Indonesia allocates 18 million hectares of land for palm oil

The Jakarta Post 2 Dec 09;

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.

Indonesia to expand oil palm estates amid environmental concerns
Riyadi Suparno and Nani Afrida, The Jakarta Post 3 Nov 09;

Despite environmental concerns, Indonesia plans to continue the expansion of its much-contested oil palm plantations to cover a total area of 18 million hectares, from the current 9.7 million, to generate more employment and improve people's welfare.

Coordinating Minister for the Economy Hatta Radjasa said on Wednesday that Indonesia would adopt "sustainable palm oil development" to ensure the expansion would not create more environmental problems.

"Sustainability is not an option, it's a must. Sustainability in the palm oil sector must cover all three aspects, social, economic and environmental," Hatta said after opening the 5th Indonesian Palm Oil Conference.

Hatta noted the government was committed to reducing greenhouse gas emissions by 26 percent by 2020, and that such a target could only be achieved by establishing new oil palm plantations.

Therefore, he said, the government would implement stricter regulations on clearing land for oil palm estates, and would work to reduce forest fires and illegal logging.

Indonesia, currently the world's largest palm oil producer, is considered one of the biggest emitters of CO2 from land use. Environmental activists have singled out the development of massive oil palm plantations as one of the biggest contributors to the emissions.

Indonesia has a total 9.7 million hectares of land that have been licensed for oil palm plantations, 9.7 million hectares of which are already planted, while 1.8 million remain empty. Indonesia produ-ces 19.2 million tons of palm oil per annum.

In comparison, Malaysia has 4 million hectares of oil palm plantations, and produces 16 million tons. Unlike Malaysia, Indonesia has more land to use for plantations.

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

Suswono also said that environmental concerns should not discourage the government, businesses and farmers from continuing to invest in the palm oil sector, noting that environmental concerns were exaggerated, while economic benefits were largely ignored.

"The emissions from opening new oil palm plantations are more in the form of CO2, and the oil palms to some extent absorb CO2. Compare that to methane emissions in the West, which are 23 times more dangerous than CO2," Suswono said.

In addition, the sector contributed US$12.4 billion in export revenue, the biggest outside the oil and gas sector, and employed 3.4 million households.

"But it doesn't mean that we ignore the environment. Ignoring the environment means we are committing suicide," he said.

Deputy agriculture minister, Bayu Khisnamurthi, said that Indonesia's palm oil sector was one of the booming sectors, and with the government's support and support from the banking sector, he predicted the country's output would double in the next decade to 40 million tons per year.