Palm oil entrepreneurs in South Sumatra predict that crude palm oil production in the province could reach more than 4 million tons this year.
The chairman of the South Sumatra Indonesian Palm Oil Association (Gapki), Harry Hartanto, said that the increase in production could occur this year along with the rise of independent smallholders who plant.
“Even though the [garden] of the company is still replanting, many people plant it so that it can support the increase in production,” he said on Monday (1/14/2019).
Harry continued that the majority of oil palm companies in South Sumatra were rejuvenating land in their gardens.
Usually, he said, after replanting it could increase land productivity after 3 years of rejuvenation.
He added that 70% of the production is derivative products or downstream is no longer crude palm oil.
“Only 20% to 30% is CPO, the rest will be derivative products including biodiesel, cosmetic ingredients and others,” he said.
Meanwhile, based on the records of the South Sumatra Plantation Service, the average CPO price in the province for period I January 8-January 17, 2019 reached Rp. 6,040 per kg, while the average price of the sawait core was Rp. 4,333.99 per kg.
The price of fresh fruit bunches (FFB) purchased from farmers for the age of 10 years to 20 years is set at Rp1,287.92 per kg.