Indonesia cracks down on companies suppressing palm prices

Jakarta (ANTARA) - President Prabowo Subianto has reportedly instructed a 10 percent increase in the price of fresh fruit bunches (FFB) from oil palm, in line with rising global crude palm oil (CPO) prices.

“The president is defending 15 million farmers, saying FFB prices must return to their original levels, and even increase by 10 percent,” Agriculture Minister Andi Amran Sulaiman said here on Monday.

According to him, the directive underscores the importance of protecting the welfare of around 15 million oil palm farmers by restoring FFB prices and encouraging further increases.

He said the adjustment is reasonable, supported by the upward trend in global CPO prices and the strengthening US dollar against the rupiah.

Sulaiman noted that around 70 percent of FFB prices across regions have gradually recovered, and that the government, together with the Food Task Force and police, will ensure full price normalization.

He added that the recent decline in farmgate FFB prices is considered an anomaly, as the commodity should have increased by about 10 percent in line with global market conditions.

The minister said that although global CPO prices have risen by 47 percent and the US dollar has strengthened by more than 10 percent against the rupiah, FFB prices at the farm level have instead fallen by around 17 percent.

“We have the data. Global CPO prices have risen 47 percent, the dollar has strengthened by more than 10 percent, but FFB prices have actually fallen,” he said.

He urged palm oil companies that have not yet adjusted FFB prices to promptly comply. The government, along with the National Police’s Food Task Force, will investigate around 270–300 companies that have failed to align FFB prices with regional regulations despite rising global CPO prices and exchange rate movements.

Sulaiman stressed that the government will not tolerate practices that harm oil palm farmers, noting that around 15 million Indonesians depend on the sector for their livelihoods.

“We must protect our farmers. There are 15 million oil palm farmers in Indonesia. If global prices rise and the exchange rate strengthens, but farmgate prices fall, that does not make sense,” he said.

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Translator: Muhammad Harianto, Resinta Sulistiyandari

Editor: M Razi Rahman

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