting target and keep improving the welfare of smallholders,” Rizal Affandi said during the event of “Palm Oil Financing Forum: How Banks & Financial Institutions Support the Replanting Program”, which was organized by Warta Ekonomi Group recently in Jakarta.
The public discussion was also addressed by Prayudi Syamsuri (Director of plantation products processing and marketing at directorate general of plantations of the agriculture ministry), Aziz Hidayat (Head of plantation division at the Indonesian Palm Oil Association (GAPKI), Gulat Manurung (Chairman of the association of Indonesian smallholders (APKASINDO) and Natalia Veronica (Division Head of Value Chain Assets & Product Development Division Bank Rakyat Indonesia). (*)
Source: jpnn.com
