The Indonesian palm oil industry, an integral part of the global economy and a key player in national economic development, has recently been spotlighted for its role in generating productive employment, enhancing food and energy security, and supplying consumer goods. This has had a significant impact on reducing poverty levels among rural and smallholder farmers.
In light of the world’s projected population reaching 9.8 billion by 2050, an additional 200 million tons of vegetable oil production will be required. Indonesian Coordinating Minister for Economic Affairs Airlangga Hartarto, speaking at The 19th Indonesian Palm Oil Conference (IPOC) and 2024 Price Outlook, underscored that palm oil represents a sustainable and efficient method to meet this growing demand. The industry also supports environmentally friendly transport fuel options, such as sustainable aviation fuel, known as BioAvtur 2.4% or J2.4, developed by Indonesia.
To boost palm oil productivity, Indonesia has embarked on a replanting initiative, covering 200,000 hectares since 2007 and an additional 180,000 hectares in the current year, with a budget allocation of USD 386 million.
At the global level, the European Union’s Deforestation Regulation (EUDR) policy, aiming to limit deforestation caused by forestry and agricultural activities worldwide, will directly impact Indonesia’s key commodities, including palm oil, coffee, cocoa, rubber, soybeans, cattle, and timber.
Despite concerns, the Indonesian government is ready to collaborate with the European Union to establish a framework promoting sustainable agriculture, including vegetable oil production, in an inclusive, holistic, fair, and non-discriminatory manner. Minister Hartarto emphasized the importance of the EU recognizing and fully understanding that the national sustainability standards of producing countries could meet the requirements for accessing the EU market.
This stance by the Indonesian government not only reinforces its commitment to environmental stewardship but also highlights its dedication to maintaining a balanced approach to national economic development and global sustainability standards.
[Read the full press release from the Indonesian Coordinating Ministry of the Economy here]