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Indonesia remains the choice location for oil palm cultivation. Despite the constant disruptive changes in terms and regulations, plantation companies from across the world including China, India and Malaysia are flocking to Indonesia to acquire additional green fields or existing oil palms plantations.
Since 2007, Indonesia has taken over Malaysia's spot as the world's leading producer of palm oil with a total of approximately 20 million tons of
crude palm oil (CPO) production out of which approximately 50% of the plantations belong to Malaysian companies.
Limited agriculture land in Malaysia will continue to make Indonesia attractive for planters to expand their land bank.
While there is interest among planters, there are incidents of investors pulling out of Indonesia oil palm scene simply because of the operational challenges and discouraging returns on investments.
What are the key criterias to expand in Indonesia? Is finding the right Indonesian partner the only solution to long-term success?
Indonesian has hopes to produce up to 40 million tons of palm oil in the year 2020. According to Ir Achmad Mangga Barani the Director of Estate Crops, Ministry of Agriculture, the world market right now is interested in palm oil, especially for food and contributes 34% of the food oil. In the future it should be 50%. Second, the palm oil is used for biofuel, especially in the European countries.
40 million is a big ambition, as environmentalists and consumer groups campaign to ban palm oil citing unsustainable practices and deforestation reasons. Cadbury New Zealand recently said it would exclude palm oil from its chocolate bars following an uproar by consumers. On the other hand, sustainable palm oil has proved to be a hard sell, with retailers shunning the product due to its higher price over unsustainable oil.
How are palm oil manufacturers responding to this challenge? Throwing woes to the already beleaguered industry is latest announcement from the World Bank to halt funding to the industry until a complete review on the environmental performance of investments in this sector and a clear strategy is put in place.
Whether you are a new investor or already have plantations, CMT's timely Sustainable Oil Palm Plantation conference will prepare you for the
latest insights on the industry.
Sign up now and enjoy group discounts, For an updated programme, visit us at www.cmtevents.com. Send your enquiries to Sasha@cmtsp.com.sg
You will network with
Plantation Cos, Agriculture Industry, Inspection & Quality Testing Cos,
Investors, Plantation Analysts, Government & Private Financial Institutions,
Commodities traders, Government Officials for Estate Crops/Agriculture,
Palm Oil Associations, Planters