PALMOILMAGAZINE, JAKARTA — The government’s decision to take over problematic palm oil plantations deserves strong appreciation. This policy serves as a stern warning to private companies—both domestic and foreign—and local authorities to stop arbitrarily converting forest areas into plantations. It’s time to move beyond “maps on paper” and “envelopes that talk” in decision-making. Nature can no longer bear the cost of human negligence.
According to data revealed by Head of ATR/BPN Nusron Wahid (Kompas.com, Feb 24, 2025), around 1.1 million hectares of palm plantations have been confiscated out of a total 3.7 million hectares identified as problematic. The figure could climb to nearly 4 million hectares. Plantations already under the supervision of the Forest Area Enforcement Task Force (PKH) will no longer be managed as before, inevitably affecting productivity.
The vast spread of seized land—from Central and East Kalimantan to Riau, Jambi, South Sumatra, and North Sumatra—requires meticulous reorganization. Each province should have its own management office to ensure operational efficiency and keep revenue circulating locally, strengthening regional economies.
Economic Scale and Management Challenges
Ideally, no company should manage more than 500,000 hectares, roughly equivalent to 100 plantations of 5,000 hectares each. Beyond this threshold, efficiency and oversight deteriorate rapidly. Each hectare contains about 130–135 oil palm trees—each a living “oil factory” requiring care from roots to fruit.
A company managing 500,000 hectares is essentially responsible for 65 million trees. Managing such a scale demands robust systems, skilled human resources, and advanced technology. Unfortunately, in many cases, expansion has outpaced technical and social preparedness.
To illustrate: one plantation assistant might lead 80 workers, managing assets worth Rp62.5 billion. A plantation manager oversees Rp625 billion, while corporate directors control assets up to Rp62.5 trillion and 85,000 employees. This is far beyond just planting and harvesting—it’s a complex enterprise requiring discipline, competence, and integrity.
Social and Technical Obstacles
The creation of PT Agrinas Palma Nusantara to manage seized plantations is bold but not without risk. Integrating different work cultures, legacy systems, and human resources is a formidable task. Building cohesion and a shared work ethic can take four to five years.
Agronomically, differences in plant conditions, tree density, and productivity demand tailored management strategies. Continuous training, capacity building, and cross-regional knowledge exchange are essential.
However, the most pragmatic solution may be to integrate confiscated plantations into existing PTPN subsidiaries. For instance, plantations in North Sumatra could merge with PTPN I–IV, in Riau with PTPN V, and in Jambi with PTPN VI. PTPN already possesses strong infrastructure, management systems, and skilled personnel, consistently achieving top productivity nationwide.
Toward a New Governance Model
Each entity should ideally manage no more than 600,000 hectares. If the scale exceeds this, new companies—such as PT Agrinas Palma Nusantara 1 and 2—can be established, supported by structured recruitment and training programs. In Kalimantan, PTPN XIII could focus on West and South Kalimantan, while Agrinas Palma Nusantara handles East and Central Kalimantan. Meanwhile, new entities like PT Agrina Nusantara 2 could oversee eastern regions such as Sulawesi, Maluku, and Papua.
PalmCo, as the holding company, can adapt to this structure, particularly in Aceh and North Sumatra. Leadership appointments must be based on performance records—not political influence. Professionalism and integrity are essential to meet President Prabowo’s vision of higher BUMN dividends.
Economic Potential and Social Impact
If the 3.7 million hectares of seized land are managed effectively, the total BUMN plantation area would surge from 573,000 to 4.27 million hectares—around 25% of the national total. With an average FFB yield of 23 tons per hectare per year, an oil extraction rate of 23%, and a combined CPO+PKO price of Rp12,000/kg, each plantation company could generate Rp38 trillion in revenue, with a gross profit of around Rp23 trillion.
Across nine state-owned plantation companies, potential dividends to the state could exceed Rp30 trillion annually—a 1,000% increase from 2024. Furthermore, over two million new jobs could be created directly and indirectly in the sector.
The government’s seizure of problematic palm oil estates marks a golden opportunity to reform this strategic industry. Through professional management, transparent governance, and a sustainability-driven approach, Indonesia can build a palm oil sector that not only benefits the state but also protects the environment and uplifts communities.
It’s time for the palm oil industry to be a symbol of progress, not controversy—transforming once-problematic plantations into the foundation of an ethical, sovereign, and sustainable future.
Author: Memet Hakim – Social & Plantation Analyst
Disclaimer: The views expressed are solely those of the author and do not necessarily reflect those of beige-heron-208544.hostingersite.com.
