Forests open to new oil palm plantations

Forests open to new oil palm plantations

JAKARTA (JP): A new decree permits plantation companies to
establish oil palm estates in forest areas outside Riau and North
Sumatra.

Minister of Forestry and Plantations Sumahadi said in the
decree, dated April 8, that the forests must be located in
nonforestry planting areas and should be unoccupied or idle land
of more than 10,000 hectares.

The decree forbids companies to develop oil palm plantations
on small islands with widths of less than 10 square kilometers.

Allocated land for oil palm plantations should not be more
than 300 meters above sea level and have a maximum slope of 25
percent.

The land should get 1,750 millimeters to 4,000 millimeters of
rainfall annually, with the average temperature ranging between
24 and 29 degrees Celcius.

Soil depth should be more than 100 centimeters for mineral
land and less than 200 centimeters for peat.

"But the criteria will not apply in North Sumatra and Riau,
which have been closed to new plantations," Sumahadi told the
media after a meeting with executives of forest concession
holders and plantation firms last week.

Last month, the government announced that North Sumatra and
Riau provinces were barred from new plantation developments to
prevent a further decline in their forests.

Sumahadi said new investment in the plantation sector would be
directed to the country's eastern provinces where land resources
remained abundant.

"Forest areas in North Sumatra and Riau are almost fully
utilized. It is better and commercially more viable for new
investors to open plantations in eastern Indonesia," he said.

He added that the new decree was also aimed at convincing
foreign investors sector that developing palm oil in Indonesia
was profitable.

The government, following its agreement with the International
Monetary Fund in January, revoked a ban on new foreign investment
in the palm oil industry. It was imposed last year in a bid to
protect domestic companies and prevent excessive land acquisition
by foreigners.

Sumahadi said his ministry had converted 3.4 million hectares
of forests into plantation areas, 2.4 million of which were palm
oil estates.

He said his ministry had allocated more than four million
hectares of forests for oil palm plantations until 2000. (gis)