Maintaining Palm Oil Price Stability

JAKARTA, VIVA – The dispute over plummeting fresh fruit bunch (FFB) prices for palm oil farmers has resurfaced in recent weeks. The price decline was triggered by panic among some industry players following the transition to a single-channel export policy and palm oil mills (PKS) purchasing below the reference price. Small-scale farmers without partnerships with companies or processing plants have been most affected. In several regions, FFB prices plummeted well below government-set rates. Amid scrutiny of hundreds of private PKS, PTPN IV PalmCo, a subsidiary of state-owned PTPN III (Persero), has assured that FFB purchases from the public continue under standard procedures. PTPN IV PalmCo President Director Jatmiko K. Santosa stated that the company has absorbed approximately 1.03 million tonnes of FFB from the public and partners until April 2026, a 2.52 per cent increase compared to the same period last year. Jatmiko added that sustained FFB absorption is crucial for maintaining economic circulation in palm oil plantation hubs. ‘This increase in absorption volume aligns with clear quality standards. Our crude palm oil (CPO) recovery rate has remained at 18.69 per cent as of April 2026,’ he said. Arya Sandhiyudha, PTPN IV PalmCo’s Director of Institutional Relations, added that the company continues to coordinate with regional agriculture offices to ensure price regulations are implemented per government guidelines. He stated that state-owned enterprises in the palm sector are not solely business-oriented but also serve to stabilise trade when markets experience volatility. ‘PTPN IV PalmCo continues to coordinate with agriculture offices to ensure implementation of Ministry of Agriculture Regulation No. 13 of 2024. State-owned enterprises must act as fair price references and market stabilisers, especially during periods of volatility,’ Arya said. FFB prices received by farmers are primarily set through provincial price formulation teams involving local government, palm oil processing companies, and farmer representatives. This scheme is designed to ensure FFB prices reflect crude palm oil (CPO) and downstream product trends while protecting farmers from unfair purchasing practices.