Jakarta, Oct 13 (Antara) - Indonesia, the world's largest crude palm oil (CPO) producer, has begun rejuvenating its oil palm plantations as some of its 11.6 million hectare plantations are now aging.
Rejuvenating its palm plantations is very important for Indonesia to maintain its reputation as the world's largest CPO exporter. Hence, Indonesia is now beginning to renovate its plantations especially in Sumatra.
President Joko Widodo (Jokowi) said the government will continue to rejuvenate the country's oil palm plantations, starting from Sumatra. The President made the remarks when inaugurating the rejuvenation of thousands of hectares of oil palm plantations in Musi Banyuasin District, South Sumatra on Friday.
The aim of plantation rejuvenation is to make the economy continue to increase. Moreover, CPO plays a significant role in the country's economy.
As some plantations are old, there has been a downward trend in CPO production. According to the Palm Oil Plantation Fund Managing Board (BPDP), CPO exports fell two percent by volume in 2015, while production dropped by about seven percent.
President Jokowi said the oil palm plantations are rejuvenated so that they would become more productive. "Moreover, oil palm plantations in this province (South Sumatra) are quite wide and the rejuvenated ones reach 4,400 hectares," Jokowi said.
The inauguration of oil palm rejuvenation was also marked with the presentation of seedlings (to the farmers) from the Minister of Agriculture and with the first planting of the palm seedlings in Panca Tunggal Village, Sungai Lilin, Musi Banyuasin.
Currently, Indonesia is estimated to have 11.6 million hectares of palm oil plantations. Of this total, some eight percent are managed by state companies, 49 percent by private CPO industries, and 43 percent belong to small farmers. The livelihood of about 16-20 million people depends on upstream and downstream palm oil businesses across Indonesia.
For local farmers, the government provides seedlings. Jokowi said this oil palm rejuvenation seedlings were provided by the government. It hoped that with the rejuvenated palm, plantation can be productive with a yield of about 8 tons of CPO per hectare, he said.
Moreover, the government will help make clear the status of plantation land to avoid dispute over ownership. The palm oil plantations in productive forest which belong to the local people will be cleared, he said. The President has ordered the relevant minister with regard to the land acquisition.
Moreover, now there is often the problem of land dispute due to lack of clear status which needs certificates, the president said. He hoped that the palm rejuvenation would continue to be maintained in order to make the plantations more productive.
The President said, oil palm renovation will continue to be carried out, especially in Sumatra. After those in South Sumatra Province, next month, oil palm plantations in North Sumatra, Jambi and Riau provinces will also be rejuvenated.
With plantation renewal, the government hopes Indonesia's CPO production would not fall.
In 2016, Indonesia produced over 35 million tons of crude palm oil, and 25 million tons were exported worldwide, mainly to India, China, Pakistan, and the Netherlands, bringing in US$17.8 billion in revenue, or about an eighth of the country's total export proceeds.
At the end of 2015, palm oil fruit production fell due to the El Nino-induced drought. Exports fell two percent by volume, as production dropped by seven percent, according to the BPDP.
In the same year, Indonesia's CPO production accounted for 32.5 million tons, with exports reaching 26.4 million tons. The export value went down from US$21.1 billion in 2014 to $18.6 billion in 2015.
Indonesia's exports of CPO and its derivatives fell by five percent to 25.1 million tons in 2016, from 26.4 million tons in 2015. However, its production also dropped 35 million tons in 2016, from 35.5 million tons in the previous year.
In the long run, the Industry Ministry is encouraging the palm oil processing industry to utilize the latest technology, so that it will produce various downstream products, such as super edible oils, golden nutrition, bioplastics, biosurfactants, and green fuels.
Industry Minister Airlangga Hartarto said early this year that in order to boost the development of the palm oil downstream industry, the government has, since 2012, applied a fiscal policy instrument thorough the imposition of a progressive export tax and a plantation fund-raising policy since 2015.
With the implementation of these policies, the export ratio of upstream products since 2013 has shifted from 70 percent to 30 percent, while on the other hand, the export ratio of downstream palm oil products has increased from 30 percent to 70 percent.***3***
(a014/ )(T.A014/A/BESSR/Suharto) 14-10-2017 00:24:1 |
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