Indonesia: Over a thousand communities affected as oil palm conflicts escalate: Sawit Watch

Agrarian conflicts tied to palm oil plantations are intensifying across Indonesia, with Sawit Watch recording at least 1,126 communities involved in disputes with more than 385 oil palm in 22 provinces.

Achmad Surambo, Executive Director of Sawit Watch, told a public discussion held in Jakarta on Tuesday, April 29, 2025 that these conflicts are structural in nature and have been fueled by weak governance and ineffective conflict resolution mechanisms.

“Land disputes are the first wave of conflict, followed by a second wave involving failed and unfair partnership schemes,” Surambo said.

He cited that many smallholders are unaware of the size of their debts to banks or how much income they are actually entitled to under plasma partnership arrangements. “These schemes are often managed without transparency or accountability.”

Sawit Watch also highlighted stark land ownership disparities. “Sixty-five percent of palm oil land is controlled by large companies, while only 35 percent is managed by smallholder farmers,” Surambo said.

This inequality, he added, is exacerbated by inconsistent data between government agencies and poor coordination in enforcement and oversight.

Surambo further revealed that palm oil expansion is now moving eastward, targeting areas like East Nusa Tenggara and even Java — a region traditionally known as the country’s food production hub. “We’ve seen food-producing lands being converted into palm plantations, even in East Java,” he added.

He emphasized that the root of palm oil conflicts lies not only in legal violations but also in structural poverty. “Law enforcement alone isn’t enough. When local communities receive less than 10 percent of the economic benefits, resentment is inevitable,” Surambo said.

Indonesia’s palm oil industry is a major contributor to national revenue, yet it remains plagued by social conflicts, environmental degradation, and poor governance. Government estimates suggest that national palm oil plantation coverage currently stands at 17.3 million hectares.

However, according to Sawit Watch, the total land involved in licensing processes may reach 25.3 million hectares — indicating a large gap between what is legally permitted and what is actually occupied.

Mandatory partnership schemes, in which companies are required to allocate 20 percent of their plantation land to smallholder farmers (plasma), have frequently failed or been managed in non-transparent ways. A moratorium on new permits implemented in 2018 was intended to curb expansion but has shown limited effectiveness due to weak enforcement.

Ecologically, Sawit Watch estimates that Indonesia’s maximum sustainable limit for palm oil land is around 18.3 million hectares. “We are on the edge. Further expansion will put serious strain on the environment and local livelihoods,” Surambo said.

He called for full transparency in land ownership data, meaningful community involvement in licensing decisions, and sweeping reform of plantation governance.

“If the government is serious about resolving these conflicts, it must be brave enough to open up. There may be a spike in tensions at first, but in the long run, it will lead to greater stability,” he concluded.

Tags: Indonesia, palm oil, oil palm, smallholders, Plantations