Palm Oil Today Indonesia Vol 1 No 1

Page 1

July - September 2020



Don’t Panic with the Pandemic Hear from Major Players of the Palm Oil Industry! Interview with:

Interview with:

Datuk Nageeb Wahab, Chief Executive of Malaysian Palm Oil Association (MPOA)

Dr. Ahmad Parveez Ghulam Kadir, Director General of Malaysian Palm Oil Board (MPOB)

INDUSTRY 4.0 IN PALM OIL MILLS Official Magazine of :

A Publication of : INDONESIA


Incorporated in 1996 in Indonesia with the target to be one of the leading companies to provide distributed power in Indonesia, Kaltimex Energy was the pioneer company to obtain The First IPP license in the private sector to operate a 23 MW Power Plant, for a large textile company in Central Java. Since then, Kaltimex Energy has installed 500MW in Kalimantan, Sulawesi and Sumatera including for Rental (PLN), Palm Oil and Sugar sector. and Transfer (B.O.O.T) basis or as an Independent Power Producer (IPP). Kaltimex Energy is also proud to serve the Palm Oil & Sugar Industry in Indonesia, having installed more than 220 units of Siemens – Dresser Rand Steam Turbines, generating around 300 MW of electricity in total. With the development and the necessity to move towards greener and sustainable energy, Kaltimex Group is now actively developing Renewable Energy projects through the usage of Biogas, implements international standards for Quality Management System, Environment Management System and Occupational Health & Safety Management System (HSE) to ensure that the services delivered are best in the class.

STEAM TURBINES Kaltimex Energy represent the world’s leader in Steam Turbines; Dresser-Rand (A Siemens owned business), for the non-oil & gas market of Indonesia.Dresser-Rand has one of the most comprehensive steam turbine selections in the industry and provide solutions for paper mills, steel, sugar, district energy, marine and palm oil. Applications include combined cycle, cogeneration, combined heat and power (CHP), biomass, and waste-to-energy. Kaltimex Energy is proud of the over 200 units of Siemens Dresser-Rand Steam Turbines it has successfully packaged, installed & commissioned across Indonesia.

GAS ENGINES Range from 400 kW to 4,500 kW. In this way, it is possible to set up power plants with an output of up to MWM's installations in Indonesia have reached more than 420 MW, spread across the country. The amount has given a clear message that MWM's brand is proven and well accepted in Indonesia.

BIOGAS TECHNOLOGY As a Total Power Solutions company, we have a higher calling to develop power plants from renewable energy sources, such as Municipal Solid Waste, Agricultural Waste and any other Organic or Inorganic Waste. Kaltimex Energy is proud to announce that we have recently entered into an exclusive agreement with Wabio Technologie, GmbH to develop Biogas Plants. The Biogas after going through a biogas desulphurization process could be directly to fed to Gas Engines to generate electricity.

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EDITOR’S MESSAGE Greetings Readers! Welcome to our inaugural edition of Palm Oil Today Indonesia, affiliated with Asia Palm Oil Magazine, it would be published quarterly and readily available on both print and digital editions! Its bilingual format of Bahasa Indonesia and English would also cater to both local and international readers alike with ease. The current pandemic has been a major talking point globally. Never in our lives have we been so sceptical by the simple gesture of a handshake. World markets came crumbling to our feet and the economy came to a screeching halt. A scene akin to the end of the world.

Managing Editor Susan Tricia

Publications Manager Amelia Lim

ŝŶĚŽΛĮƌĞǁŽƌŬƐďŝ͘ĐŽŵ Editorial Consultant Kenny Yong

Content Editor Nur Atthirah Zawanah Azmee

Media Executives Paulina

Graphic Designer Felicia Zhang

Publisher :

The palm oil industry currently faces major disruptions in production with many countries “locked down”. There’s a heavy scent of uncertainty lingering in the air with no light at the end of the tunnel. Day after day, the headlines are engulfed with negative news of the pandemic spreading like wildfire with no signs of retreat. This is indeed a war, a biological war, where the world unites and join hands to fight this elusive enemy. I must say though by the time this magazine is published, small rays of light could finally be seen emerging, giving us more clarity on where this pandemic would be headed to. Despite all the negativity, there are some good takeaway lessons we could learn during turbulent times like this. For once, the skies are getting clearer with lesser pollution due to a majority of civilization being cooped up at home, we learn that working from home is NOT ideal but it could be “do-able” with the right planning, businesses get to see their immediate weaknesses and re-innovate to be more efficient, we start to take hygiene more seriously (I’m sure you wash your hands more often now and of course who can ever forget, good quality family time. You would be spending at least 14 days at home now with your loved ones and kids just doing things that you never had the time to do! On behalf of my team (who are all at home at this time of writing) and I, we would like to urge everyone to take the “safety distancing” measures of your relevant government authorities seriously because only by distancing ourselves for now, we could keep the virus shackled. So go on indulge yourself in this quarter’s read and I look forward to having your comments or views via email at: Stay safe, adhere to good distancing measures and let’s beat this pandemic together! Susan Tricia Managing Editor

DISCLAIMER The content of Palm Oil Indonesia Today Magazine (and website) does not necessarily reflect the views of the editor or publishers and are the views of its contributors and advertisers. The digital edition may include hyperlinks to third-party content, advertising, or websites, provided for the sake of convenience and interest. The publishers accept no legal responsibility for loss arising from information in this publication and do not endorse any advertising or products available from external sources. Palm Oil Indonesia Today Magazine and its website does not warrant that the information in it will be error-free or will meet any particular criteria of performance or quality. Your use of the information contained in the Palm Oil Indonesia Today magazine and website is at your own risk. You assume full

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responsibility and risk of loss resulting from the use of this website or information in it. None of Palm Oil Indonesia Today, PT Fireworks Indonesia or its affiliates, or any partners, principals, stockholders or employees of any thereof will be liable for any special, indirect, incidental, consequential or punitive damages or any other damages whatsoever, whether in an action of contract, statute, tort (including, without limitation, negligence) or otherwise, relating to the use of this website or information contained in it. No part of this publication may be reproduced or stored in a retrieval system without the written consent of the publishers. All rights reserved.

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- (BHS) Malaysia Mengkritik Saran WHO terhadap Minyak Kelapa Sawit selama masa wabah Covid 19


- (BHS) Industri kepala sawit di Indonesia perlu terus beroperasi di tengah pandemic covid-19. Loh?


- (BHS) Penutupan akses keluar masuk yang di sebabkan oleh Coronavirus akan mengurangi permintaan minyak

(ENG) Malaysia critics WHO’s advice against Palm oil during Covid-19 outbreak

kelapa sawit


(ENG) Coronavirus-Driven lockdowns to dent demand for palm oil during ramadhan 10

- (BHS) Komersialisasi MPOB untuk teknologi minyak kelapa sawit mencapai 3 milyar ringgit Malaysia


- (BHS) Badan Usaha Milik Negara Indonesia, PT Pertamina Meminta Agar Parlemen Membatasi Harga Minyak

(ENG) MPOB commercialisation of palm oil technologies hits rm3b Kelapa Sawit Mentah (CPO), Karena Perusahaan Tersebut Sedang Mengembangkan Kilang Untuk Membuat Bahan Bakar Dari Minyak Nabati. (ENG) Indonesia State Energy Company PT Pertamina Asked Parliament To Cap Prices For Some Crude Palm Oil (CPO), As The Company Develops Refineries To Make Fuel From The Vegetable Oil. 7


- (BHS) India merubah peraturan untuk impor minyak kelapa sawit murni


- (BHS) Golden Africa mempunyai gagasan besar di afrika selatan

(ENG) India modifies rules for refined palm oil imports (ENG) Golden Africa thinks big in East Africa 10



- (BHS) Sejarah kelapa minyak sawit (ENG) The History of Palm Oil


- (BHS) Jangan panik dengan pandemi (ENG) Don’t panic with the pandemic



- (BHS) Menteri industry perkebunan dan komoditas, CPOPC membahas masalah pada industri minyak kepala sawit Negara (ENG) Plantation minister, CPOPC discuss issues on country’s palm oil industry


- (BHS) Laba kuartal pertama genting plantations melonjak lebih dari dua kali lipat menjadi 91.3 juta ringgit Malaysia karena harga kelapa sawit yang tinggi. (ENG) Genting plantations 1Q profit jumps more than twofold to RM91.3m on higher palm prices



- (BHS) Pedoman produksi minyak kelapa sawit berkelanjutan (ENG) Guidelines on sustainable palm oil production

28 24

- (BHS) Permintaan Bahan Bakar Nabati di EU Tetap Stabil, sahut Lipido Santiga (ENG) Biodiesel Demand in the EU to Remain Stable, Says Lipidos Santiga







- (BHS) Industri minyak nabati india menginginkan pembatasan impor minyak kelapa sawit murni (ENG) India’s Edible Oil industry wants import of refined palm oil to be restricted



- (ENG) : Steering the Indonesian Palm Oil Industry out of the Pandemic


- (BHS) Industri 4.0 di pabrik minyak kelapa sawit (ENG) Industry 4.0 in palm oil mills


Palm Oil Today Indonesia



Malaysia mengkritik Organisasi Kesehatan Dunia karena menasihati orang dewasa untuk menghindari konsumsi minyak kelapa sawit dalam makanan mereka selama wabah COVID-19 dan menggunakan alternatif lain seperti minyak zaitun. Kantor Wilayah Mediterania Timur WHO menyatakan pada nasihat baru-baru ini bahwa orang-orang harus mengkonsumsi lemak tak jenuh yang bisa ditemukan dalam ikan, alpokat, kacang-kacangan, minyak zaitun, kedelai, kanola, minyak bunga matahari dan minyak jagung; daripada lemak jenuh yang ditemukan dalam daging berlemak, mentega, minyak kelapa sawit dan minyak kelapa, krim, keju, minyak samin serta lemak babi. Malaysia, produsen minyak kelapa sawit terbesar kedua, mengatakan kalau nasihat seperti itu “kuno”. "Berkenaan dengan lemak makanan sebagai sumber utama kalori, WHO melalui nasihat terbarunya kembali jatuh pada topik yang sama yaitu mempromosikan minyak komoditas tertntu sambil menyisihkan minyak kelapa sawit,” kata Sundram, presiden direktur Malaysian Palm Oil Council (MPOC), sebuah badan negara yang bertanggung jawab mempromosikan komoditas tersebut, dalam artikel opini MPOC. Kantor Wilayah Mediterania Timur WHO tidak langsung menanggapi permintaan komentar atas posisi MPOC. Dalam artikel MPOC disebutkan bahwa minyak kelapa sawit memiliki keseimbangan antara lemak jenuh dan lemak tidak jenuh untuk memastikan penyerapan berbagai nutrisi mikro, tidak lagi diperlukan hidrogenasi pengolahan minyak dengan hydrogen untuk meningkatkan masa kadaluarsa dan tersedia dalam jumlah besar. "Di negara-negara yang konsumsi lemaknya masih di bawah rekomendasi WHO, seperti halnya di sebagian besar Asia dan Afrika, fokus kesehatannya berbeda,” sahut MPOC. “Kebutuhan untuk menyediakan sumber kalori yang terpercaya, berkelanjutan dan terjangkau agar masalah kekurangan gizi dapat dihindari (dan meningkatkan imunitas terhadap infeksi) adalah yang terpenting.” Kalyana mengatakan WHO seharusnya fokus untuk memberikan “gagasan manajemen kesehatan yang berbeda” dan bukan memberikan “pesan-pesan kuno”. Minyak kelapa sawit digunakan dalam segala hal mulai dari susu formula hingga kue, namun permintaan minyak sayur telah menurun karena penutupan restoran- restoran terkait penutupan akses keluar masuk di banyak negara. Negera bertetangga Malaysia and Indonesia sama-sama menghasilkan 85 persen minyak kelapa sawit dunia, namun industri tersebut menghadapi kritik keras dari para pecinta lingkungan atas penebangan pohon di hutan tropikal demi menanam tanaman yang lebih menguntungkan.


INDUSTRY NEWS MALAYSIA CRITICISES WHO’S ADVICE AGAINST PALM OIL DURING COVID-19 OUTBREAK Malaysia criticised the World Health Organisation for advising adults to avoid palm oil in their diet during the COVID-19 outbreak and use alternatives such as olive oil. The WHO Eastern Mediterranean Regional Office said in a recent advisory that people should consume unsaturated fats found in fish, avocado, nuts, olive oil, soy, canola, sunflower and corn oils rather than saturated fats found in fatty meat, butter, palm and coconut oils, cream, cheese, ghee and lard. Malaysia, the world's second biggest producer of palm oil, said such advice was "antiquated". "With regards to dietary fats as a major source of calories, WHO through its most recent advisory has again fallen into the same previous well of promoting certain commodity oils while brushing aside palm oil," Kalyana Sundram, CEO of the Malaysian Palm Oil Council (MPOC), a state agency responsible for promoting the commodity, said in an MPOC opinion piece. The WHO Regional Office for the Eastern Mediterranean did not immediately respond to a request for comment on the MPOC's position. The MPOC article said palm oil has a natural balance of saturated and unsaturated fats to ensure the absorption of various dietary micronutrients, does not require hydrogenation treating oils with hydrogen to increase their shelf life and is available in large quantities. "In countries where fat consumption is below recommendations of the WHO, as is the case in large parts of Asia and Africa, health focus is different," the MPOC said. "The need to provide a reliable, sustainable and affordable source of calories to ward of undernutrition (and increased susceptibility of infection) is paramount." Kalyana said the WHO should focus on coming up with "radically different health management ideas" instead of falling back on "antiquated messages". Palm oil is used in everything from infant formula to cookies, but demand for the vegetable oil has been hammered due to the closure of restaurants during virus-linked lockdowns in many countries. Neighbours Malaysia and Indonesia together produce 85 per cent of the world's palm oil, but the industry has faced intense criticism from environmentalists over mass stripping of tropical forests to grow the lucrative crop.


Palm Oil Today Indonesia

Industri Sawit Perlu Terus Beroperasi di Tengah Pandemi COVID-19. Lho?


akarta – Adalah Joko Supriyono, Ketua Umum Gabungan Pengusaha Kelapa Sawit Indonesia (GAPKI) yang sangat mendukung apabila industri sawit baik perkebunan atau pabrik perlu terus beroperasi di tengah pandemi COVID-19 karena untuk memenuhi kebutuhan pangan serta non pangan, seperti sabun antiseptik dan hand sanitizer untuk membantu pemerintah mencegah meluasnya Pandemi Covid-19 atau Corona. “Industri sawit merupakan bagian dari rantai pasok kebutuhan pangan dan non pangan yang sangat penting bagi masyarakat,” ujar Joko di Jakarta, beberpa waktu lalu. Joko meminta kegiatan operasional perkebunan dan pengolahan sawit tidak mendapatkan hambatan di daerah. Pasalnya, ada laporan dari anggota GAPKI sempat muncul isu penghentian sementara operasional dan kegiatan logistik termasuk sawit. “Beberapa waktu lalu, di beberapa derah muncul isu setop angkutan transportasi TBS dan CPO. Ada kekhawatiran, pemerintah daerah akan mengikuti Jakarta sebagai rujukan pembatasan sosial. Saya telah menginstruksikan pengurus Gapki di daerah untuk mengawal isu tersebut selama pandemi Corona,” tegas Alumni Fakultas Pertanian Universitas Gajah Mada (UGM) ini. Menurut pria yang hobi Wayang Kulit ini, pemerintah pusat maupun daerah harus memahami bahwa kelapa sawit ini bersifat strategis. Produk turunan sawit menjadi bahan baku utama kebutuhan pangan seperti minyak goreng dan produk makanan lainnya. Tak berhenti di situ, kandungan sabun antiseptik dan hand sanitizer berbahan

baku dari sawit seperti gliserin. Belum lagi, industri sawit ditugaskan memasok biodiesel untuk sektor transportasi. Jika kebun dan pabrik dihentikan operasionalnya, maka suplai maupun distribusi produk berbahan sawit bisa terganggu. Jadi, wajar saja kalau Joko sangat berharap tidak ada penutupan atas operasional industri sawit di tanah air. Dalam hal ini, pemerintah daerah tidak membuat aturan yang melarang pabrik beroperasi. Sebab, apabila pabrik berhenti akan berdampak kepada petani. Dari luasan 16,3 juta perkebunan sawit, petani mengelola sekitar 42%. “Kalau pabrik ditutup, petani menjadi sangat dirugikan. Dampaknya akan berimbas kepada perekonomian dan kondisi sosial wilayah setempat,” ujarnya. Untuk mencegah meluasnya Covid-19, Joko menerangkan, GAPKI telah menerbitkan Protokol Kesehatan untuk menjadi perusahaan anggotanya. “Kami mengajak semua pengurus pusat, cabang dan perkebunan kelapa sawit anggota Gapki untuk pro-aktif melakukan upaya pencegahan penularan melalui menghindari interaksi di keramaian/kerumunan dan upaya pencegahan lainnya seperti penggunaan masker dan wajib cuci tangan,” kata Joko. Dan, GAPKI telah mensosialisasikan protokol ini kepada 13 cabang di daerah yaitu Aceh, Sumatera Utara, Sumatera Barat, Sumatera Selatan, Riau, Bengkulu, Jambi, Kalimantan Timur, Kalimantan Barat, Kalimantan Selatan, Kalimantan Tengah, Kalimantan Utara, dan Sulawesi.

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Palm Oil Today Indonesia

Penutupan Akses Keluar Masuk yang Disebabkan oleh Coronavirus Akan Mengurangi Permintaan Minyak Kelapa Sawit Selama Bulan Ramadhan


asar minyak kelapa sawit diperkirakan akan kehilangan periode penting dengan permintaan tinggi pada tahun 2020 dikarenakan penutupan akses keluar masuk yang disebabkan coronavirus selama bulan suci Ramadhan, dimana akan mengurangi permintaan dari Negara-negara importir seperti India, Pakistan dan Bangladesh. Permintaan yang lebih rendah dari biasanya akan bisa memberikan tekanan pada patokan harga minyak kelapa sawit mentah Malaysia, yang telah turun hampir 30% sejak 23 Januari. Hal ini terjadi sejak Tiongkok, selaku konsumen minyak kelapa sawit terbesar kedua, memberlakukan penutupan akses keluar masuk terkait coronavirus. Permintaan minyak kelapa sawit biasanya meningkat dua bulan sebelum bulan Ramadhan, terhitung dari tanggal 23 April 2020 hingga 23 Mei 2020 pada Hari Raya Idul Fitri (Eid al-Fitr). Para importir biasanya mulai mengadakan persediaan minyak nabati dalam rangka mengantisipasi peningkatan konsumsi makanan ketika keluarga dan teman-teman berkumpul pada saat berbuka puasa. Dalam kondisi orang-orang ditutup akses keluar masuknya tidak dapat berkumpul seperti biasa dalam tahun ini dan berhubungan dengan banyaknya restoran, kantin dan hotel yang tidak beroperasional iftar, atau berbuka puasa dilakukan dalam skala yang kecil. Pembelian dari para pelanggan utama bulan Ramadhan India, Bangladesh, Pakistan, Arab Saudi dan Iran mulai meninggkat pada awal bulan Maret, namun semakin merosot dengan adanya langkah-langkah penutupan akses keluar masuk dari pemerintah-pemerintah, menurut para pedagang dan analis. “Kami telah kehilangan momen pada saat biasanya permintaan meningkat pada bulan Ramadhan, kami seharusnya melihat kenaikan angka pengiriman ke daerah Timur Tengah pada awal bulan Maret,” sahut Sathia Varga, pemilik Palm Oil Analytics yang berbasis di Singapura. Ekspor minyak kelapa sawit dari Malaysia selama bulan Maret, produsen terbesar kedua, turun 27% dibandingkan dengan bulan yang sama di tahun lalu menjadi 1,181,422 ton, angka terendah sejak tahun 2016, menurut data dari Malaysian Palm Oil Board. Angka ekspor bulan Maret dari produsen utama di Indonesia lebih tinggi dibandingkan bulan Februari, namun turun 3% dibandingkan tahun sebelumnya menjadi 1,885,153 ton, menurut data dari Refinitiv. “Pelanggan dari daerah Timur Tengah sedang dalam penutupan akses keluar masuk, sehingga susah untuk mencapai angka puncak musiman,” kata Varga. India, yang juga merupakan konsumen terbesar minyak nabati, di mana hotel, restoran dan industri katering merupakan pengguna utama minyak kelapa sawit, mengalami penurunan permintaan pada sector ini sebanyak 40% karena penutupan akses keluar masuk nasional, menurut hasil analisa yang diterbitkan oleh Malaysian Palm Oil Council (MPOC). Permintaan minyak kelapa sawit India biasanya meningkat sekitar 10% pada masa-masa seperti bulan Ramadhan, namun tahun ini kenaikan demikian sangat tidak mungkin, menurut Sudhakar Desai, presiden dari Indian Vegetable Oil Producers’ Association (IVPA). “Untuk pertama kalinya tahun ini kita akan melihat penurunan angka konsumsi per kapita,” lanjut Desai. Angka impor nasional anjlok 58% dari tahun sebelumnya menjadi 335,308 ton, menurut data yang dikumpulkan oleh badan industri Solvent Extractors’ Association yang berbasis di Mumbai. Pada bulan April, angka impor minyak kelapa sawit India bisa menurun ke 450,000 ton dibandingkan 707,450 ton pada tahun sebelumnya, kata Desai dari IVPA. Angka impor minyak kelapa sawit Pakistan pada bulan Maret lebih rendah sekitar 40,000 – 50,000 ton dari angka ekspektasi industri, sementara perdagangan di pasar domestic Bangladesh juga melambat sejak pertengahan bulan Maret, menurut hasil analisa MPOC. “Daya beli sedang menurun. Masyarakat kehilangan pekerjaan ataupun mengalami pemotongan penghasilan. Hal ini akan berdampak pada konsumsi minyak kelapa sawit,” menurut seorang pengusaha perdagangan global di Mumbai. – Reuters

Coronavirus-Driven Lockdowns To Dent Demand For Palm Oil During Ramadan The palm oil market is set to miss out on a key high-demand period in 2020 as coronavirus driven lockdowns during the Muslim holy month of Ramadan dent demand in key importing countries such as India, Pakistan and Bangladesh. Lower than normal demand could put pressure on Malaysia’s benchmark crude palm oil


prices, which have already fallen nearly 30% since Jan 23. That is when China, the second-largest global palm consumer, enacted the world’s first coronavirus related lockdown. Palm oil demand typically increases in the two months before Ramadan, set to begin on April 23 this year and end with Eid al-Fitr (Hari Raya Aidilfitri) on May 23. Importers usually stock up on the edible oil in anticipation of increased food consumption as families and friends meet in communal feasts to break their daily fasts. With people under lockdown unable to gather as normal this year and with many restaurants, canteens and hotels shut iftar, or breakfast meals, are expected to be small scale affairs. Purchases from top Ramadan buyers India, Bangladesh, Pakistan, Saudi Arabia and Iran picked up in early March, but have slumped since then as governments enacted lockdown measures, traders and analysts said. “We have lost that window for Ramadan demand to pick up, we should have seen a lot higher shipments to the Middle East in the beginning of March,” said Sathia Varqa, owner of Singapore based Palm Oil Analytics. March palm oil exports from Malaysia, the world’s second-largest producer, fell 27% from the same month a year earlier to 1,181,422 tonnes, the lowest monthly volume since at least 2016, according to Malaysian Palm Oil Board data. Top producer Indonesia’s March exports were higher than in February but fell 3% from a year earlier to 1,885,153 tonnes, according to Refinitiv data. “Middle East buyers are under lockdown, so it is difficult to see a seasonal peak,” Varqa said. In India, the world’s biggest edible oil consumer, the hotel, restaurant and catering industry is a major user of palm oil, but demand from this sector has fallen as much as 40% due to a nationwide lockdown, according to an analysis published by the Malaysian Palm Oil Council (MPOC). Indian palm oil demand usually jumps around 10% during festivals such as Ramadan, but this year such an increase is unlikely, said Sudhakar Desai, president of Indian Vegetable Oil Producers’ Association (IVPA). “For the first time this year we will see a fall in per capita consumption,” Desai said. The country’s imports in March plunged 58% from a year earlier to 335,308 tonnes, according to data compiled by Mumbai-based industry body the Solvent Extractors’ Association. In April, India’s palm oil imports could plunge to 450,000 tonnes from 707,450 tonnes a year ago, IVPA’s Desai said. Pakistan’s palm oil imports in March were 40,000–50,000 tonnes lower than industry expectations, while trading in Bangladesh’s local market has been slow since mid-March, according to MPOC analysis. “Purchasing power is falling. People are losing jobs or witnessing pay cuts. This will have an impact on palm consumption,” said a Mumbai-based dealer with a global trading firm.

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Palm Oil Today Indonesia

Komersialisasi MPOB untuk Teknologi Minyak Kelapa Sawit Mencapai 3 Milyar Ringgit Malaysia

Malaysian Palm Oil Board (MPOB) mengatakan pada sector hulu, teknologi dan penemuan ditujukan untuk meningkatkan hasil minyak kelapa sawit.. — foto AFP


ekitar 30.4 persen dari teknologi minyak kelapa sawit Malaysia telah dikomersialisasi dengan nilai pasar sebesar 3 miliar Ringgit Malaysia, memberikan keuntungan pada industri dalam semua sector. Malaysian Palm Oil Board (MPOB) mengatakan pada sector hulu, teknologi dan penemuan ditujukan untuk meningkatkan hasil minyak kelapa sawit. Ini termasuk tanaman menguntungkan dan formulasi pengasapan untuk pengendalian larva ngengat dan menghancurkan jamur utuk mempercepat proses biodegradasi akar pohon kelapa sawit, serta menyediakan pupuk hayati untuk perawatan dan pengendalian penyakit pada pohon kelapa sawit. “MPOB dapat bangga dengan terobosan inovasi teknologinya ketika berhasil menemukan dan meluncurkan 667 teknologi yang mencakup semua sektor di industri minyak kelapa sawit selama 20 tahun terakhir,” kata direktur jenderal MPOB Ahmad Parveez Ghulam Kadir dalam sebuat pernyataan yang dikeluarkan bersamaan dengan perayaan ulang tahun ke 20 dewan direksi dalam memberikan solusi terobosan. Didirikan pada tanggal 1 Mei 2020, melalui penggabungan Palm Oil Research Institute of Malaysia (PORIM) dan Palm Oil Registration and Licensing Authority (PORLA), MPOB telah mencapai keberhasilan yang tidak terhitung dalam perjalanan 20 tahunnya untuk menjadi otoritas di industri minyak kelapa sawit. Penemuan mekanisasi oleh MPOB dan adaptasinya dalam operasi perkebunan untuk memanen, mengumpulkan buah-buah dan transportasi di lading telah meningkatkan produktivitas pekerja dan efisiensi manajemen perkebunan. Sementara itu, kemajuan dalam penelitian pemuliaan dan bioteknologi telah mengembangkan bahan-bahan penanaman pohon kelapa sawit, yang dinamai seri PS1 hingga PS13 melalui koleksi induk-induk pohon kelapa sawit yang beragam. Mereka memiliki karakteristik yang berbeda seperti hasil yang tinggi, kekerdilan, tankai yang panjang dan kaya akan Vitamin E tocotrienol. Solusi terobosan yang lain adalah program genom yang meningkatkan hasil panen melalui pemilihan bahan-bahan tanaman yang mampu menghasilkan lebih banyak, dan juga mengurangi kontaminasi oleh bahan tanaman berproduksi rendah dari biji tanaman berkecambah dan biji pohon kelapa sawit. Teknik bioteknologi seperti kultur jaringan, metode penyaringan molekul, dan juga memungkinkan teknologi yang mencakup pengurutan, pemilihan genom dan bahkan rekayasa genetika yang memungkinkan peningkatan produksi secara teoritis yaitu sebesar 18 ton per hektar per tahun. MPOB telah mencapai prestasi yang signifikan ketika ia menjadi organisasi pertama yang yang membuat urutan wilayah kelapa sawit berdasarkan kekayaan genetic pada tahun 2005. Terobosan tersebut adalah katalis pertama yang akhirnya digunakan untuk membuat urutan genom kelapa sawit, yang dilakukan pada tahun 2009. “Hal ini memungkinkan pengidentifikasian genetik yang mempengaruhi sifat agronomi di kelapa sawit. Konversi dari penemuan-penemuan tersebut menjadi tes diagnostik molekul yang membantu meningkatkan efisiensi pembibitan kelapa sawit,” tambah Ahmad.


Organization News MPOB Commercialisation of Palm Oil Technologies Hits RM3b About 30.4 per cent of the Malaysian palm oil technologies has so far been commercialised with a market value of RM3 billion, benefiting the industry in all sectors. The Malaysian Palm Oil Board (MPOB) said in the upstream sector, technologies and inventions are aimed at improving oil palm yields further. These include beneficial plants and fogging formulation for bagworm control and rotting fungi to accelerate biodegradation of oil palm trunks, as well as bio-fertilisers for treatment in controlling the diseases of oil palm. “The MPOB can be proud of its technological innovation breakthroughs when it successfully invented and launched 667 technologies encompassing all sectors in the oil palm industry over the past 20 years,” MPOB director-general Ahmad Parveez Ghulam Kadir said in a statement in conjunction with the board’s 20th anniversary celebration in delivering breakthrough solutions. Established on May 1, 2000 through the merger of the Palm Oil Research Institute of Malaysia (PORIM) and the Palm Oil Registration and Licensing Authority (PORLA), the MPOB has achieved innumerable successes throughout its 20-year journey to become an authority in the oil palm industry. The MPOB’s invention of mechanisation and its adoption in the plantation operations for harvesting, collecting loose fruit and in-field transportation have improved worker productivity and plantation management efficiency. Meanwhile, advances in breeding and biotechnology research have developed oil palm planting materials, namely the PS1 to PS13 series through its vast collection of mother palms. They possess different traits such as high yield, dwarf, long stalk and richness in Vitamin E tocotrienol. Another breakthrough solution is its genome programme which can increase yields through the early selection of high yielding planting materials, as well as reducing the contamination of lower-yielding planting materials of germinated seeds and oil palm seedlings. Biotechnology techniques such as tissue culture, molecular screening methods, as well as enabling technologies which include sequencing, genomics selection and even genetic engineering enable the increase of production towards oil palm’s theoretical yield of 18 tonnes per hectare per year. The MPOB made another significant achievement when it became the first organisation to sequence gene-rich region of oil palm in 2005. The breakthrough was the first catalyst to eventually sequence the oil palm genome, which led to its decoding in 2009. “This allows the identification of genes influencing important agronomic traits in oil palm. Conversion of these discoveries into molecular diagnostic assays will help improve the efficiency of oil palm breeding,” added Ahmad.


Palm Oil Today Indonesia

Badan Usaha Milik Negara Indonesia, PT Pertamina Meminta Agar Parlemen Membatasi Harga Minyak Kelapa Sawit Mentah (CPO), Karena Perusahaan Tersebut Sedang Mengembangkan Kilang Untuk Membuat Bahan Bakar Dari Minyak Nabati.


ertamina perlu jaminan dari sisi pasokan dan harga minyak kelapa sawit yang akan digunakan sebagai bahan dasar untuk setidaknya tiga kilang yang diinvestasikannya, kata presiden direktur Nicke Widyawati kepada komite parlemen pada hari Selasa. Presiden Joko Widodo ingin Indonesia menggunakan bahan bakar yang terbuat dari minyak kelapa sawit sebagai langkah pengurangan impor bahan bakar yang mahal, yang juga merupakan kontributor utama defisit yang berkelanjutan. Widyawati mengatakan kepada parlemen bahwa Pertamina menginginkan peraturan dengan sebutan “kewajiban pasar domestik” (DMO) mengwajibkan sebagian hasil perkebunan CPO untuk dijual dalam negeri dengan harga yang dibatasi. Pertamina juga telah menyampaikan permintaanya tersebut secara tertulis kepada pemerintah. Pertamina sedang mengubah kilangnya agar bisa mengolah minyak kelapa sawit menjadi bahan bakar serta menambah unit baru untuk memenuhi target pemerintah. Salah satu fasilitas yang akan dibangun akan menelan biaya 600 juta Dolar Amerika. “Ketika ini menjadi program nasional, harus ada kebijakan untuk memastikan harga dan volume,” kata Widyawati. Harga kelapa sawit melonjak pada tahun lalu, ketika Indonesia, sebagai eksportir terbesar minyak nabati, mengatakan kalau Ia akan memperluas program wajib biodiesel. Indonesia mulai menggunakan biodiesel dengan 30% biokontennya terbuat dari kelapa sawit pada tahun 2019, yaitu kenaikan dari 20% ada tahun sebelumnya. Pada bulan Januari, konsumsi bahan bakar yang terbuat dari kelapa sawit 35% lebih tinggi daripada konsumsi rata-rata bulanan pada tahun lalu dikarenakan adanya program B30, seperti yang ditunjukkan oleh data pemerintah pada hari Selasa. Sugend Suparwoto dan Maman Abdurrahman, anggota parlemen, mengatakan bahwa mereka mendukung proposal DMO untuk menghindari kekurangan pasokan. Seorang menteri senior telah memperingatkan bahwa Indonesia mungkin tidak akan memiliki persediaan CPO yang cukup untuk melampaui 50% bio-konten jika program penanaman kembali terhambat. Sahat Sinaga, ketua direksi grup bahan bakar bio Indonesia Bio-Hydrocarbon Society, mengatakan kalau pemerintah harus mulai memikirkan untuk menanam berbagai tanaman lain untuk dijadikan bahan dasar bahan bakar bio di masa depan, mengingat adanya penundaan perkebunan kelapa sawit yang baru. “Kami telah menyarankan agar pemerintah tidak bergantung kepada kelapa sawit saja. Karena ada permintaan yang besar untuk minyak kelapa sawit sebagai bahan makanan,” kata Sinaga kepada Reuters, seraya menambahkan ada empat tanaman yang bisa dijadikan sebagai bahan pengganti. Jika Indonesia tidak mulai menghasilkan bahan dasar yang baru untuk bahan bakar bio, Sinaga mengestimasikan 75% dari produksi kelapa sawitnya akan digunakan di dalam negeri untuk lima tahun ke depan, meningkat sekitar 30% dari angka saat ini.

Indonesia State Energy Company PT Pertamina Asked Parliament To Cap Prices For Some Crude Palm Oil (CPO), As The Company Develops Refineries To Make Fuel From The Vegetable Oil. Pertamina needs a guarantee on the supply and price of palm oil as feed stock for at least three refineries it is investing in, chief executive officer Nicke Widyawati told a parliamentary committee on Tuesday. President Joko Widodo wants Indonesia to use fuel made from palm oil as he seeks to cut imports of costly fuel, a big contributor to Indonesia’s persistent current account deficits. Widyawati told parliament Pertamina wanted so called “domestic market obligation” (DMO) rules to require a mandatory portion of planters’ output of CPO to be sold domestically at a capped price. Pertamina has also written to the government about its request. Pertamina is converting its refineries to be able to process palm oil into fuel as well as adding a new unit to meet government targets. One of the facilities will cost $600 million to develop.“When it is a national programme, there should be a measure to guarantee price and volume,” Widyawati said. Prices of palm surged last year when Indonesia, the world’s top exporter of the vegetable oil, said it would expand the mandatory biodiesel programme. Indonesia started using biodiesel with 30% bio-content made from palm in late 2019, up from 20% previously. In January, consumption of the palm-based fuel was around 35% higher than the average monthly consumption last year due to the B30 programme, government data showed on Tuesday. Sugend Suparwoto and Maman Abdurrahman, members of parliament, said they supported the DMO proposal to avoid supply shortage. A senior minister has warned that Indonesia may not have enough supplies of CPO to go beyond 50% bio-content if a replanting programme stalls. Sahat Sinaga, chairman of biofuel group Indonesia Bio-Hydrocarbon Society, said the government should start thinking of planting different crops for future feed stocks of biofuel, especially given there is a moratorium on new palm plantations. “We have advised the government not to rely on palm alone. There is a big demand for palm oil as food ingredients,” Sinaga told Reuters, adding there were four crops that could be used as a replacement. If Indonesia does not produce new feed stock for biofuel, Sinaga estimated 75% of its palm output will be used domestically within five years, up from around 30% currently.



Palm Oil Today Indonesia

India Merubah Peraturan Untuk Impor Minyak Kelapa Sawit Murni India Modifies Rules For Refined Palm Oil Imports


ndia pada hari Senin menyatakan bahwa impor minyak kelapa sawit murni akan dapat dimulai kembali setelah pembatasan yang dilakukan pada bulan Januari, meskipun dengan syarat-syarat tertentu. Importir minyak kelapa sawit terbesar menyatakan pada hari Senin dalam sebuah pernyataan bahwa para importir perlu terlebih dahulu menyediakan perjanjian pra-pembelian dan mengimpor komoditas tersebut dalam jangka waktu enam bulan sejak diterimanya lisensi, bukan 18 bulan yang ada di peraturan sebelumnya. Perubahan ini akan meningkatkan impor minyak kelapa sawit murni pada bulan-bulan mendatang, kata seorang pemilik kilang yang berbasis di Mumbai. “Pemerintah mungkin khawatir akan pasokan terkait penguncian akses keluar masuk (coronavirus),” sahut pemilik kilang. Minyak kelapa sawit menyumbang hampir dua pertiga dari total impor minyak nabati India. India membeli lebih dari 9 juta ton minyak kelapa sawit dalam satu tahun, terutama dari Indonesia dan Malaysia. Indonesia merupakan produsen minyak kelapa sawit terbesar di dunia, diikuti oleh Malaysia.


India on Monday said imports of refined palm oil could recommence after being restricted in January, although with conditions attached. The world’s biggest importer of palm oil on Monday said in a statement that importers would need to furnish pre-purchase agreements and import the commodity within six months of receiving the licence, instead of 18 months previously. The change could increase imports of refined palm oil in coming months, said a Mumbai-based refiner. “The government might be worried about supplies due to the (coronavirus) lockdown,” the refiner said. Palm oil accounts for nearly two-thirds of India’s total edible oil imports. India buys more than 9 million tonnes of palm oil annually, mainly from Indonesia and Malaysia. Indonesia is the world’s biggest producer of palm oil, followed by Malaysia.

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etahun setelah peresmiannya pada bulan Desember 2018, pabrik penyulingan dan pengemasan minyak kelapa sawit Golden Africa yang menghadap ke pelabuhan multimodal Doraleh telah meningkatkan kecepatannya. Dan truktruk yang mengarah ke Ethiopia akan segera diberangkatkan, penuh dengan muatan. Lebih dari 30 juta Dolar Amerika telah diinvestasikan pada pabrik penyulingan terbesar di Djibouti. Dengan 500 karyawan, ia akan dapat menghasilkan 8.000 hingga 9.000 ton minyak nabati setiap bulan. Perusahaan yang dipimpin oleh Yemeni Fouad Hayel Saeed, yang juga merupakan konsul kehormatan Djibouti di Malaysia, memiliki pipa sepanjang 3,4 km yang terhubung pada terminalnya sendiri, dimana kapal-kapal dari Malaysia dan Indonesia (produsen dari 85 % minyak kelapa sawit dunia) berlabuh. Dalam waktu satu tahun sejak pembukaannya, perusahaan tersebut telah memperoleh hampir seperlima dari pangsa pasar minyak kelapa sawit di Ethiopia. Tidak diragukan lagi, hubungan sang konsul dengan komunitas yang berpengaruh di Yemen memfasilitasi pendirian Golden Africa di Djibouti. Anak perusahaan dari pedagang asal Malaysia Pacific Inter-Link, menginvestasikan 5 juta Dolar Amerika untuk memperoleh mesin baru yang meningkatkan produksinya menjadi 13,500 ton minyak per bulan. Ia juga berencana mendirikan pabrik sabun.


Djibouti, di sisi lain, bermaksud menjadi pusat produksi dan pemrosesan di daerah Tanduk Afrika. “Pabrik kami adalah yang terbesar di negeri ini, namun termasuk kecil jika dilihat dari sudut pandang potensi kawasan ini,� sahut Adnan Hantosh, wakil direktur perusahaan yang merupakan cabang di Djibouti dari Hayel Saeed Aman (HSA), keluarga konglomerat yang memiliki usaha-usaha di daerah Asia Tenggara. Dengan lebih dari 35,000 karyawan dan peredaran bruto bernilai milyaran Dolar Amerika, grup tersebut merupakan salah satu produsen dan penyuling minyak kelapa sawit terkemuka di dunia. Dengan target bulanan 21,000 ton minyak per bulan pada pertengahan tahun, tetap tidak cukup untuk memenuhi permintaan Ethiopia sebesar 50,000 ton per bulan dan sekitar 6,000 dan 8,000 ton di Somalia dan Eritrea. Namun nilai tersebut sudah cukup untuk mendapatkan pangsa pasar 109 juta penduduk yang hanya mengkonsumsi 5.46 kg minyak kelapa sawit per orang (dibandingkan dengan rata-rata global 25 kg per orang) dan dimana angka impor dari Malaysia meningkat dari 76,000 ton di tahun 2014 menjadi 149,000 ton di tahun 2017. Ethiopia, tentu saja merupakan target utama pedagang minyak kelapa sawit dari Malaysia dalam rangka mecari pangsa pasar baru. India selaku pelanggan terbesarnya,


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PALM OIL: GOLDEN AFRICA THINKS BIG IN EAST AFRICA One year after its inauguration in December 2018, overlooking the multimodal port of Doraleh, Golden Africa’s palm oil refining and packaging plant has already picked up speed. And trucks, destined for Ethiopia, will soon be on their way, fully loaded. More than $30m was invested in the refinery, the largest in Djibouti. With 500 employees, it will be able to process between 8,000 and 9,000tn of vegetable oil each month. The company, headed by the Yemeni Fouad Hayel Saeed, Djibouti’s honorary consul in Malaysia, has a 3.4 km pipeline to its own terminal, where ships from Malaysia and Indonesia (producing 85% of the world’s palm oil) dock. Within a year of opening, the company had captured almost a fifth of the palm oil market share in Ethiopia. Undoubtedly, the consul’s links with the influential Yemeni community facilitated the establishment of Golden Africa in Djibouti. A subsidiary of the Malaysian trader Pacific Inter-Link, it is investing $5m in new machinery to raise production to 13,500tn of oil per month. It also has plans to build a soap factory. Djibouti, on the other hand, intends to become a production and processing hub for the Horn of Africa. “Our factory is the largest in the country, but it is small in relation to the region’s potential,” said Adnan Hantosh, deputy managing director of what is also the Djibouti branch of a very powerful family conglomerate with a presence throughout South-East Asia, Hayel Saeed Aman (HSA). With 35,000 employees and several billion dollars in turnover, the group is one of the world’s leading producers and refiners of palm oil. The monthly target of 21,000tn of oil in the medium term, however, is still insufficient to meet Ethiopian demand of 50,000tn per month and between 6,000 and 8,000tn in Somalia and Eritrea. But it is enough to gain a foothold in a market of 109 million people who consume only 5.46kg of palm oil per person (compared to a world average of 25kg) and where imports from Malaysia rose from 76,000tn in 2014 to 149,000tn in 2017. Ethiopia, obviously, is thus a prime target for Malaysian palm oil as it seeks new markets. India, a major customer, suspended imports after statements from Kuala Lumpur about Kashmir. In addition, anti-palm oil campaigns are intensifying around the world. While 90% of the palm oil sold in Ethiopia is imported, the region’s only refinery offers an important advantage. Addis Ababa is spending $500m a year on imports, against a backdrop of foreign-exchange shortages.“By importing from Djibouti, there is no foreign-exchange problem. Since HSA controls the entire chain, it controls prices and can be more competitive,” said one analyst. The Ethiopian authorities, looking to stimulate local production, estimate that refining on the spot could save $80m a year. Already active in Kenya, Golden Africa, which already operates in Kenya, is also considering a facility in Ethiopia. This is attracting other investors: last December, Saudi-Ethiopian billionaire Mohamed Al Amoudi laid the foundation stone of a refinery to process other edible oils, including soya, sunflower and peanut.

telah menangguhkan impor setelah pernyataan yang dikeluarkan dari Kuala Lumpur mengenai Kashmir. Selain itu, kampanye anti minyak kelapa sawit juga semakin meningkat di dunia. Sementara 90% dari minyak kelapa sawit yang dijual di Ethiopia merupakan hasil impor, satu-satunya kilang yang berada di kawasan tersebut menawarkan keunggulan penting. Addis Ababa mengeluarkan biaya 500 juta Dolar Amerika atas impor setahun, dalam kondisi kekurangan valuta asing. “Dengan mengimpor dari Djibouti, tidak akan ada masalah pertukaran valuta asing. Dikarenakan juga HSA menguasai keseluruhan rantai pasokan, ia dapat mengatur harga dan bisa lebih kompetitif,” kata salah satu analis. Pemerintah Ethiopia mencari cara untuk merangsang produksi domestik, dan memperkirakan penyulingan di tempat dapat menghemat sebanyak 80 juta Dolar Amerika dalam satu tahun. Golden Africa, yang telah aktif dan beroperasi di Kenya, sedang mempertimbangkan pembangunan fasilitas di Ethiopia. Hal ini menarik investor-investor lain: pada bulan Desember yang lalu, miliarder Saudi-Ethiopia Mohamed Al Amoudi meletakkan batu pertama untuk sebuah kilang penyulingan yang dibangun untuk memproses minyak nabati yang lain, termasuk dari bahan kedelai, bunga matahari dan kacang tanah.



Palm Oil Today Indonesia




inyak kelapa sawit (berasal dari tanaman kelapa sawit Afrika, Elaeis guineensis) dapat ditelesuri keberadaannya hingga lebih dari 5000 tahun yang lalu. Minyak kelapa sawit telah lama diketahui oleh negara-negara yang berada di Afrika Barat. Digunakan secara luas oleh penduduk Afrika Barat sebagai minyak goreng. Pada abad ke tujuh belas, pedagang-pedagang asal Eropa yang berdagang di Afrika Barat terkadang juga membeli minyak kelapa sawit untuk digunakan di Eropa, namun dikarenakan massanya yang besar dan harganya yang murah, serta karena keuntungan yang lebih besar didapatkan dari perdagangan budak, maka minyak kelapa sawit masih sangat langka di luar Afrika Barat. Pada permulaan abad ke sembilan belas, penurunan perdagangan budak di daerah Atlantik dan permintaan Eropa untuk perdagangan yang sah (yaitu perdagangan barang-barang dan bukan nyawa manusia) mewajibkan negara-negara di Afrika untuk mencari sumber pendapatan perdagangan yang baru. Di Konfederasi Asante, budak-budak milik negara membangun perkebunan kelapa sawit yang sangat luas, sementara di Kerajaan Dahomey yang berdekatan, Raja Ghezo membuat hukum yang melarang rakyatnya untuk menebang pohon-pohon kelapa sawit. Minyak kelapa sawit menjadi komoditas yang paling dicari oleh pedagang-pedagang asal Inggris, minyak tersebut digunakan sebagai pelumas untuk mesin-mesin pada masa Revolusi Industri yang sedang berlangsung pada saat itu, dan juga digunakan sebagai dasar pembuatan berbagai merek sabun mandi seperti Palmolive. Pada tahun 1870, minyak kelapa sawit menjadi produk ekspor utama negara-negara di Afrika Barat seperti Ghana dan Nigeria. Pada tahun 1880-an, kakao menjadi produk yang lebih dicari, menyebabkan penurunan industri minyak kelapa sawit dan perdagangan dengan negara-negara tersebut. Pohon kelapa sawit, Elaeis guineensis bukan merupakan tanaman asli Malaysia. Minyak kelapa sawit pertama kali dikenalkan di Malaysia (pada saat itu disebut Malaya) pada tahun 1870 sebagai tanaman hias. Penggunaanya sebagai tanaman perkebunan dikembangkan pada tahun 1917 ketika perkebunan pertama didirikan. Perkebunan kelapa sawit secara mayoritas dioperasikan oleh pemilik lahan yang berasal dari Inggris. Sejak skema utama perkebunan kelapa sawit diperkenalkan oleh pemerintah pada tahun 1960-an untuk memberantas kemiskinan. Setiap pemukim dialokasikan 10 hektas lahan yang telah ditanami kelapa sawit ataupun karet, dan mereka diberikan waktu 20 tahun untuk melunasi harga lahan tersebut.



PALM OIL COMES FROM AFRICA Palm oil (from the African palm oil, Elaeis guineensis) can be traced back to more than 5000 years ago. Palm oil was long recognized in West African countries. It is used widely among West African peoples as cooking oil. In the seventeenth century European merchants trading with West Africa occasionally purchased palm oil for use in Europe, but as the oil was bulky and cheap, and due to the much higher profits available from slave-trading, palm oil remained rare outside West Africa. During the early nineteenth century, the decline of the Atlantic slave trade and Europe’s demand for legitimate commerce (trade in material goods rather than human lives) obliged African countries to seek new sources of trade revenue. In the Asante Confederacy, state-owned slaves built large plantations of palm oil trees, while in the neighboring Kingdom of Dahomey, King Ghezo passed a law in 1856 forbidding his subjects from cutting down palm oil trees. Palm oil became a highly sought-after commodity by British traders, the oil being used as industrial lubricant for the machines of Britain’s ongoing Industrial Revolution, as well as forming the basis for various brands of soap such as Palmolive. By 1870, palm oil constituted the primary export of some West African countries such as Ghana and Nigeria. By the 1880s, cocoa had become more highly sought-after, leading to the decline of the palm oil industry and trade within these countries. The palm oil, Elaeis guineensis is not native to Malaysia. Palm oil was first introduced to Malaysia (then Malaya) in 1870 as an ornamental plant. Its use as a crop was developed in 1917 when the first plantation was established. Then the palm oils plantation was mostly operated by English landowners. From the 1960’s major palm oil plantation scheme was introduced by the government mainly to eradicate poverty. Each settler was allocated 10 acres of land planted either with Palm oil or rubber, and they are given 20 years to pay off the land. Available Palm Oil Map for Countries À Palm Refinery - Olechemical and Biodiesel - Malaysia À Palm and Kernel Mill - Malaysia À Palm Oil Map - Thailand

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Palm Oil Today Indonesia

Exclusive Interviews with the Palm Oil Industry's Major Players Join us as we go on exclusive interviews with two major players in the palm oil from Malaysia. They candidly open up about their interview of this year's palm oil industry in malaysia what we can expect between now and 2021. No Crystal balls involved, just factual opinions, and some guidance helping us sail through these turbulent times. To read this interview in Bahasa Indonesia, please log on to the web :


ii) MPOB

Dr. Ahmad Parveez Ghulam Kadir, Director-General of Malaysian Palm Oil Board (MPOB)

Datuk Nageeb Wahab, Chief Executive of Malaysian Palm Oil Association (MPOA) Established in 1999 as a single umbrella entity to replace 3 large

Malaysian Palm Oil Board (MPOB), established on 1st May 2020, is a

plantation sector organizations, namely, the Rubber Growers Associa-

government agency responsible for the development of the oil palm

tion (RGA), the United Planting Association of Malaysia (UPAM), and th

industry in Malaysia. Functioning under the Ministry of Plantation

e Malaysian Oil Palm Growers Council (MOPGC).

Industries and Commodities, its main role is to promote and develop national objectives, policies, and priorities for the well-being of the

MPOA has been tasked with the important function of balancing the

Malaysian oil palm industry.

needs and interests of the various sectors for synergy and development of the plantation industry as a whole. Though a crop-specific

To drive the industry forward, MPOB focuses on research and develop-

body that will focus on oil palm, MPOA also serves the interest of other

ment along the entire value spectrum of the oil palm industry. It

plantation tree crops such as rubber, coconut, cocoa, sugar cane, etc.

embraces a 3-pronged strategy to maximize synergies between

It includes non-crop issues relating to labor, trade, pricing, and

economic development, environmental stewardship, and value

sustainability. As an integrated single, powerful voice, MPOA

addition to ensure that future growth is carried out within a sustainable

represents the complex need of the plantation industry more effective-

framework. MPOB engages in cutting-edge science and innovative

ly particularly now that the economy is being rapidly globalized.

technologies and over the years has won many awards, both local and international. It plays a pivotal role in promoting industry excellence

Today, MPOA has a membership comprising of 120 companies includ-

that resonates with its mission to enhance the well-being of the Malay-

ing all the big players in Malaysia with a combined planted hectares of

sian oil palm industry through research, development, and excellent

close to 2 million hectares or 40% of the planted oil palm area in Malaysia.


It is the single largest association representing the industry in Malaysia.




Palm Oil Today Indonesia

MPOB’s vision is to become the premier Nobel Laureateproducing

to operate could function without any hassle or delay. We also assist

research and development institution, providing leadership and

many supporting industry players to obtain operating approvals from

impetus for the development of a highly diversified, value-added,

the National Security Council via MITI to ensure oil palm industry

globally competitive and sustainable oil palm industry.

operations are not affected. Many enquiries from companies and associations were responded to clarify issues related to the MCO conditions and updates. During this period, MPOB issued many letters to inform all industry players through their respective associations on the allowance to operate as well as providing suitable SOPs to ensure they operate according to the SOPs issued by National Security Council, oil palm-related SOPs prepared by MPOB as well as by some plantation companies. A new letter with updated SOPs was issued

1. Thank you for taking the time to join us for this interview. Just to warm all of you up a little, so during this period where everyone is kept working from home, what is your daily routine like?

MPOA: Since the COVID-19 lockdown or what we called in Malaysia, Movement Control Order (MCO) effective 18th of March, the MPOA Secretariat were kept busy and played a pivotal role towards first, convincing and getting the government to allow the plantation sector to continue operating as well as ensuring all our members’ needs are taken care of by interfacing with the relevant authorities. As a result, the plantation sectors, except for one day in Malaysia and another 14 days in Sabah, have been spared the agony of closing and ceasing operation. We would not want to imagine if this industry namely the oil palm sector were to be asked to shut down like the rest of the other industries since we are dealing with a perishable commodity that if left unharvested and to rot will cause irreparable damage and have a significant impact and effect, especially on the 1 million smallholders in this country whose livelihood depends on it. Members in gratitude and response to the fight against the pandemic contributed more than RM5 million in the form of medical equipment and tool kits to the government hospitals and institutions. MPOB: The Movement Control Order (MCO) announced by the government starting from 18th March 2020 required all to stay at home and adopt a new norm. The majority of MPOB staff worked from home since then to ensure MPOB’s functions and services to the industry are not interrupted during the lockdown. Personally as the Director-General of MPOB, most of the time I perform my duties from home and occasionally went to MPOB for things that require me to physically be there. Some activities were performed via video conferencing. During the early days of MCO, I was busy assisting the industry members to ensure their supporting industries or service providers could operate to ensure all the sectors under the oil palm industry which are allowed

everytime the government extended the MCO and when it changed from MCO to CMCO and then to RMCO. MPOB has also issued letters to related industry players (growers, mills, and refineries) for them to carry when they perform their duties which require them to move from one place to another during the MCO. The letter was also shared on MPOB’s social media as well as on the website. MPOB constantly updates the stakeholders with the latest information on the implementation of the MCO related to the oil palm sector through social media platforms, hotlines and websites. The oil palm industry is among the essential economic sectors which have been granted by the government to continue operations along the production chains during the MCO. These include the harvesting of Fresh Fruit Bunches (FFB) by plantations and smallholders; the processing of FFB by palm oil mills and the processing of crude palm oil in refineries for the production of cooking oil for local markets. However, all parties involved in the operations have to take precautionary measures to stop the spread of COVID-19. These include minimizing labor and their mobility to avoid physical contact (social distancing) and workers should return home immediately after work. They are also reminded to take care of their hygiene by washing sanitizing their hands.



Palm Oil Today Indonesia undertaken to address these challenges are: the government, under the National Short Term Economic Recovery Plan (PENJANA) has announced a 100% exemption on export duty on crude palm oil, crude palm kernel oil, and processed palm kernel oil from July 1, 2020, to December 31, 2020, to boost the palm oil sector. The move will encourage industry players to sell more palm oil and help them earn more income while solving their problems, including the additional costs incurred during these difficult times. We could promote more exports, especially to the top vegetable oil markets, including India, China, and Pakistan. This tax exemption also augurs well with India’s decision to import 1.14 million tonnes of vegetable oil in June from the April-May monthly average of 865,000 million tonnes. Unofficial reports show that export in June has increased by around 20% as compared to May 2020. To ensure the Malaysian oil palm industry remains competitive in

2. What are some of the challenges that you feel the palm oil industry is facing during this period of uncertainty? What are some of the measures taken to address these challenges?

the global market, MPOB as the government agency entrusted to serve the country’s oil palm industry has undertaken several strategies and plans to conquer the detrimental effect of the pandemic, which amongst others include: • Differentiate Malaysian palm oil with other edible oils through the preservation of the valuable phytonutrients contained within palm oil.

MPOA: The plantation sector in Malaysia is already facing a myriad of issues namely labor shortages, the ever increasing cost of production as well as reputational and sustainability issues. During this period of uncertainty, these issues continue to beset the industry but what is of more concern is the drastic drop in demand as a result of the closure of most things globally. This led to an increase in stockpile resulting in bearish prices just like most commodities. This commodity being a price taker is subjected to price volatility and this is our biggest challenge and that shall continue. Another big challenge was ensuring that the workforce which consists of 85% of foreign workers are kept intact and does not leave. We are rather fortunate that the existing workers stayed on but the industry has not got any new or additional workers to complement the already reduced work strength since the

In particular, the beta carotenes and vitamin E tocotrienols, and their applications in isolated form in food products. • Commercialization on high value-added products such as palm-based designer fats and nutraceutical supplements that are being developed for various food applications and functionalities. • Focus on research to produce more downstream products than basic oleochemicals. • Provide a one-stop centre such as pilot plant facilities and international quality analyses and quality labs to help small and medium-sized enterprises (SMEs) and industries which are interested in investing in downstream palm products. • Provide technical advisory services to ensure the technologies transferred to SMEs or industries are successfully commercialised.

onset of the lockdown. Another fear is that these workers that remained will be wanting to go back to their families once the lockdown is over. MPOB: The implementation of the MCO brings uncertainty to the economic sectors, including the oil palm industry. During that time, our primary concerns were how severe the lockdown would affect the operations, particularly the harvesting and processing of FFB, and losses to the producers and smallholders. The Ministry of Plantation Industries and Commodities has swiftly highlighted the issue to the government and justified the importance of the oil palm sector to continue its operations to ensure the supply of cooking oil for domestic consumption and fulfill the overseas contracts after the MCO. The Security Council has allowed the oil palm industry to resume operations on the second day of the MCO. The COVID-19 pandemic harms the global trade due to the restriction of movement, and hence, has also affected the supply and uses of palm oil in the importing countries. During the MCO, the crude palm oil (CPO) prices have been affected at the early stage, starting early April 2020 the CPO price was declining due to the uncertainties of the COVID-19 and the MCO in many parts of the world which affected global palm oil demand. However, since mid-May 2020, due to several positive sentiments, the price was seen to be improving and stabilizing until today. The global pandemic has also highlighted an issue which probably Malaysians were not aware of, and that is food security or self-sufficiency in food production. Among the measures



Palm Oil Today Indonesia of a lot of sectors, the oil palm industry stays above water and can withstand the economic onslaught. Prices of palm oil dipped not only because of lack of demand but were also dragged by other reasons such as a crash in crude oil prices, which is always coupled with palm oil due to the biodiesel factor. MPOB: The current pandemic does not cause a severe longterm effect on the oil palm industry as its operations are back to normal. However, like any other sector of the economy, the disruption in the production and operation along the whole supply chain will have repercussions on the economy. The Malaysian oil palm industry is export-oriented with exports of palm oil alone covering 93.0% of the total CPO production in 2019. Thus, the Malaysian palm oil industry is very dependent on exports. The pandemic has affected the export of Malaysian palm oil

3. Airlines and tourism-oriented industries are cutting manpower with massive slashes on revenue, do you reckon the palm oil industry would be forced to take such drastic measures and how detrimental would it be on the bottom lines?

to major destinations. Although exports of palm oil were affected at the early stage of the pandemic, however, lately the export seems to be picking up. We hope that with more countries slowly lifting their MCOs, the demand for palm oil will increase both locally and globally. Malaysia also anticipates lower than expected palm oil production this year. The pandemic also affects the implementation of biodiesel B20 as well as biodiesel market. The implementation was affected due to the MCO

MPOA: The commodities sectors, unlike the other sectors namely the tourism-related industries, were not badly hit during the MCO. Being essentially a food producer, this sector was spared and allowed to operate. While demand may have shrunk, we believe it is temporary as people need food to live, and as such demand will always be there albeit at a fluctuated level. This sector has not retrenched nor cut salaries of employees so far and that is proof of the resilience of this sector. Profits may have dipped but they can survive. In fact, with the

where it has to be delayed because of the movement restrictions especially for the launches in Sarawak and Sabah. Furthermore, the MCO has resulted in lesser usage of biodiesel due to fewer diesel transports on the road. This happens not only in Malaysia but around the globe.We anticipate the demand for biodiesel will be affected in 6-18 months until the pandemic is fully controlled globally. The delay in the launches of B20 and the reduction of biodiesel usage due to the MCO may affect the final annual palm oil stock.

gradual easing of lockdown in most countries, we are seeing demand picking up and prices easing up gradually. MPOB: The oil palm industry operations were not severely affected by the global pandemic as experienced by the services sector. The whole production sector was not interrupted since the implementation of the MCO. In fact, the oil palm industry is actually facing a serious labour shortage as recently reported by Malaysian Palm Oil Association (MPOA).

4. What are the long-term effects that you foresee with the current pandemic on the industry? MPOA: I believe this pandemic shall stay for a long period until a vaccine is found and that we have to adjust and live with the new norm. The fact that even during the pandemic, which has led to the closure



Palm Oil Today Indonesia 6. Equipment suppliers to the palm oil industry and those in the supply chain would be affected during this period, how do you think they can maintain their business in such a challenging climate? What other extraordinary efforts should be made?

5. With so much negativity floating and sinking in all industries, perhaps you could shed a bit of light from your perspective on what are the positive things the palm oil industry can look forward to in the next six months?

MPOA: We do experience some hiccups due to lack of supplies of equipment during the lockdown period but the situation is not critical as the supply chain within the country remains unscathed, and this industry due to its long existence has developed its manufacturing capabilities to manage its needs. As long as the industry is allowed to operate so will be the equipment suppliers. We are rather fortunate that we do not have to rely on imports to operate. MPOB: During the period of the MCO, supply of equipment for all sectors were affected due to logistic issues and other factors. The situation has now improved as economic sectors are now allowed to resume operations as the pandemic subsides.

MPOA: As I mentioned earlier, palm oil being essentially a food producer shall always command demand and will stay afloat for a long period. A point to note is that the palm oil price is still higher than last year despite this pandemic. That speaks volumes of its resilience. We are more concerned if the government stopped us from operating due to non-adherence of SOPs and guidelines rather than due to demand. The gradual opening of most sectors of the economy over the next six months shall continue to spur demand and prices. The question is the speed of the resumption to normalcy. We are comforted that prices of late have been on the increase after the gradual opening of the economy in most countries and that augurs well for the oil palm sector for the near future. MPOB: We are looking at a rebound in the price of CPO in the second half of 2020 supported by the anticipated recovery in export demand from major importing countries such as China and the EU due to the gradual easing of lockdowns coupled with the expectation for improvement in exports to India. We also anticipate that in the fourth quarter of 2020, inventory levels would improve due to the increase in export volume which we hope could further support the improvement in prices. Malaysia has begun to see a rebound in CPO prices since May this year. On June 24, the price of CPO stood at RM2, 515 per tonne. On this note, we are anticipating that the average CPO price for 2020 would be around RM2, 500 per tonne. The performance of world oils and fats market is expected to be mixed, with total production and exports are forecast to be lower than that of the previous year. However, total disappearance is expected to increase which will lead to lower stocks and better prices.


With the labour shortage since prior to COVID-19, we hope some of the plantation companies or even smallholders may consider moving towards mechanization in the fields and operations. The use of machines will also help to keep good social distancing in their plantations, mills and refineries. Manually, more labour will be required. MPOB hopes the demand for mechanization and plantation equipment would help boost the economy of the machineries or equipment suppliers. The procurement of equipment in the oil palm industry, like any other industry is the company’s decision which is part of the investment to enhance production and expand its operations. The government is not interfering as it is a business decision.interfering as it is a business decision.


Palm Oil Today Indonesia

7. What is your advice to palm oil producers who are feeling the slump now? What additional measures they should be taking during this period? MPOA: The oil palm sector is not facing a slump but more a glitch and as long as there is demand and prices are reasonable, they will remain relevant. This industry, which contributes about 5% to the country’s GDP is a mature one and has survived plenty of challenges over the years and I believe they will be able to withstand these uncertainties. A bit of tightening of the belt and adapting to the new norms is what is required of the industry player. Another important factor is the presence of government support in terms of regulatory assistance such as easing of the labor recruitment process as well as financial handouts namely to the smallholders in keeping all afloat. 3 million people livelihood depends directly or indirectly on this sector. That is how important palm oil is to the nation. MPOB: All sectors in the oil palm industry must focus on enhancing productivity and quality of palm oil products to sustain income regardless of the palm oil prices. This can be attained through efficient management and good practices in the plantations, milling and processing, and intensifying activities in the downstream value added sector. MPOB through our research and development (R&D) efforts has developed many new technologies and innovations encompassing all the sectors in the oil palm industry for adoption which in turn will elevate productivity, efficiency and returns. In fact, on 7th July 2020, MPOB organised its annual Seminar Transfer of Technology Seminar (ToT 2020) at MPOB’s headquarters through web or Webinar in order to comply with COVID-19 SOP. TOT 2020 is MPOB’s platform to introduce

few more new technologies from upstream to downstream to drive the oil palm industry forward. As of 2019, MPOB has launched 667 technologies, 184 services and has patented 367 innovations. In terms of technology commercialisation, MPOB has recorded achievement rates of 30.4%, while patented technology stood at 32.4%. At the TOT 2020, MPOB launched eight (8) new technologies and seven (7) services for commercialisation.


Menteri Industri Perkebunan dan Komoditas, CPOPC Membahas Masalah pada Industri Minyak Kelapa Sawit Negara


ementerian menyampaikan bahwa menterinya Datuk Dr Mohd Khairuddin Aman Razali menerima panggilan resmi direktur eksekutif CPOPC Tan Sri Dr Yusof Basiron. Kedua belah pihak membahas tentang komitmen dan tindakan Malaysia dalam memerangi isu-isu terkait dengan kampanye anti minyak kelapa sawit untuk melindungi kepentingan industri. "Yang juga turut dibahas adalah proposal untuk mengatasi masalah yang berkaitan dengan rendahnya harga minyak kelapa sawit mentah yang berdampak pada para pemangku kepentingan, terutama pemilik lading kecil, serta upaya meningkatkan kerja sama Malaysia dengan CPOPC,� sebut kementerian dalam sebuah pernyataan. CPOPC adalah organisasi yang beranggotakan negara-negara produsen minyak kelapa sawit yang didirikan oleh oleh Malaysia dan Indonesia pada tahun 2015 untuk memerangi isu-isu yang terkait dengan industri. Sebagai produsen terbesar dan nomor dua di dunia, Indonesia dan Malaysia bekerja dengan dasar yang sama untuk mengembangkan industri minyak kelapa sawit serta melindungi kepentingan industri di kedua negara. Kolombia and Ghana diharapkan dapat bergabung dengan CPOPC secara resmi dalam waktu dekat. Beberapa negara lain juga telah menyatakan minatnya untuk bergabung bersama CPOPC, yang pada saat ini sedang diketuai oleh Malaysia hingga 31 Desember 2020. Kementerian juga telah menyampaikan apresiasinya kepada sekretariat CPOPC dan berharap ia dapat menjadi jembatan yang mempererat hubungan antara Malaysia dan Indonesia.


International News Plantation Minister, CPOPC Discuss Issues on Country's Palm Oil Industry The Malaysian Ministry of Plantation Industries and Commodity held a meeting with the Council of Palm Oil Producing Countries (CPOPC) where they discussed various issues related to the palm oil industry. The ministry said its minister Datuk Dr Mohd Khairuddin Aman Razali received a courtesy call by the CPOPC's executive director Tan Sri Dr Yusof Basiron. Both sides touched on Malaysia's commitment and action in fighting issues related to the anti-palm oil campaign to safeguard the interests of the industry. "Also discussed were proposals to address issues related to low crude palm oil prices that had impacted stakeholders, especially smallholders, as well as efforts to enhance Malaysia's cooperation with the CPOPC," the ministry said in a statement. CPOPC is an organisation of oil palm producing countries which was established by Malaysia and Indonesia in 2015 to combat issues related to the industry. As the world's largest and second-largest producers, Indonesia and Malaysia are working to find common grounds in developing the palm oil industry as well as to safeguard the interest of the industry in both countries. Colombia and Ghana are expected to formally join the CPOPC in the near future. Several other countries have also expressed their interest in joining the CPOPC, which is currently chaired by Malaysia until Dec 31, 2020. The ministry has also expressed its appreciation to the CPOPC's secretariat and hoped it will become a bridge to build closer relations between Malaysia and Indonesia.


Palm Oil Today Indonesia

Laba Kuartal Pertama Genting Plantations Melonjak Lebih Dari Dua Kali Lipat Menjadi 91.3 Juta Ringgit Malaysia Karena Harga Kelapa Sawit yang Tinggi


arga jual kelapa sawit yang lebih tinggi mendorong laba bersih Genting Plantations Bhd pada kuartal pertama yang berakhir pada tanggal 31 Maret 2020 lebih tinggi dua kali lipat menjadi 91.3 juta Ringgit Malaysia, dibandingkan dengan 41.68 Ringgit Malaysia pada tahun sebelumnya. Dalam pengajuan dengan Bursa Malaysia, grup tersebut menyampaikan bahwa harga minyak kelapa sawit mentah (CPO) naik sepertiga menjadi 2,619 Ringgit Malaysia per metrik ton (mt) di kuartal pertama tahun 2020, dari 1,974 Ringgit Malaysia per metrik ton di tahun 2019, sementara harga jual biji kelapa sawit naik sebesar seperempat menjadi 1,593 Ringgit Malaysia dari 1,283 Ringgit Malaysia pada tahun sebelumnya. Laba per saham (EPS) pada kuartal pertama tahun 2020 naik menjadi 10.18 sen dari 5.16 sen. Namun pendapatan turun 8.47% menjadi 569.04 juta Ringgit Malaysia karena menurunnya permintaan untuk produk-produk kelapa sawit pada segmen manufaktur hilir. Grup tersebut mengatakan produksi tandan buah segar (FFB) 19% lebih rendah dari tahun ke tahun, sebagian besar disebabkan oleh efek tertunda dari kondisi cuaca yang buruk pada tahun 2019 di mana mempengaruhi hasil produksi perkebunan Malaysia. Penangguhan sementara operasionalnya di beberapa perkebunan selama perintah pengurangan pergerakan (MCO) juga mempengaruhi hasil produksi. Semantara operasional di Indonesia jgua mengalami efek tertunda akibat kondisi cuaca yang buruk, dampaknya dapat dikurangi dengan penambahan area panen dan profil umur tanaman yang lebih baik. Mengenai prospeknya, grup tersebut mengatakan bahwa ia akan melacak kinerja segmen perkebunan andalannya, di mana juga bergantung terutama pada pergerakan harga penjualan produk-produk kelapa sawitnya dan juga hasil produksi FFB dari grup. Sebagaimana COVID-19 terus mempengaruhi ekonomi secara global, grup tersebut memperkirakan harga minyak kelapa sawit akan terpengaruh oleh faktor-faktor akibat pandemi seperti dinamika permintaan dan pasokan minyak kelapa sawit dan juga minyak serta lemak pengganti lainnya, kondisi ekonomi global dan arahan implementasi biodiesel yang lebih diprioritaskan oleh Indonesia dan Malaysia. Dengan adanya penurunan produksi FFB yang signifikan dari tahun ke tahun pada kuartal pertama tahun ini, grup tersebut berharap dapat menutup defisit pada bulan-bulan berikutnya, didukung dengan penambahan area yang sudah siap panen dan profil usia tanaman yang lebih menguntungkan dari operasionalnya di Indonesia. Namun, dikatakan bahwa keseluruhan permintaan dalam waktu dekat kemungkinan besar akan dikurangi, mengingat penurunan penerimaan yang masih belum dapat ditutupi. Pada segmen propertinya, dikatakan bahwa ia hanya mendapatkan penjualan yang minimal pada masa MCO, dan melihat prospek ekonomi yang masih menurun, diprediksikan performa segmen dalam tahun ini akan mendapatkan dampak negatif. Disampaikan juga kalau Outlet Premium-nya akan fokus untuk membangun patronase saat dimulainya opearasional pada awal bulan Mei 2020. Pada segmen bioteknologi, Genting Plantations mengatakan bahwa ia akan terus mengembangkan solusi komersial dan applikasi-applikasi untuk meningkatkan hasil panen dan produktivitas minyak kelapa sawit. Diharapkan segmen manufaktur hilirnya dapat menghadapi tantangan pada masa ini yang dikarenakan rendahnya permintaan untuk produk-produknya akibat pandemi COVID-19. Lebih lanjut lagi, permintaan untuk campuran diskresioner untuk biodiesel telah mereda karena penyebaran minyak kelapa sawit (POGO) yang tidak menguntungkan. Saham Genting Plantations tercatat 12 sen atau 1.26% lebih tinggi pada angka 9.66 Ringgit Malaysia hari ini, mengingat kapitalisasi pasar grup di angka 8.67 miliar Ringgit Malaysia. Angkanya telah pulih 14% dari titik rendah di 8.50 Ringgit Malaysia pada tanggal 19 Maret, sehari setelah diberlakukannya MCO. Namun masih 9% lebih rendah jika dibandingkan dengan nilai akhir tahun pada tanggal 31 Desember 2019 di 10.58 Ringgit Malaysia.

Higher selling prices of palm products boosted Genting Plantations Bhd’s net profit for the first quarter ended March 31, 2020 (1QFY20) by more than twofold to RM91.3 million, from RM41.68 million a year earlier. In a filing with Bursa Malaysia, the group said crude palm oil (CPO) prices increased by a third to RM2, 619 per metric ton (mt) in 1QFY20, from RM1, 974 per tonne in FY19, while the selling price of palm kernel was up by a fourth to RM1, 593 from RM1, 283 a year ago. Earnings per share (EPS) for 1QFY20 rose to 10.18 sen from 5.16 sen. Revenue, however, fell 8.47% to RM569.04 million mainly due to softer demand for refined palm products of its downstream manufacturing segment. The group said fresh fruit bunch (FFB) production was 19% lower year-on-year, largely attributed to the lagged effect of adverse weather condition in 2019 which crimped its Malaysian crop output. The temporary suspension of operations in some estates during the nationwide movement control order (MCO) period also affected production. While operations in Indonesia also experienced the lagged effect of adverse weather condition, the impact was mostly cushioned by an increase in harvesting area and a better age profile. On prospects, the group said the outlook for the rest of the year will track the performance of its mainstay plantation segment, which in turn is dependant principally on movements in palm product selling prices and the group’s FFB production. As the COVID-19 pandemic continues to severely affect economies worldwide, the group expects palm oil prices to be primarily influenced by the impact of the pandemic on factors such as demand and supply dynamics of palm oil and other substitute oils and fats, global economic conditions and the implementation of higher biodiesel mandates by Indonesia and Malaysia. Given the notable year-on-year decline in FFB production in the first quarter of this year, the group expects to make up for the deficit in the remaining months of the year, underpinned by additional mature areas and a favourable age profile of its Indonesian operations. However, it said overall demand in the near term will likely be subdued, with the decline in uptake thus far unlikely to be recouped. On its property segment, it said it derived minimal sales during the MCO period, and given the bearish economic outlook, it expects the segment's performance for the rest of the year to be negatively impacted. It also said that its Premium Outlets will focus on building up patronage following the resumption of operations in early May 2020. On its biotechnology segment, Genting Plantations said it will continue its work on developing commercial solutions and applications to enhance the yield and productivity of oil palm. It expects its downstream manufacturing segment to face challenging times due to weak demand for its products stemming from the COVID-19 pandemic. Further, demand for discretionary blending for biodiesel has subsided due to the prevailing unfavourable palm oil-gas oil (POGO) spread. Shares in Genting Plantations closed 12 sen or 1.26% higher at RM9.66 today, giving the group a market capitalisation of RM8.67 billion. The counter has regained 14% from a low of RM8.50 on March 19, a day after the MCO was implementated. But it is still 9% lower than its year-end price of RM10.58 on Dec 31, 2019.



Palm Oil Today Indonesia

Pedoman Produksi Minyak Kelapa Sawit Berkelanjutan


liansi Pongo, merupakan aliansi para petani minyak kelapa sawit, pelaku usaha dan praktisi konservasi, sedang mengembangkan pedoman untuk praktisi manajemen terbaik (BMP) guna mendukung produksi minyak kelapa sawit yang berkelanjutan serta mencakup ruang aman bagi orang-utan liar di luar kawasan hutan lindung. Dengan adanya visi untuk menciptakan kondisi yang bisa bertahan bagi margasatwa dan manusia menjadi sebuah kenyataan, aliansi ini menggunakan pendekatan berbasis bukti, dan ditemukan bahwa beberapa orang-utan tidak hanya selamat dari hilangnya habitat mereka dalam skala besar pada tahun 1980-an dan 1990-an, namun juga beradaptasi dengan kondisi fragmentasi hutan dan perkebunan kelapa sawit. Direktur Proyek Kinabatangan Aliansi Pongo, Dr. Felicity Oram, mengatakan langkah-langkah dapat dilakukan untuk mendukung keberlangsungan hidup populasi orang-utan liar yang selamat, di mana hanya 10 persen dari setengah juta hektar lahan yang masih merupakan hutan. “Kita perlu lebih memahami, habitat orang-utan pada kondisi yang telah berubah ini dan mencari cara untuk memfasilitasi kehidupan berdampingan antara manusia dan orang-utan dalam jangka panjang. “Dalam prakteknya, hal ini berarti membiarkan orang-utan liar pada habitatnya dan mengembangkan cara yang lebih baik untuk mendukung adaptasi yang telah dilakukan margasatwa sejauh ini,” ungkapnya dalam sebuah pernyataan. Yayasan Sime Darby (YSD) telah berkomitmen dengan dana sebesar 1.2 juta Ringgit Malaysia, dalam sebuah perjanjian sponsor berjangka dua tahun “Penciptaan Kondisi Kehidupan Berdampingan Manusia dan Orang-utan di Kinbatangan (Creation of a Human and Orangutan Coexistence Landscape in Kinabatangan)”, memungkinkan program untuk mengumpulkan informasi yang terperinci, dan mengembangkan praktik manajemen terbaik. Sponsor ini sejalan dengan fokus lingkungan YSD untuk melindungi dan melestarikan spesies yang rentan dan terancam punah, serta mendidik dan meningkatkan kesadaran pada kalangan komunitas perkebunan kelapa sawit, lembaga swadaya masyarakat, lembaga pemerintah, dan komunitas internasional. Direktur Utama YSD, Dr. Hajah Yatela Zainal Abidin, mencatat bahwa penelitian telah menunjukkan bahwa orang-utan betina hidup dan membesarkan anak-anaknya di fragmen hutan yang dikelilingi oleh kelapa sawit, sedangkan orang-utan jantan melakukan perjalanan jauh melalui perkebunan kelapa sawit dari satu fragmen hutan ke fragmen hutan yang lain. “Proyek ini bertujuan untuk mengetahui secara rinci kondisi di Kinabatangan, hingga pada tingkat individu orang-utan. “Kami berharap bahwa upaya ini dapat membantu para petani dan lembaga swadaya masyarakat untuk melihat dan mengelola kondisi hutan kelapa sawit yang akan mendukung kehidupan bersama antara manusia dan orang-utan; dan agar lembaga pemerintah dapat mengembangkan kebijakan baru dalam pengelolaan orang-utan dan juga bagi komunitas internasional untuk dapat mengerti bahwa hidup berdampingan pada kondisi yang beragam seperti campuran antara perkebunan kelapa sawit dan hutan sangatlah mungkin,” lanjutnya. Perusahaan mitra yang terlibat dalam perubahan paradigma ini dan yang memiliki kepemilikan dalam area proyek di antaranya adalah Sime Darby Plantation Berhad (SDP), yang menampung Aliansi Pongo dan mitra yang berada di Sabah, Sawit Kinabalu, di mana lahan seluas 3,757 hektar miliknya telah diperuntukkan guna konservasi lingkungan. Direktur Utama dari Grup SDP, Mohamad Helmy Othman Basha, menyatakan inisiatif oleh Aliansi Pongo sejalan dengan ambisi SDP untuk mencapai industri minyak kelapa sawit yang bebas penebangan hutan dan perusahaan sangat berharap untuk mengimplementasikan BMP di perkebunannya. “Kami menyadari perlunya dan pentingnya menjaga habitat alam bagi spesies yang terancam punah dan tidak hanya akan bekerja sama dengan organisasi yang sepaham seperti YSD dan mitra kami di Aliansi Pongo, namun kami juga mendorong perusahaan perkebunan kelapa sawit lain untuk ikut serta mencapai tujuan ini,” lanjut Helmy. Dia juga mencatat bahwa proyek yang berkolaborasi dengan Aliansi Pongo adalah tindak lanjut yang logis dari kerja sama selama 10 tahun antara YSD dan Departemen Kehutanan Sabah mengenai proyek ‘Reboisasi dan Rehabilitasi Habitat Orang-utan di Ulu Segama Utara (kini lebih dikenal dengan nama Cagar Hutan Bukit Piton)’. Dia menjelaskan bahwa proyek senilai 25 juta Ringgit Malaysia tersebut, di mana SDP menyediakan bantuan teknis, meningkatkan kondisi habitat orang-utan dengan menanam 1,448,822 pohon di dalam Cagar Hutan yang dahulu sangat terdegradasi dan berkontribusi dalam manfaat ekonomi kepada komunitas setempat di area sekitarnya.


Dr Felicity (keempat dari kanan) beserta mitra perkebunan kelapa sawit di lapangan.

Guidelines on Sustainable Palm Oil Production The Pongo Alliance, an alliance of oil palm growers, businesses and conservation practitioners, is developing guidelines for best management practices (BMP) to support sustainable palm oil production that includes safe spaces for wild orangutans outside of the protected areas. With a vision to make resilient landscapes for wildlife and people a reality, the alliance uses an evidence-based approach, which found that some orangutans not only survived large-scale habitat loss in the 1980s and 1990s but adapted to a landscape of forest patches and oil palm plantation. The Pongo Alliance Kinabatangan’s Project Director, Dr Felicity Oram, said that measures can be put in place to support co-existence of the surviving wild orangutan population where only 10 per cent of the half-million-hectare land area is forest. “We need to better understand the orangutan habitat needs in this altered landscape and work out how to facilitate human and orangutan co-existence in the long term. “In practice, this means leaving wild orangutans wherever they are in the landscape and developing better ways to support the adaptions these animals have made thus far,” she said, in a statement. Yayasan Sime Darby (YSD) has committed RM1.2million, under a two-year sponsorship agreement titled “Creation of a Human and Orangutan Coexistence Landscape in Kinabatangan”, to enable the programme to conduct detailed information-gathering, engagement with various players, and develop best management practices. The sponsorship is in line with YSD Environment pillar’s focus area of protecting and preserving vulnerable and endangered species, as well as the education and awareness focus area as it involves building awareness within oil palm plantation communities, environmental non-governmental organisations (NGOs), government agencies, and international communities. YSD Chief Executive Officer, Dr Hajah Yatela Zainal Abidin, noted that research has shown that female orangutans live and raise their young in forest fragments surrounded by oil palms, while the males travel long distances through oil palm plantations between these patches. “This project aims to find out in more detail what is going on in Kinabatangan, to the level of individual orangutans. “We hope that this effort will also assist growers and NGOs alike to view and manage oil palm forest landscapes in favour of human-orangutan coexistence; government agencies to develop a new policy on orangutan management and the international community to understand that such coexistence is possible in mixed landscapes such as those comprising oil palm plantations and forests,” she said. Full partner companies involved in this paradigm shift that have holdings in the project engagement area include Sime Darby Plantation Berhad (SDP), which hosts the secretariat of Pongo Alliance and Sabah based partner, Sawit Kinabalu, which has committed 3,757 hectares of its land area to conservation set-asides. SDP Group Managing Director, Mohamad Helmy Othman Basha, said the initiative by Pongo Alliance aligns with SDP’s ambition to achieve a deforestation free palm oil industry and the company looks forward to implementing the BMP at its estates. “We are cognisant of the need and importance of safeguarding the habitats of endangered species and not only will continue to work with like-minded organisations such as YSD and our partners in the Pongo Alliance but also encourage other plantation companies to come on board to achieve this goal,” said Helmy. He also noted that the project in collaboration with Pongo Alliance is a logical follow-up on of YSD’s 10-year collaboration with Sabah Forestry Department on the ‘Reforestation and Rehabilitation of Orangutan Habitat in Northern Ulu Segama (presently known as Bukit Piton Forest Reserve)’ project. He explained that the RM25 million project, in which SDP provided its technical expertise and assistance, improves the orangutan habitat by planting 1,448,822 trees within the previously highly degraded Forest Reserve and contributed economic benefits to the local community in the surrounding area.


Palm Oil Today Indonesia

Permintaan Bahan Bakar Nabati di EU Tetap Stabil, sahut Lipido Santiga


ermintaan bahan bakar nabati yang berasal dari minyak kelapa sawit di Uni Eropa (EU) diperkirakan akan tetap stabil pada tahun ini, menurut sebuah perusahaan minyak nabati terkemuka di Eropa. Lipidos Santiga SA (Lipsa) mengatakan bahwa secara keseluruhan, penggunaan bahan bakar di EU telah menurun semenjak diberlakukannya penutupan akses keluar masuk untuk menhentikan penyebaran COVID-19. “Sektor bahan bakar nabati dapat merasa senang karena semua truk dan bus umum yang menggunkan bahan bakar membantu mempertahankan tingkat penggunaan bahan bakar selama masa penutupan,” kata direktur penjualan Lipsa, José Angel Olivero Garcia. “Penurunan pemakaian bensin dan bahan bakar pesawat jet jauh lebih tinggi,” tambah Garcia pada sebuah webinar yang diselenggarakan oleh Malaysia Palm Oil Council (MPOC). Dia mengatakan total konsumsi bahan bakar di EU pada tahun 2019 ada di angka 200 juta ton. Dalam halnya bahan bakar nabati, total penggunaan diestimasikan di angka 17 juta hingga 18 juta ton, atau 8.4% kandungan energi dari total produksi bahan bakar. Produksi bahan bakar nabati dalam negeri mencapai 15 juta ton, sementara angka impor bersih mencapai 2.5 juta ton. Garcia mencatat bahwa Spanyol menyaksikan penurunan 60% pada konsumsi bahan bakar, sementara di Eropa Utara, di mana lebih banyak menggunakan bensin daripada bahan bakar, lebih sedikit terpengaruh yang mengakibatkan sekitar 35% hingga 50% penurunan pengguaan bahan bakar. Sebagai akibat dari penutupan akses dan krisis ekonomi di EU, total permintaan bahan bakar diperkirakan akan menurun 10% hingga 20% tahun ini, lanjutnya. “Di sisi lain, positfnya adalah mandat bahan bakar nabati akan meningkat di mana akan mengimbangi tingkat penggunaan bahan bakar yang lebih rendah,” tambahnya. Sementara itu, di sektor pangan, Garcia mencatat bahwa kurangnya pariwisata pada daerah tersebut akan mengurangi konsumsi minyak kelapa sawit.“Banyak hotel yang menawarkan paket all-in, sehingga banyak turis mengambil apa yang bisa mereka ambil,” tambahnya. Selain itu, langkah-langkah menjaga jarak sosial menyebabkan lebih sedikit perayaan dan acara juga menjadi faktor yang merugikan. Ini karena komponen utama dalam kue dan kue kering adalah margarin, yang terbuat dari minyak kelapa sawit, kata Garcia. Dan juga, minyak kelapa sawit memiliki reputasi buruk di daerah ini. “Singkatnya, minyak kelapa sawit akan menjadi bagian kecil di Eropa. Bukan hanya kurangnya pemakaian di dalam makanan, juga karena ia mulai tergantikan di pasar bahan bakar nabati. Jika hal itu terjadi, maka konsumsi minyak kelapa sawit akan menurun,” lanjutnya. Di bawah Pengarahan Energi Terbarukan II (Renewable Energy Directive II) dari EU, penggunaan bahan bakar nabati yang terbuat dari minyak kelapa sawit akan mulai dihapuskan secara bertahap mulai dari 2023 hingga 2030, karena dugaan masalah lingkungan. 26

Biodiesel Demand in the EU to Remain Stable, Says Lipidos Santiga Palm oil-derived biodiesel demand in the European Union (EU) is expected to remain stable this year, says a leading European vegetable oils firm. Lipidos Santiga SA (Lipsa) said that on the whole, diesel usage in the EU has declined following the lockdowns instituted to halt the spread of COVID-19. “The biodiesel sector can be happy that all trucks and public buses run on diesel because they helped maintain the usage of diesel during the lockdowns,” said Lipsa sales director José Angel Olivero Garcia. “The collapse in gasoline and jet fuel has been much bigger,” added Garcia in a webinar organised by the Malaysia Palm Oil Council (MPOC). He said the EU’s total diesel consumption in 2019 was 200 million tonnes. In terms of biodiesel, total usage was estimated at 17 million to 18 million tonnes, translating into an energy content of 8.4% of total diesel production. Domestic production of biodiesel stood at 15 million tonnes, while net biodiesel imports totalled 2.5 million tonnes. Garcia noted that Spain saw a 60% decline in diesel consumption, while northern Europe, which uses more gasoline than diesel, was less affected resulting in an estimated 35% to 50% reduction in diesel consumption. As a result of the lockdowns and economic crisis in the EU, total diesel demand is expected to decline by 10% to 20% this year, he said. “On the other hand, a positive is that biodiesel mandates are set to increase and the higher mandates will compensate the lower diesel use,” he added. Meanwhile, in the food sector, Garcia noted that the lack of tourism in the region will hurt palm oil consumption. “Many hotels offered the all-included formula, so many tourists grabbed what they could at the buffet,” he added. Furthermore, social distancing measures which lead to fewer celebrations and outings will also be a detrimental factor. This is because a key component of cakes and pastries is margarine, which is made using palm oil, said Garcia. On top of this, palm oil has a negative reputation in the region. “Shortly, palm oil will be a minor oil in Europe. Not only because of its declining use in food, but also because of it being phased out of biodiesel. If that happens, the consumption of palm oil will come down,” he said. Under the EU’s Renewable Energy Directive II, the usage of palm oil-derived biofuels in the bloc will be gradually phased out starting in 2023 until 2030, due to alleged environmental concerns. 27


Palm Oil Today Indonesia

Industri Minyak Nabati India Menginginkan Pembatasan Impor Minyak Kelapa Sawit Murni


EW DELHI: Pemerintah seharusnya tidak mengeluarkan lisensi untuk impor minyak kelapa sawit murni kepada perusahaan untuk melindungi pabrik penyulingan dan petani minyak nabati, kata asosiasi dan analis minyak nabati. Asosiasi industri minyak nabati Indian Vegetable Oil Producers Association (IVPA) dan The Solvent Extractors Association of India (SEA) telah meminta pemerintah untuk mengatasi masalah ini dan membawakan permasalahan ini kepada Menteri Perdagangan dan Industri Piyush Goyal. Pelaku industri ini juga mengatakan bahwa ketersediaan tenaga kerja untuk pengemasan dan memastikan petani mendapatkan dukungan harga minimum untuk mustar adalah hal yang yang harus diperhatikan untuk saat ini. Minggu lalu, pemerintah mengizinkan impor minyak kelapa sawit murni setelah pembatasan yang diterapkan di bulan Januari, untuk memastikan ketersediaan dan kestabilan harga pasar domestik.“Keputusan untuk mempermudah persyaratan mengimpor minyak kelapa sawit murni mungkin disebabkan oleh penutupan akses keluar masuk yang sedang berlangsung namun keputusan ini akan memiliki dampak buruk pada industri penyulingan minyak nabati domestik dan unit pendukungnya. India memiliki kuantitas dan kapasitas yang cukup untuk proses penyulingan minyak kelapa sawit mentah,� ungkap Sudhakar Desai, presiden IVPA dalam sebuah surat Kementerian Perdagangan.

Total permintaan bulanan minyak kelapa sawit senditi telah menurun hampir 80% menjadi 350,000 ton hingga 400,000 ton pasca penutupan akses keluar masuk dikarenakan penjualan yang menurun, kata Atul Chaturvedi, presiden SEA. Permintaan ini dapat dengan mudah dipenuhi oleh kilang penyulingan minyak nabati domestik. Chaturvedi mengatakan, bahwa petani mustar yang sedang memanen hasil panen mendapatkan harga di bawah MSP yaitu 4,410 Rupee India per kuintal dan impor minyak kelapa sawit murni akan memperburuk situasi petani-petani dengan menurunkan realisasi produk mereka. Pada saat ini, harga minyak kelapa sawit mentah berada di 680 Rupee India per 10 kg dalam pasar grosir mirip seperti harga pada bulan lalu, sahut Sandeep Bajoria, presiden direktur firma konsultan minyak Sunvin Group. “Harga sedang berada di batas wajar, permintaan telah menurun dan kami tidak menyarankan impor minyak kelapa sawit murni diizinkan,� tambahnya. India telah mengimpor 15 juta ton minyak nabati dari Indonesia, Malaysia, Ukraina dan Amerika Serikat setiap tahun dan di antaranya termasuk 9 juta ton minyak kelapa sawit.



Palm Oil Today Indonesia

India’s Edible oil industry wants import of refined palm oil to be restricted NEW DELHI: The government should not issue licenses for import of refined palm oil to companies to protect local refiners and oilseed growers, said edible oil associations and analysts. Edible oil industry body Indian Vegetable Oil Producers Association (IVPA) and The Solvent Extractors Association of India (SEA) have asked the government to addresses the issue and given representation in this regard to Commerce and Industry Minister Piyush Goyal. The industry also said that labour availability for packing and ensuring farmers get minimum support price for mustard should be the focus for now. Last week, the government had allowed imports of refined palm oil after restricting them in January, to ensure availability and stable prices in the domestic market. “The decision for easing the conditions for import of refined palm oil might be due to the present lock-down situation but this will have an adverse impact on the domestic edible oil refining industry and its ancillary units. India has sufficient quantity and capacities to refine the crude palm oil,” said Sudhakar Desai, president, IVPA in a letter the Commerce ministry. The total monthly demand of palm oil alone has come down by almost 80% to 3.5 to 4 lakh tonne post the lockdown due to drop in institutional sales, said Atul Chaturvedi, president, SEA. This demand can easily be met by the domestic edible oil refining industry, said companies. Chaturvedi said, that mustard farmers who were harvesting the crop were getting prices below the MSP of Rs 4,410 per quintal and import of refined palm oil will further add to the woes of the farmers by way of lower realisation for their produce. Currently, the crude palm oil prices are at Rs 680 per 10 kg in wholesale which is similar to a month ago, said Sandeep Bajoria, chief executive officer of oil consultancy firm Sunvin Group. “Prices are in a reasonable range , demand has dropped and we don’t think it’s advisable to allow refined palm oil import,” he said India has been importing 15 million tonnes of vegetable oils annually from Indonesia, Malaysia, Ukraine and USA and out of this palm oil comprises 9 million tonnes.



Palm Oil Today Indonesia

Steering the Indonesian Palm Oil Industry out of the Pandemic I will cover the analysis of challenges and industrial opportunity in the downstream of the palm oil sector in the middle of COVID-19. There are three parts that I would like to discuss the performance in the palm oil industry in Indonesia, the impact of the COVID-19 pandemic in the palm oil industry, and the ways government and companies did so far to minimize the impact of this outbreak to the palm oil industry. We can see that the palm oil industry’s role in our economy is quite high especially in the absorption of the manpower from the upstream to employ 4.3 million workers. The downstream sector employs around 4.2 million workers and there are around 12 million workers involved in the processing of palm oil. The palm oil economy is quite big; from the upstream to downstream absorbs more than 20 million workers. If we assume a household, the palm oil-based economy is providing livelihood to more than 90 million people in Indonesia. In 2019, the export is 21.4 billion USD and the contribution is around 13% to the non-oil and gas. This is one of the biggest single sector income in Indonesia. Starting in 2016, the contribution of our export is more than our oil and gas contribution. The PDB/gross income of the palm oil business provides security to our energy which comes from the biofuel supply. This contribution is for the raw material, such as for the cooking oil. This is the highlight of the Indonesia profile palm oil industry, which we are supported by the plantation with more than 16 million hectares of palm oil plantation in 16 provinces. The production of crude palm oil (CPO) is around 52 million tonnes and this is the increase of non-percent increase compare to 2019. The CPO is around 5.69 million tonnes and the local consumption of palm oil is around 16.7 million tonnes. We also have CPO and derivatives products with around 35.7 million tonnes being exported. The biodiesel of the export country such as China is exported together to the European Union (EU). We have palm oil plantation and factory for CPO and crude palm kernel oil (CPKO), with 86 companies in the refinery industry with capacities up to 56 million tonnes per year. The biodiesel industry consists of 19 industries with capacities of 12 million kl per year. The oleochemical industry is 21 with capacities of 11.3 million tonnes per year. The biodiesel industry in fatty acid methyl ester (FAME) is developing whereas, in 2019, the absorption is around 6.82 million kl. We hope to target around 9.6 million kl in 2020. The biofuel development in Indonesia is endorsed by Indonesian policy. We have government regulation 24, 2015 and we also have presidential regulation 61, 2015 regarding the collection and the utilization of the plantation funding and revised by presidential regulation 66, 2019. The government has provided a policy for the export collection to provide replanting and also to support the renewable from the palm oil. We can see that the impact of COVID-19 in the downstream sectors such as in the industrial operational, mobility disruption, and market access. The industrial operational is still working on the reduction of the capacity and the production utility. We have the policy of large-scale social restrictions (PSBB) here in Indonesia and the government has a secular letter from the ministry of industry number 4, 2020 for the operational license for mobility and utilization. The palm oil industry can continue with implementing the health protocol under PSBB. We still don’t have any layover from the employees in the palm oil industry although there are changes in the way they work because of PSBB and also with the restriction of production to the foreign country. We have limited carriers in the mobility disruption because of the lockdown in the exported countries. For the document of export and import for the inspection, we found the report showing the difficulty of work from home and in the office but only at the beginning of PSBB We also notice the hindrance of mobility problem but it's only at the beginning of PSBB. However, the price of CPO among the farmers' level is still good. The export market access is quite increasing especially for soap, noodles, and the raw material for soap such as fatty acid and (FOH). Food such as cooking oil and padatan is quite slow but the domestic markets such as soap and daily food are increasing. Indonesia's government committed to the policy of B30 or the biodiesel mixture programme, thus we can absorb the production of palm oil although it’s slightly reducing in this pandemic time. Here are several policies that have been issued by the government : i) the ministry of finance regulation regarding tax incentives on number 23 and 22 for parties that are infected by the COVID-19. ii) tax facilitation for article 21 and also the final income text which is bear by the government. iii) tax is being weaved for certain areas for export and import. iv) the ministry of industry has secular letter numbers 4, 7, and 8; all in 2020 provides a license for operational and mobility during the PSBB in this pandemic time. v) the facilitation for the SBE waste management facilities which are letter number 320. vi) the letter from the minister of industry number 368 which is the discount for the industrial electricity price.

Ir. Edy Sutopo, M.SI, Director for Forest and Agriculture Based Industry, Ministry of Industry Republic of Indonesia.

We provide incentives to reduce the electricity cost which is suggested by the Ministry of the Industry and we also have other policies for the guest. There are also other issues that we are still battling such as; restructure the loan for funding on working. However, this is still in process and we have yet to issue the policy. Indonesian government remained committed to the B30 policy as this programme is beneficial for the palm oil industry in large. The tangible benefit is in the demand management where we can create a demand for biodiesel so we can maintain the CPO global price. The other benefits are the production of B20 in 2019 which is around 6.7 million kl, to employ around 435, 000 plantation workers, to reduce 16 million tonnes of CO2 equivalent, and the import of fuel around 6.64 million kl. This is how we relate the B30 programme on the task and function of the Ministry of the Industry. One of our tasks is to endorse a more conducive business climate, thus we are issuing a policy for the industry and investment to endorse for the development and the downstream palm oil business. The Ministry of the Industry has issued a mobility permit for the palm oil industry which means they can remain in operation during the pandemic time but with maintaining the health protocol. From 2010 until 2020, we recommended eight biodiesel factories to be given text allowance. B30 mandatory policy is a part of our national energy provision road map which starts from biodiesel such as B30 and B40. We have green fuel which is; the green diesel, green gasoline, and greenavtur. We have started the development and try the testing for co-processing in Pertamina. At the moment we are designing for the stand-alone and other programmes concerning this bio-energy policy. We wish for the biodiesel, biofuel, battery, and natural gas to be used in the automotive industry. This is the potential for the palm oil-based renewable energy source that we can save from 70 tonnes in 2008. However, in 2019, it becomes 48 tonnes and we also have the nickel opportunity for the battery. The table roadmap for the development palm oil-based industry discusses; i) B15 for micro and non-PSO transportation and commercial business from April 2015. ii) B25 for electricity/power generation from April 2015. iii) B20 for household, micro-business, industry, and commercial and non-PSO transportation from January 2016 and B30 for power generation. iv) B30 for the biodiesel mixture programme in January 2020. The Indonesian government has stayed in their commitment to the roadmap that in 2020, we need to implement B30 although we have several hindrances such as the pandemic and the reduction in solar demand. We target for B40 in July 2021 thus we can use FAME and fossil solar. In 2021, the green solar can be received by the co-processing under Pertamina but probably the stand-alone won't be available by then. The factories for green fuel in which raw material is 100% CPO, we hope can start by 2024. In recent times, there are several investors such as from Japan who wish to be a part of this. Next, I would like to talk about the export potential of FAME in 2020. From 2009 and 2019, all the domestics need can be fulfilled as APROBI has submitted the proposal for biodiesel export license recommendation. We have responded with the director-general (DG) letter to the DG of renewable energy from the ministry of energy and mineral resources number B/161/IA/IND/2020. We gave support for the biodiesel export during the pandemic of COVID-19. If we give an assumption that there is demand reduction and that COVID-19 will be finished by July 2020, we will have a reduction of demand. However, if the pandemic goes more than July 2020, the reduction will be more significant and this can be an opportunity for Indonesia to export.



Palm Oil Today Indonesia

Rino Afrino ST, MM, Secretary General of the Indonesia Palm Oil Smallholder’s Association (APKASINDO)

I will discuss on the Indonesian smallholders versus COVID-19. We are from Indonesia Palm Oil Smallholder’s Association (APKASINDO). APKASINDO is a professional organization of oil palm smallholders. We are 20 years of age our branches are in 22 provinces with 170 regencies throughout Indonesia. We are a part of the Indonesian palm oil industry and it’s been quite a long journey. APKASINDO involves all types of smallholders including independent farmers. The data from the Ministry of Agriculture show that the land coverage of Indonesia oil palm is about 16.38 million hectares and the portion of the land coverage is about 6.72 million hectares. This is from the east to the west; from Acheh province to Papua province. One of the classical issues in people’s oil palm plantation is that productivity has not been optimized yet. The president of Indonesia, Joko Widodo has launched a strategic rejuvenation of oil palm programme to aid the farms that are not productive because of bad seed/not being harvested. 2.8 hectares will become the target of the rejuvenation programme. APKASINDO functions to encourage the growers/farmers to participate in the good programme by the government and for the growers/farmers to have member cards as oil palm farmers. This is as we can help the farmers/growers to become professional so that they have food productivity and sustainability. It’s important how we can bridge the interest of oil palm smallholders, government, and private sectors in the context that which is a win-win situation that doesn’t cause any disadvantages to any parties. Lastly, we also advocate and facilitate the smallholders of anything that may disadvantage them. During the beginning of the pandemic, we conducted a survey to the farmers which spread to 37 provinces on 100 people on a certain platform. We found that in the villages : i) 82.9% of farmers didn't possess positive COVID-19 cases. ii) 62.8% of farmers mentioned that there was no COVID-19 influence or effect daily. iii) There was no significant impact or influence in terms of the total number of yield in routine harvesting iv) 90.2% of farmers stated that the harvesting schedule didn’t change. v) Farmers feel there's no change in terms of pricing/the factories/mills faced with no change in servicing in buying/receiving FFB. vi) Farmers experience price fall although compare to the same month last year, in 2020 the price is relatively higher and better. The data of prices of oil palm farmers in the Riau province shows that start from the B30, biodiesel increase in January but slowly declined from February to March. Nevertheless, it increases from March to April, leading up to the end of Ramadhan and dropped until May. At the end of Ramadhan, the price rebounded. Today, the price is increasing and the average price is about 1500/FFB. Throughout 2019, the price is under 1400 approximately. It is interesting that in 2018, the price tends to be relatively high over 1700Rp. By June 2018, the price started to decline. There was no export in 2019 as the gross and the price remain the same. We are grateful that during the pandemic from January to June, the price condition is relatively stable and well. vii) 39.5% of farmers are experiencing a reduction of income from their yield whereas the remaining is still the same as the usual price. viii) 57.3% of respondents stated that the mills didn’t comply with the price. ix) Oil palm farmers mostly don't want to receive any assistance due to the pandemic as there actively assist in the form of face mask as well as essential food products to the people living in the community area. Several important points that we would like to convey : i) The price of FFB of farmers are better in 2019 ii) The economic condition of oil palm farmers is quite well. Plus, the mill should not be closed therefore we would like to thank the regional government and the governor as they firmly issued a letter to the mills to remain open to buy FFB from farmers.


iii) The oil palm farmers didn’t want to receive any assistance from the government so a lot of them have conducted social events instead of the communities living around the oil palm plantations. iv) There is a bit concern on COVID-19 but the farmers/growers are working with conditions under the sun which is quite hot and adhere to the health protocol wearing a face mask, washing hands, and avoiding crowds. v) The low price of FFB received by the farmers because the mills don’t comply with the pricing determined by the government. Several important points that we would like to convey; i) The price of FFB of farmers are better in 2019 ii) The economic condition of oil palm farmers is quite well. Plus, the mill should not be closed therefore we would like to thank the regional government and the governor as they firmly issued a letter to the mills to remain open to buy FFB from farmers. iii) The oil palm farmers didn’t want to receive any assistance from the government so a lot of them have conducted social events instead of the communities living around the oil palm plantations. iv) There is a bit concern on COVID-19 but the farmers/growers are working with conditions under the sun which is quite hot and adhere to the health protocol; wearing a face mask, washing hands, and avoiding crowds. v) The low price of FFB received by the farmers because the mills don’t comply with the pricing determined by the government. The question is how this national strategic programme that has a direct impact on the increase in productivity and strengthening the economy helps the oil palm farmers to continue to operate. The government conducted a programme called the People Oil Palm Rejuvenation Programme and perhaps about 2 million hectares of land belonging to farmers and households will be involved. This functions to increase productivity by twice than before. The next strategic programme is in the process and we will continue the land certification programme for the farmers. This agricultural reformed programme relates to the availability of land that has not to be cleared to the farmers in the forest areas. This follows with the partnership, capacity building, or human resources as well as institutional reinforcement which 1200 smallholders children have been receiving the scholarship. Lastly, we hope that productivity will increase and farmers/growers will be more creative.




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Palm Oil Today Indonesia

Dr. Suroso Rahutomo, General Manager of Strategic Business of Indonesia Oil Palm Research Institution.

I would like to discuss the expectation of the Indonesian palm oil industry on the COVID-19 pandemic, especially among the smallholders. We will talk on the palm oil industry at a glance, COVID-19 impact, together with the adaptation strategy and challenges. Our export countries in the EU and Asia such as China, India, and Spain are impacted by the pandemic greatly. Thus, more or less it also impacted our export performance to those countries. However, in Indonesia, the provinces that used to be the basis of the palm oil industry are relatively not impacted. Many COVID-19 cases are on Java island but not on the islands of palm oil plantation basis such as North Sumatera and Kalimantan. The two provinces such as Riau and North Sumatera which is the largest palm oil estate is much better to compare with the case of COVID-19 in Java. To compare 2019 and 2020, our export will not change much as the improvement is from domestic consumption. We believe this is related to the government's ongoing B30 programme. We also expect production as it runs from 33.3 million tonnes and for it to have a suitable increase this year of 44.7 million tonnes. There’s a correlation between the pandemic with the CPO export performance. Some of the export drifted product data that we received are increasing and it’s relevant to the need of the global society of certain products related to health and sanitary. However, up until May this year, we received few data for biodiesel export. We saw this significant increase in the export but we have not yet received any data whether this is relevant to the reduction of activities of the export countries of Indonesia biodiesel. This will require further study.

As mentioned by Mr. Rino Afrino previously, they have surveyed COVID-19 impact on smallholder plantation and we also have conducted a similar survey but we compare it to the private companies in several countries. The data that we get shows the impact of what they do concerning activities related to the maintenance of the plants that are not in the production. There’s a reduction in fertilizer application, pruning activities, and LCC management for the non-producing plants' smallholders plantation but this doesn't occur in the big plantation. For the producing


palm oil plants, there are changes in the management on the field, especially among smallholder plantations. There are several growers with good institutional management but some do not. Few of the growers/plantations do not have any affiliations. Nothing has changed for the big plantations as they are still applying fertilizers. This is different from the smallholders during the COVID-19 pandemic as they reduce the fertilizer, activity maintenance, and pest issues. Concerning the turn over with the workers; there’s a big turn over for the smallholders before the pandemic, from 51 respondents before COVID-19 around 51% however there’s not much turnover during the pandemic which means that their workers are not in and out. This is different for the big plantation as the turnover is bigger during the COVID-19 outbreak. They don't do layover or reduce the laborers. Many of the smallholder plantations are reducing the budget for maintenance and fertilizer. In my opinion, the survey is still developing and ongoing. During the outbreak, several respondents have mentioned that there is a decrease in the price so they reduce the fertilizer and maintenance activities. There are several adaptation strategies; from our study that we conducted several months ago before the pandemic, several of our respondents in the smallholders are interested in utilizing the biomass but we’ve yet to explore this further. We hope that the smallholders can mix their plants with other farming if their plants are not in the production which can help their generation to steer out from the situation of where their plants are not in the production or the price is low. We saw that if the institutional capability and management are stronger, the smallholders have resilient and they can adapt and survive in circumstances such as pandemic and price reduction apart from the management side. They also have income generation and support from their affiliation. The respondent is not receiving any social support from the government but several farmers are not strong in institutional management plus affiliation are happy to receive it. Plus, they also expect to have a price subsidy for fertilizer. The places which are far from the fertilizer factory experienced very expensive pricing for fertilizer at the beginning of the pandemic. We also have lots of restrictions during the PSBB thus farther houses from the warehouse will experience an issue regarding this. Therefore, we hope that we will have a partnership between smallholders and big plantations in the future as the price received by smallholders are less than the big plantation. I believe that they’re a lot of potentials that can be developed to improve the downstream industry, especially for smallholder plantations. I hope that we will get into industrialization at the smallholders' level for the new normal. If we can implement CPO to become biodiesel, the smallholders can sell it and not only the raw material. Hopefully, this idea can be achieved and the smallholders can become a player for this downstream level as well. Several challenges that we experience during the pandemic; i) CPO-Fund Export Levy increased to 55 USD MT-1 CPO. The fund disbursement for biodiesel was claimed to have an only subtle impact on smallholder. ii) Palm oil smallholder's population Mapping remains questionable as there are around 40% of the current population. iii) Smallholders Replanting Programme (PSR) realization. iv) Smallholder incompliance to GAP (good agricultural practices) and ability to be certified (ISPO/RSPO). v) Forest Fires anticipation in the upcoming S2 (Q3-4) due to the dry season. We also hope that the government supports the rejuvenation for the smallholders' plantation for them to increase good aggregate practices so they can attain the ISPO/RSPO certification. I would like to stress again between the realization of CPO production tonne/hectares between the actual realization; the gap is still high. If our national average is 3.4 and the variety is around 6-8 tonne/hectare, this has been going on for a long time now since early 1980. The productivity of palm oil is quite different and slowly compare to rice plantation. There’s a policy being introduced in 1980 and they have improved the production. We hope this can be enjoyed by the palm oil plantation and that we can dive into good agricultural practices for palm oil after the pandemic. At the end of this year, we are entering the dry season thus we will face forest fire which is very much directed to the palm oil factory.

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Palm Oil Today Indonesia

Industri 4.0 di Pabrik Minyak Kelapa Ditulis oleh Hong Wai Onn, Insinyur Teknik Kimia Profesional, Malaysia


alaupun kita masih belum berpindah-pindah dengan roket di punggung kita, namun kehidupan dalam beberapa tahun ini masih sangat berbeda bahkan dengan sepuluh tahun yang lalu, terutama dengan perkembangan teknologi dan penemuan-penemuan yang kita lihat setiap tahun. Dalam dekade terakhir, menggunakan aplikasi untuk memesan transportasi ataupun mengirim uang ke teman-teman anda atau membeli segala sesuatu hingga pakaian, pengiriman makanan, bahan makanan, dan banyak lagi telah menjadi hal yang biasa dan berbicara dengan pengeras suara untuk menyalakan lampu, memainkan lagu, atau membacakan resep menjadi hal yang normal. Kita memang bener sedang berada di ambang revolusi teknologi yang akan merubah cara kita hidup, bekerja dan berhubungan satu sama lain secara mendasar. Sebelum kita telusuri lebih dalam, mari merefleksikan perkembangan revolusi industri. Revolusi Industri Pertama menggunakan air dan uap sebagai penggerak mesin produksi. Yang Kedua menggunakan tenaga listrik untuk berproduksi secara massal. Yang Ketiga menggunakan perangkat elektronik dan informasi teknologi untuk mengotomasi produksi. Dan pada saat ini Revolusi Industri Keempat dibangun di atas fondasi dari yang Ketiga, revolusi digital yang telah berlangsung sejak pertengahan abad terakhir. Ciri-cirinya adalah perpaduan teknologi yang menghilangkan batas antara fisik, digital dan biologi. Jelas bahwa masa depan teknologi akan terus merevolusi kehidupan kita. Meskipun saya juga tidak tahu persis bagaimana hal itu akan terjadi, namun satu hal yang pasti kita, terlebih lagi industri kelapa sawit, tidak dapat berpaling dari gelombang perubahan. Industri minyak kelapa sawit merupakan kontributor yang signifikan terhadap ekonomi Malaysia dan dalam perihal sumber daya alam berada di peringkat kedua di bawah minyak dan gas. Total ekspor minyak kelapa sawit Malaysia dan turunannya menghasilkan 64.8 miliar Ringgit Malaysia (atau 3.5 persen dari produk domestik bruto) kepada negara di tahun 2019. Untuk berkembang dan tetap kompetitif secara global dan tetap relevan, industri pengolahan minyak kelapa sawit khususnya harus mengadopsi dan melengkapi dirinya dengan teknologi dan inovasi terbaru. Teknologi baru seharusnya menjadi katalis untuk modernisasi seluruh industri, membuatnya menjadi lebih produktif dan efisien sambil meningkatkan pertumbuhan dan penambahan nilai. Saya percaya sangat penting bagu industri untuk terus bergerak maju menuju otomatisasi dan memanfaatkan Industri 4.0, bagian dari Revolusi Industri Keempat yang berhubungan dengan industri tersebut. Penerapan Industri 4.0 tidak hanya akan meningkatkan efisiensi operasional industri pengolahan minyak kelapa sawit secara keseluruhan namun juga menghasilkan pengembangan yang berkelanjutan, di mana presisi dari operasional terlihat dari pengurangan tenaga kerja, pengurangan resiko persediaan, keamanan proses, kualitas dan kontaminasi, serta peningkatan produktivitas.

sekali peningkatan dan perubahan berbagai unit operasional di pabrik pengolahan minyak kelapa sawit Malaysia, tetapi mereka belum mengalami perubahan yang signifikan semenjak publikasi laporan Mongana oleh ilmuwan Kongo pada tahun 1950-an. Masih ada ruang untuk perkembangan, terutama di bagian kontrol proses dan otomatisasi. Ketika saya menjadi dosen tamu di universitas lokal belum lama ini, seorang mahasiswa teknik kimia bertanya kepada saya mengapa industri pengolahan minyak kelapa sawit jauh tertinggal dari Industri 4.0. Ini sungguh pertanyaan yang bagus. Banyak alasan yang bisa menunda revolusi, tetapi saya berharap bukan disebabkan oleh keengganan berubah. Ada orang yang mungkin akan menolak perubahan karena mereka merasa nyaman dengan margin keuntungan yang ada dan merasa mempertahankan level pada saat ini lebih mudah. Namun kenyataannya ketika kita sedang duduk nyaman berpikir bahwa semua sedang baik-baik saja (misalnya kita adalah perkebunan biji minyak yang paling efisien pada saat ini, kita lebih unggul daripada minyak nabati dan minyak kelapa sawit yang lain), kompetitor kita baru saja membeli mesin baru untuk perahu motor mereka (misalkan hasil panen kedelai di negara-negara penghasil utama meningkat 20 persen dalam 15 tahun terakhir), dan kita bukan hanya ketinggalan, kita juga sudah melenceng dari target. Saya menyukai buku yang merincikan kegagalan dibandingkan dengan buku yang berisi kisah sukses. Biarkan saya berbagi satu cerita tentang kegagalan di dunia bisnis. Kodak adalah raja di dunia fotografi. Secara umum, Kodak menemukan fotografi pada abad ke-20. Mereka menyempurnakan teknologinya dan pada tahun 1990-an kios Kodak dapat ditemukan di mana-mana. Lalu, pada akhir tahun 1990-an fotografi digital mulai menjadi sebuah tren, dan Kodak memilih untuk menghiraukannya. Ada yang akan mengatakan begitulah nasib pemain “lama�, tetapi Nikon dan Canon merangkul perubahan digital dan muncul sebagai pilihan unggulan lagi, sementara Kodak yang terus menerus mengabaikan teknologi baru tersebut akhirnya menyatakan bankrut pada tahun 2012. Meskipun perusahaannya masih ada hingga saat ini, anak-anak muda mungkin tidak ada mengenali nama tersebut. Banyak orang akan mengatakan bahwa ini adalah kasus yang jarang terjadi di mana Kodak gagal melihat peluang baru dan beradaptasi. Benarkah demikian? Bagaimana dengan Yahoo!, Nokia dan BlackBerry?

Sudah jelas kita perlu berubah Sudah terbukti kalau perubahan pasti terjadi. Namun apakah industri pengolahan minyak kelapa sawit sudah siap menghadapi perubahan? Dengan menggunakan ilmu pengetahuan dan teknologi melalui PORIM (Palm Oil Research Institute of Malaysia) dan pada saat ini melalui MPOB (Malaysian Palm Oil Board), ada banyak



Palm Oil Today Indonesia

Merangkul Industri 4.0 di pabrik pengolahan minyak kelapa sawit Perlu ada perubahan paradigma dan saya percaya kita harus bekerja sama membentuk masa depan pengolahan minyak kelapa sawit yang mengutamakan manusia, memberdayakan mereka dan terus menerus mengingatkan diri kita bahwa mengingatkan diri kalau teknologu diciptakan oleh manusia dan untuk manusia. Misalnya, untuk menyederhanakan lingkungan kerja, mengurangi upaya manusia, mengurangi resiko keselamatan, dan lain-lain. Saya mengakui bahwa dalam penelitian industri dan pengembangan, komersialisasi bukanlah hal yang terutama dikarenakan adanya resiko. Pelaku industri perlu memiliki pola pikir yang inovatif sambil mempertimbangkan resiko teknis dan masa pengembangan. Para pengolah perlu diedukasi dan diajak melihat ada banyak solusi di luar sana untuk masalah yang konvensional. Para peneliti dan universitas-universitas harus lebih sering melibatkan para pengolah pada tahap pengembangan untuk mengurangi penundaan. Pada saat ini ada kekurangan dana untuk penelitian dan beberapa universitas meneliti dampak ekonomi terlebih dahulu dengan mencari mitra industri terlebih dahulu. Sementara industri pengolahan minyak kelapa sawit berada di belakang industri penyulingan dan oleokimia dalam hal Industri 4.0, dan sungguh memberikan harapan melihat adanya inisiatif yang dimulai. Sime Darby Plantation telah membangun contoh pabrik pengolahan dengan sensor, alat kontrol, dan spektrofotometer infra merah jarak dekat. Pabrik ini juga menggabungkan teknologi pengawasan dan akuisisi data yang pada saat ini jarang ditemukan di pabrik pengolahan minyak kelapa sawit dan akan membwa industri ke tingkat Industri 3.0, serta berpotensi naik hingga level Industri 4.0. Ada juga contoh pabrik pengolahan minyak kelapa sawit yang dibangun oleh Novozymes Malaysia, sebuah perusahaan bioteknologi global yang berkantor pusat di Bagsværd, di luar Kopenhagen, untuk melakukan percobaan solusi biologi mereka dan mempelajari aliran keseimbangan massa. Mereka juga menggunakan alat digital dan teknik analisis data untuk meneliti proses pengolahan minyak kelapa sawit di pabrik contoh ini. Saya percaya bahwa ini adalah langkah yang tepat untuk industri. Kita seharusnya tidak hanya berinvestasi pada infrastruktur teknis dan kemampuan analisa data, namun menciptakan sistem pengendalian yang cerdas namun sederhana.

Pabrik-pabrik gelap? “Pak, seperti apa tampak industri di masa depan?” tanya seorang mahasiswa pada saat saya mengakhiri pengajaran saya mengenai Industri 4.0. Saya masih ingat betapa bingungnya mereka pada saat saya menjawa pertanyaan dengan sebuah layar hitam. Saya memberi tahu para mahasiswa, “Pabrik-pabrik gelap mungkin akan menjadi masa depan!” tambah saya, “pabrik-pabrik di masa depan akan beroperasi 24 jam setiap hari dalam kondisi gelap. Mereka tidak memerlukan penerangan karena pekerjanya adalah robot yang diprogram.” Meskipun saya tahu hal ini tidak mungkin terjadi di pabrik minyak kelapa sawit dalam semalaman, Saya berharap kita bisa menyaksikan langkah perubahan revolusi industrim seperti yang telah saya bayangkan selama ini. Sementara ada kisah sukses dalam mengukur kadar minyak minuman keras menggunakan alat analisa infra merah jarak dekat (untuk tujuan mengontrol tingkat dilusi), kita harus memanfaatkan pelajaran ini pada aliran proses yang lain. Saya selalu percaya bahwa suatu hari kita dapat membahas secara ilmiah mitos potensi minyak kelapa sawit yang telah membingungkan industri selama beberapa dekade. Pabrik pengolahan minyak kelapa sawit bisa sepenuhnya diotomatisasi untuk mengurangi upaya manusia, dan juga mengurangi resiko keselamatan karena pekerja akan beroperasi dari ruang kontrol. Alat digitalisasi hars diadopsi untuk membuat keputusan yang lebih baik dan mempermudah pekerjaan kita. Hal ini akan meningkatkan produktivitas dan mengurangi biaya. Tidak mungkin terus menerus ditekankan betapa pentingnya Industri 4.0. Kita perlu mengembangkan pemimpin dengan keterampilan untuk mengatur pabrik pengolahan dan organisasi untuk melalui perubahan drastis ini. Sebagai profesional, kita perlu merangkul perubahan dan sadar kalau pekerjaan kita pada hari ini akan sangat berbeda pada masa depan yang tidak terlalu jauh. Sistem pendidikan dan pelatihan kita perlu beradaptasi agar dapat lebih baik mempersiapkan tenaga kerja dengan hal yang mereka perlukan di tempat kerja pada masa depan, yaitu fleksibilitas dan keterampilan untuk berpikir kritis. * Hong Wai Onn adalah seorang insinyur teknik kimia profesional ** Ini adalah opini pribadi penulis ataupun perusahaan publikasi dan tidak selalu mewakili pandangan Palm Oil Today Indonesia.


We may not be zipping around with rockets on our backs, but life in recent years is still remarkably different than it was even a decade ago, especially with constant technological advances and inventions coming out every year. In the last decade, using an app to hail a ride or send money to your friends or make purchases for everything from clothes, food delivery, groceries, and more has become commonplace and talking to smart speakers to turn on lights, play music, or read recipes seems normal. We are indeed standing on the brink of a technological revolution that will fundamentally alter the way we live, work and relate to one another. Before we move on, let’s reflect on the industrial revolution development. The First Industrial Revolution used water and steam to mechanise production. The Second used electric power to create mass production. The Third used electronics and information technology to automate production. And now the Fourth Industrial Revolution is building on the Third, the digital revolution that has been occurring since the middle of the last century. It’s characterised by a fusion of technologies that is blurring the lines between the physical, digital, and biological spheres. It’s obvious that the future of technology will continue to revolutionise our lives. While I do not yet know just how it will unfold, but one thing is clear we, especially palm oil industry, can’t run away from the waves of change. The palm oil industry is a significant contributor to the Malaysian economy and in terms of natural resources is second only to oil and gas. Total exports of Malaysian palm oil and its downstream derivatives in 2019 generated RM64.8 billion revenue (or 3.5 per cent of the gross domestic product) to the country. To progress while remaining globally competitive and relevant, palm oil milling industry particularly must adopt and equip itself with the latest technologies and innovations. New technologies should be the catalyst for modernisation of the whole industry, making it more productive and efficient while enhancing growth and value addition. I believe it’s important for the industry to move towards automation and capitalise on the Industry 4.0, the subset of the Fourth Industrial Revolution that concerns industry. The adoption of Industry 4.0 will not only enhance the overall operational efficiency of the palm oil milling industry but also result in sustainable development, where precision operation is evident in the form of reduced labour inputs, reduced risks in stocks, process safety, quality and contamination, and improved productivity.

It’s obvious we need to change It’s evident that change is the only constant. But is the palm oil milling industry ready for the change? By placing science and technology through PORIM (Palm Oil Research Institute of Malaysia) and later until today MPOB (Malaysian Palm Oil Board), there were many incremental improvements and changes in various unit operations in Malaysian palm oil mills, but they have not changed significantly since the publication of Mongana report by a team of scientists in Congo in the 1950s. There is still room for improvement, especially on process control and automation. When I guest lectured at a local university not long ago, a chemical engineering student asked me why palm oil milling industry is lagging behind when it comes to Industry 4.0. This is indeed a good question. Many reasons could procrastinate the revolution, but I hope it is not because of reluctance. Some people may resist change simply because they could be complacent due to the high profit margin and feel maintaining the status quo is easier than rocking the boat.


Palm Oil Today Indonesia

But the truth is while we are sitting comfortably thinking that everything is coasting along fine (e.g. we are ahead of the curve compared to other vegetable oils and oil palm is by far the most efficient oil seed crop in the world), our competition has just brought a new engine for their speed boat (e.g. soybean yield has been increased by more than 20 per cent in the past 15 years in key producing countries), and we’re not only getting left behind, we are drifting off course. I like books that detail failures as more as books that detail success. Let me share with you a failure story from the business world. Kodak was the king of photography. By and large, Kodak invented the photography as we knew it in the 20th century. They perfected the technology and by the 1990s a Kodak kiosk was pretty much on every corner of every city around the world. Then, in the late 1990s digital photography started becoming a thing, and Kodak completely ignored it. Some would say that’s the fate of all “old” players, but Nikon and Cannon embraced digital and emerged as top players again, while Kodak kept dismissing the new technology until in 2012 it filed for bankruptcy. Even though the company is still around, young kids probably won’t even recognise this name. Many people would say this might be an odd case here and there where Kodak failed to spot new opportunities and adapt. Really? How about Yahoo!, Nokia and BlackBerry?

There is also another palm pilot mill built by Novozymes Malaysia, a global biotechnology company headquartered in Bagsværd outside of Copenhagen, to test their biological solutions and study mass balance flows. They also use digitalisation tools and data analysing skill to research the palm oil milling process in this pilot mill. I believe this is the right move for the industry. We should not only invest in technical infrastructure and data analysing capabilities, but also engineer a smart yet simple system for process control.

Dark factories? “Sir, what does the future industry look like?” asked a student when I was concluding my guest lecture on Industry 4.0. I remember how puzzling they were to me when I answered the question with a black slide. I told the students, “Dark factories could be the future!” I added, “factories in future will be operating 24 hours 7 days a week in the dark. They require no light as the workers are pre-programmed robot.” While I know this might not possible to realise in palm oil mills overnight, I hope we could at least witness a step change in technological revolution, just as I have daydreamed about. While there was a successful story in measuring press liquor oil content using Near-infrared analyser (for automatic dilution control purpose), we should capitalise this learning in other process streams. I always believe one day in future we can address scientifically the myth of total potential oil that has been puzzling the industry for many decades. Palm oil milling could also be fully automated to not only reduce human efforts, but also reduce safety risks as workers will be operating far from the control room. Digitalisation tools should be adopted for better decision making and make our work easier. This will lead to significant increase in productivity and can reduce costs. It is impossible to repeat too often that Industry 4.0 is important. We need to develop leaders with the skills to manage mills and organisations through these dramatic shifts. As professionals, we need to embrace change and realise that what our jobs are today might be dramatically different in the not too distant future. Our education and training systems need to adapt to better prepare people for the flexibility and critical thinking skills they will need in future workplace. * Hong Wai Onn is a chartered chemical engineer

Embracing Industry 4.0 in palm oil mills There needs to be a paradigm shift and I believe we should together shape the future of palm oil milling that works for all by putting people first, empowering them and constantly reminding ourselves that all of these new technologies are first and foremost made by people for people. For example, simplify the work environment, reduce human efforts, reduce safety risks, to name but a few. I acknowledge that in industry research and development commercialisation is not a priority due to the risk involved. Industry players need to have an innovative mindset bearing in mind technical risks and gestation period. The millers need to be educated and see there are many solutions outside of conventional answer. Researchers and universities should involve the millers at the developing stage to reduce the reservations. There is now less money for research and some universities do an economic impact first which includes finding an industry partner. While palm oil milling industry is trailing behind refinery and oleochemical industry in Industry 4.0, it’s indeed encouraging to see few initiatives have been originated. Sime Darby Plantation has built a pilot mill with a number of sensors, controllers, and near infrared spectrophotometer. This plant incorporates also supervisory control and data acquisition technology which is presently not widely used in palm oil mill and will bring the industry up to Industry 3.0, and potentially Industry 4.0, level.

** This is the personal opinion of the writer or publication and does not necessarily represent the views of Palm Oil Today Indonesia.



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