Indonesia’s palm oil output may decline amid ownership transition to Agrinas Palma
The Indonesian Palm Oil Association (GAPKI) stated that the volume of crude palm oil (CPO) output this year could contract due to the transfer of ownership to State-owned PT Agrinas Palma Nusantara.
If the transition period for operating oil palm plantations is too long, maintenance and fertilization activities cannot be carried out according to schedule.
“This condition could ultimately reduce production volume in the second half of 2025,” GAPKI Chairman Edi Martono, said as quoted by Katadata.co.id, on Wednesday, March 26, 2025.
The Forest Area Recognition Task Force (Satgas PKH) plans to hand over management of around 217 thousand hectares (ha) of forest areas reclaimed to Agrinas Palma. All of the land was previously owned by 109 palm oil companies.
The PKH Task Force has also handed over 221 thousand hectares of palm oil land previously controlled by Duta Palma Group to Agrinas. This land was confiscated during the investigation into the corruption case of Duta Palma Group’s palm oil plantation business activities.
“There is no clarity regarding the land that will be operated by Agrinas Palma, such as the land owned by Duta Palma which has only reached the clarification and stake installation stage, and has not yet reached the stage of confiscation by the state,” Edi said.
Coordinating Minister for Food Affairs, Zulkifli Hasan, previously said that Agrinas Palma will manage 1 million hectares of oil palm plantation as part of an ongoing strategic project.
“For the initial stage, 221 thousand hectares of land will begin to be managed, of which 145,000 hectares need improvement and the rest will be planted again because they are still idle,” Zulkifli said on Monday, March 25, 2025.
Initially, the government prepared a capital injection of Rp8 trillion (US$483,6 million) in the 2025 State Budget (APBN) to support Agrinas. However, Minister of Investment and Downstream Rosan Perkasa Roeslani revealed that funding would be diverted through the Daya Anagata Nusantara Investment Management Agency (BPI Danantara), not from the APBN.
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