Domestic palm oil producers, experts and potential investors will focus on biodiesel production, trade certification and increasing palm oil output during an upcoming international conference in Jakarta.
Representatives from the palm oil industry will push for these points to be addressed during the fifth annual International Conference and Exhibition on Palm Oil (ICEPO) from May 26 to 28.
Indonesian Plantation Entrepreneurs Association (GPPI) chairman Soedjai Kartasasmita said the production of biofuel was the top priority to provide a solution to the country’s energy problems, such as high oil imports and ballooning fuel subsidies.
“What we need now is research, funded by the government, to harness palm oil full potential. We must not focus on palm oil [solely in its main form]; we also need to look at its wider potential,” Soedjai said at an ICEPO press conference on Monday.
Soedjai, who is also the chairman of the ICEPO advisory board, emphasized that in order for biofuel to compete in the energy market, the government had to provide funding for research.
“Right now, if you compare the price of biofuel with subsidized fossil fuel, biofuel cannot compete and, therefore, it cannot be fully developed. In order to harness palm oil’s potential as an energy source, the government must provide the industry with incentives,” he added.
Soedjai urged the new administration to pay attention to the needs and the development of the palm oil industry.
According to data from the Biofuel Producers Association (Aprobi), the predicted uptake for domestic biofuel in 2014 is 3 million kiloliters or 18.87 barrels. Last year, the country produced more than 1 million kiloliters or 6.33 barrels of biofuel.
Soedjai also explained that due to palm oil’s potential as an energy source, it could relieve state-owned electricity company PT PLN of the burden of supplying electricity to communities around oil palm plantations.
He also said that the industry should no longer focus on land expansions.
Regarding international trade certification, Soedjai said the country faced major challenges in trading palm oil with countries in Europe, as the latter required palm oil producers to have a certificate showing the product was produced and processed sustainably.
This, he added, may be one of the reasons why the palm oil industry had a poor image both domestically and internationally.
“One of the aims of the ICEPO is to discuss how to raise awareness on the importance and positive benefits of palm oil for social welfare and the environment,” he said.
According to data from the Roundtable on Sustainable Palm Oil (RSPO) Indonesia, the amount of palm oil produced with RSPO certification is around 9.7 tons, 47.85 percent of which originates in Indonesia. Soedjai said this showed the commitment toward developing an environmentally friendly industry, and that further research was needed.
Since 2011, Indonesia has implemented a palm oil production standard, Indonesian Sustainable Palm Oil (ISPO), which all producers are obligated to follow.
Meanwhile, ICEPO advisory board deputy chair Delima Hasri Darmawan said the country’s palm oil production in the second half of the year may suffer a decrease, due to the anticipated El Niño effect.
