Palm Oil Industry Leader Outlines Obstacles to Indonesia's Smallholder Palm Replanting Programme
Jakarta — The chairman of the Indonesian Palm Oil Producers’ Association (Gapki), Eddy Martono, reported to Agriculture Minister Amran Sulaiman regarding the Smallholder Palm Replanting Programme (PSR), which is currently progressing slowly. One of the main causes is farmers’ reluctance to fell their productive oil palm trees.
This was conveyed by Eddy after meeting with Agriculture Minister Amran at the Ministry of Agriculture’s office in Jakarta on Wednesday, 11 March 2026.
During the meeting, he explained that national palm oil production has actually increased, though greater production growth potential remains constrained by slow replanting in smallholder plantations.
“In today’s meeting with the Minister, first I reported on our palm oil conditions. We are grateful that in 2025 there has been an increase in production. From CPO (Crude Palm Oil) that is approximately 51 million tonnes, or in total production with PKO (Palm Kernel Oil) it is 56 million tonnes,” said Eddy.
According to him, the increase in production occurred because some company plantations that were previously replanted are beginning to enter production. However, the Smallholder Palm Replanting Programme (PSR) at the farmer level is not running optimally.
“So I then explained why this is increasing? Because it is indeed the result of company replanting, which has now begun to produce. However, I mentioned that there are still obstacles. Production should be far above this if the Smallholder Palm Replanting Programme (PSR) were running well. Currently, the PSR can be said to be stagnant,” he said.
Eddy explained that the main obstacle is not merely a matter of licensing or administration. Rather, many farmers prefer to maintain their oil palm trees because they still generate income.
“I also mentioned to the Minister that the problem is not just a licensing issue; the problem is sometimes the farmer is reluctant. For example, now with fresh fruit bunch prices at Rp 3,000 per kilogramme, they do not want to fell their plants,” he explained.
According to Eddy, farmers’ greatest concern is losing their income source during the waiting period until the new plants return to production.
“So they say, ‘What will I eat if I fell my plants?’” he said.
He believes there needs to be a solution to guarantee the sustainability of farmers’ livelihoods during the plantation renewal period. One option discussed was support for living costs while waiting for the new plants to start producing.
“This is what needs to be resolved. What is the way out? Whilst waiting… oil palms nowadays are quite fast, in 2.5 years they are already producing. So there should ideally be a livelihood guarantee, besides intercropping for instance,” said Eddy.
“I mentioned this to him, and the Minister agreed. So later we will discuss how our production can increase far more than currently,” he added.
Eddy believes the issue needs to be a joint effort between the government and industry players. Without a solution for farmers, the smallholder palm replanting programme will continue to progress slowly.
“Yes, I proposed to him that this is our shared responsibility, Sir, between us and the Minister, that first, the farmer’s reluctance to cut must be supported with living costs whilst they wait. So where does that money come from, we will think together. Whether it comes from export levies or from wherever we think together, but this is important for the PSR,” he said.
According to him, older oil palm plants do indeed need to be replaced to maintain productivity. However, without a clear support scheme, farmers tend to delay replanting.
“To be honest, farmers have not made any proposal. But I see here, they will definitely… they do not want to, they will certainly say ’what will I eat? That is what we need to solve together,” he said.