Government Preparing CPO Policies
Monday, 22 January, 2007 | 16:28 WIB

TEMPO Interactive, Jakarta: The government will revise its policies on crude palm oil (CPO) so that the product becomes a first-rank exported commodity without reducing domestic supplies.

Minister of Industry Fahmi Idris said that in order to develop downstream industries, five million tons of CPO per year will be required until 2010.

“One of the decisions from the meeting with the Vice President, was that oil palm as a commodity must be managed so that Indonesia has a good bargaining position,” he said Friday (01/19) in Jakarta.

According to him, Vice President Jusuf Kalla has appointed four ministers and Head of the Capital Investment Coordinating Body to discuss ways for Indonesia to become a major CPO producer.

The four ministers include the Industry, Agriculture, Trade and Finance Ministers.

“On Monday (01/22), a first echelon meeting will be held. Afterwards, ministerial meeting will be also held.”
According to Secretary General of the Department of Industry Agus Tjahajana, so far, there have been differences of opinion as to whether to prioritize exports or domestic needs.

Fahmi explained that for Indonesia CPO is extremely strategic.

The reason is because, together with Malaysia, Indonesia is capable of producing 86 percent of total world's production.

As of 2005, Indonesia controls an oil palm area of 5.5 million hectares and Malaysia 3.3 million hectares out of the total 9.12 million hectares of the world' oil palm areas.

However, Indonesia produced 13.5 million tons in 2005, whereas Malaysia managed to produce 15.7 million tons.

According to this politician from the Functional Group (Golkar) Party, 10 other matters will be discussed: land preparation, high-rank seeds stock, fertilizer stock, infrastructure existence, research and seeding facilities, special educational institution facilities, policies of CPO product allocation, fiscal policies, foreign marketing policies and forming of bilateral negotiator team.

Muhamad Fasabeni