Gapki: No Layoffs In Palm Oil Industry During Pandemic

JAKARTA – The Indonesian Palm Oil Association (Gapki) reported that there has been no layoffs in the palm oil industry during the outbreak of Covid-19 pandemic so far. But even better still, the palm oil industry is operating normally from upstream to downstream despite the pandemic.

“The palm oil industries employ around 16 million workers directly and indirectly. Despite the pandemic, there has been no layoff in the industries. The palm oil industries have become the main engine of economic growth and contribute foreign exchange from exports,” Gapki Communication Division Head Tofan Mahdi said during the 6th congress of the association of Indonesian television journalists (IJTI) on Friday, 29 October 2021.

He said that demand for the palm oil products was also high during the pandemic, sending their price high and has been staying at a very high level for quite some time.

“Gapki estimates that palm oil contribution of foreign exchange from exports can reach US$30 billion this year. It’s because prices of palm oil products are very high, while production stays normal,” he said.

Regarding the statement of President Joko Widodo (Jokowi) who wants Indonesia to stop exports of crude palm oil (CPO) and process it into various derivative products, he said that based on data of Gapki, around 61%  of Indonesia’s palm oil exports have been in the forms of processed products.

In 2020, of the total 34 million tons of Indonesian palm oil exports, only around  7.71 million tons in CPO. “Currently, the palm oil exports have been in the forms of processed products. But they are still half-processed products and not finished products with brands. This is a challenge for us all,” said Tofan.

According to him, to export palm oil in the forms of finished products such as soap and shampoo, more thorough and comprehensive preparations are needed as such products will have to compete with other existing products that have been in the market for long.

“If Indonesia wants to develop palm oil into finished products like soap and shampoo with own brands, then we need longer time for preparations as we have to deal with a different playing field. We have to compete with global manufacturers who are already well- placed in the global market of the consumer goods,” he said. (*)

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