Indonesia allocates 18
million hectares of land
for palm oil

Indonesia's position as the world's number one palm oil producer would likely not be shaken in years to come as the country has 18 million hectares of land that could be used for palm oil plantations, almost doubling from the current 9.7 million hectares that have been licensed for palm oil estates.

Agriculture Minister Suswono said after the opening of the 5th Indonesian Palm Oil Conference in Nusa Dua, Bali, that of the total 9.7 million hectares, 7.9 million hectares are already planted with palm oil, while the remaining 1.8 million hectares still stand empty.

"Based on the land characteristics and the climate, we have a total of 18 million hectares of land, including the existing 9.7 million hectares, that potentially could be used for palm oil plantations, without disturbing our forest preservation efforts," Suswono said.

In addition to providing more areas for palm oil plantation, the government would also help improve the productivity of the existing plantations.

In comparison, Malaysia has only 4 million hectares of palm oil estates, but it produces 16 million tons of palm oil per annum. Indonesia has almost double the size, 7.9 million hectares, but produces only 19 million tons of palm oil.

Suswono said most of the lost productivity lies with plantations owned and managed by smallholders, which account for 41.4 percent of total plantation areas.

He said plantations belonging to smallholders produce 1.5 to 2 tons per hectare, while plantations managed by private companies produce 7 tons per hectare, while those managed by state-owned companies produce 4 to 5 tons per hectare.

"So, we are considering giving incentives to improve the productivity of estates belonging to smallholders," Suswono said.

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