IPB palm oil study centre stresses need to accelerate smallholder replanting programme

IPB University’s Palm Oil Study Centre has stated that accelerating the Smallholder Palm Oil Replanting Programme (PSR) is urgently needed, given that many smallholder oil palm plantations have reached old age—25 years or more—and their productivity is declining. According to the Head of the IPB University Palm Oil Study Centre, Professor Budi Mulyanto, in a statement in Jakarta on Saturday, this condition could affect the availability of raw materials for the national palm oil industry. A shortage of raw materials would negatively impact the success of the palm oil downstreaming programme, he continued, while downstream industry development must be aligned with strengthening the upstream sector of the national palm oil industry. “This palm oil replanting is very important. Currently, almost 50 percent of Indonesia’s oil palm is smallholder-owned and most of the plants are old. If they are not replanted, how can we talk about the downstreaming programme? Because production determines downstreaming,” he said. He explained that one way to encourage acceleration of the PSR Programme is to use an affirmative approach, whereby the policy can provide special treatment or facilities for smallholder farmers, particularly regarding various administrative constraints and land legality. “Accelerating the smallholder palm oil replanting programme requires affirmative policies related to land legality issues. These affirmative policies must be based on the principles of certainty, benefit, and justice,” said the IPB professor. Budi Mulyanto assessed that the performance of the Plantation Fund Management Agency (BPDP) has been quite good regarding the implementation of the PSR Programme. This good performance is judged by the benefits of the PSR programme for smallholder farmers, environmental sustainability, and the continuity of the national palm oil industry. He added that the distribution of support funds by BPDP for the implementation of the smallholder oil palm replanting programme is also very good because it applies the precautionary principle and responsible governance. “In providing funding support for the PSR Programme, BPDP has been very prudent. The precautionary principle applied by BPDP is very important,” he said. Meanwhile, the Head of International Relations of the Central Board of the Indonesian Palm Oil Farmers Association (DPP Apkasindo), Djono Albar Burhan, added that the PSR Programme implemented by BPDP provides positive benefits for farmers in increasing the productivity of smallholder oil palm plantations. According to him, the PSR Programme is a momentum for smallholder farmers to regenerate their crops while increasing production output through the use of certified seeds or seedlings and the application of better plantation management. “Amid declining productivity when oil palm plants are over 25 years old and productivity is below 10 tonnes per hectare per year, replanting is one solution to increase productivity,” he said. Djono expressed hope that there would be facilities for smallholder farmers regarding the PSR Programme requirements, as this would encourage acceleration of the palm oil replanting programme in Indonesia. According to him, cross-sector collaboration is needed, encompassing government at central to regional levels, to make it easier for smallholder farmers to participate in the PSR programme, as well as business certainty for smallholder farmers, particularly regarding land legality. Data from the Ministry of Agriculture records that realisation of the Smallholder Palm Oil Replanting (PSR) programme up to 11 May 2026 was only around 9,063 hectares, or 18.13 percent of this year’s PSR target of 50,000 hectares. The government has increased PSR funding support from Rp25 million to Rp60 million per hectare.