{
    "success": true,
    "data": {
        "id": 1644689,
        "msgid": "palm-oil-investment-overshadowed-by-legal-uncertainty-1774889542",
        "date": "2026-03-30 19:48:11",
        "title": "Palm Oil Investment Overshadowed by Legal Uncertainty",
        "author": " ",
        "source": "GALERT",
        "tags": "",
        "topic": "Agriculture",
        "summary": "The palm oil industry in Indonesia is expected to face increasing challenges over the next one to two years due to higher entry barriers, complex legality requirements, and global market pressures, making it far less accommodating than in the 1980s and 1990s. Dr. Rio Kristiawan, an expert in business law and investment, highlights that non-integrated palm oil mills struggle with raw material supply, high costs for fertiliser, labour, and sustainability compliance, particularly affecting medium-sized enterprises squeezed between large corporations and small-scale operations. He predicts a trend towards industry consolidation, advising new entrants to scale up significantly or opt for small and medium enterprises (UMKM) to benefit from regulatory exemptions.",
        "content": "<p>Over the next one to two years, the business climate for palm oil is\nexpected to become increasingly challenging. Higher entry barriers,\ncomplex legality demands, and global market pressures make this business\nno longer as welcoming as in the 1980s and 1990s.<\/p>\n<p>That view was expressed by academic and business law and investment\nexpert, Dr.\u00a0Rio Kristiawan, in the Sawit Indonesia Podcast on Friday (23\nJanuary 2026). The man born in Kediri, East Java, now actively teaches\ncorporate finance, corporate law, environmental law, and business\nethics. He has also written more than 20 books before entering the\necosystem restoration business as Co-Founder and CEO of Pagatan Usaha\nMakmur (PUM).<\/p>\n<p>Rio compares the current situation to the past. \u201cIt used to be\nfriendly, with few demands. Now it\u2019s bloody tough. There are more\nplayers, but legality requirements and market demands have also\nincreased,\u201d he said.<\/p>\n<p>According to him, palm oil mills (PKS) that are not integrated with\ncore plantations face issues with fresh fruit bunch (TBS) supply.\nReliance on external parties makes it difficult to control raw material\nprices and squeezes business margins. He cited the situation in\nRangkasbitung, where TBS prices were low because several PKS did not\nhave their own plantations.<\/p>\n<p>\u201cFertiliser costs, labour, and indirect costs are quite substantial.\nPlus, meeting sustainability requirements is not easy,\u201d he said.<\/p>\n<p>The heaviest pressure, Rio continued, is felt by medium-scale\nbusiness players. Large corporations enjoy economies of scale that\nreduce costs per hectare, while small businesses receive certain\nregulatory exemptions. In between, medium-sized companies must bear high\ncosts with the same legal obligations.<\/p>\n<p>\u201cIf you\u2019re big, the cost per hectare is lighter. But the ones that\nsuffer are those that are neither small nor big\u2014this is the bloodiest.\nEspecially if they don\u2019t have their own mill or CPO facilities,\u201d he\nexplained.<\/p>\n<p>He sees the industry trend moving towards consolidation. \u201cIf you want\nto enter, go big. If you\u2019re in between, better to be UMKM because there\nare certain regulatory exemptions,\u201d he said.<\/p>",
        "url": "https:\/\/jawawa.id\/newsitem\/palm-oil-investment-overshadowed-by-legal-uncertainty-1774889542",
        "image": ""
    },
    "sponsor": "Okusi Associates",
    "sponsor_url": "https:\/\/okusiassociates.com"
}