Agriculture Minister: 300 Companies Under Investigation for Failing to Raise Palm Oil Prices
The Minister of Agriculture, Andi Amran Sulaiman, stated that around 300 palm oil companies will be inspected because they have not increased the price of Fresh Fruit Bunches (FFB) to reflect current market conditions.
“Out of a total of 1,900 companies operating in the palm oil sector, approximately 300 are being targeted for inspection to determine why they have not raised prices to previous levels,” said the Minister following a Coordination Meeting on the Development and Price Stabilisation of Palm Oil FFB in Jakarta on Monday.
The Minister noted that his department has directly reported these 300 companies to the Indonesian National Police Food Task Force. This move serves as a supervisory measure against hundreds of palm oil companies that have yet to adjust their purchasing prices at the farmer level. The Ministry of Agriculture recorded that between 270 and 300 companies are still maintaining prices below expected levels.
Amran stated that the data will be submitted to the Police Food Task Force for further investigation. “They will be inspected immediately. Sanctions will not be imposed instantly; an investigation must occur first. We are issuing the letters today for inspection,” he emphasised.
He explained that the investigation is necessary to identify the reasons behind the failure to adjust prices. The government maintains that this step is essential to ensure farmers receive fair prices consistent with market conditions. However, the government will not impose immediate sanctions until the verification process is complete. Amran noted that some companies might have already raised prices, but such changes may not have been reflected in official reports. Therefore, the inspection will be conducted objectively based on verified data.
“We have also requested the Special Criminal Investigation Directorate to follow up specifically on FFB prices,” Amran added.
The government hopes all companies will promptly adhere to mutual agreements to restore FFB prices to safeguard the welfare of palm oil farmers. FFB prices vary by region and must comply with Governor Regulations (Pergub). “If the price is Rp3,200 per kg, it should remain at that level, but if it should be Rp3,600 per kg, it must return to Rp3,600 per kg based on the region, following the prices set by the Governor,” Amran said.
Minister Amran, accompanied by Deputy Minister of Agriculture Sudaryono, led the coordination meeting at the Ministry of Agriculture. The meeting involved palm oil associations, farmers, exporters, the National Police Food Task Force, and other relevant stakeholders.