Good Prospects Projected for Indonesian Palm Oil Business

Good prospects are projected for palm oil business in Indonesia, as reflected by the ever-increasing performance of the sector.

In 2017, the Indonesian Palm Oil Association (GAPKI) recorded that Indonesia’s crude palm oil (CPO) production reached 38.17 million metric tons, while palm kernel oil (PKO) scored 3.05 million metric tons.

The positive performance makes business players optimistic that the national palm oil industry will perform even better in the coming years.

Moreover, average CPO price in 2017 was considerably good at $714.3 per metric ton, compared to 2016’s price of about $700.4 per metric ton, which means that there was a 2% increase.

This year, CPO production is projected to increase by 10%. This projection was not an exaggeration, because the government is also boosting the replanting program for smallholder plantations.

The program commenced at the end of last year in a 4,460-hectare plantation in Musi Banyuasin district, South Sumatra. For every hectare, Rp25 million is earmarked, and high-quality oil palm seeds are also provided.

It is expected that the yield per hectare will increase from 2.5 metric tons of CPO to 8 metric tons. The government also partners with palm oil companies to accept the yield of smallholders.

The oil palm replanting program is planned to be held in other areas, covering a total of 14,574 hectares in five provinces: Riau, South Sumatra, Bengkulu, East Kalimantan, and South Kalimantan.

To support the growth, Indonesia’s palm oil industry certainly needs transport means that can meet the specific transport needs of plantations.

Those needs can be answered by TRAC, a subsidiary of PT Serasi Autoraya (SERA), that offers rental service of various types of vehicles, including for transport in plantation areas.

Business players can thus entrust transportation issue to TRAC and focus on their core business. This way, hopefully Indonesian palm oil business can perform even better.