Members Of Commission VI DPR Value Food SOEs Need To Strengthen Cooperation With Oil Palm Farmers

Workers collect oil palm in Mulieng Manyang Village, Kuta Makmur District, North Aceh, Aceh. (Photo: Antara)

JAKARTA - Member of Commission VI of the House of Representatives, Amin Ak, assessed that food SOE holdings need to further strengthen cooperation with oil palm farmers in order to improve the distribution system and price control related to CPO and cooking oil.

"SOEs should be able to form partnerships with oil palm farmers where smallholder palm oil production currently reaches 41 percent of the national CPO production," said Amin Ak, quoted by Antara, Thursday, May 19.

Thus, he continued, in a condition where people's palm oil prices fell, SOEs could be a savior for farmers.

However, farmers are currently more comfortable selling their products to the private sector.

"This means that SOEs themselves must fix the pattern of cooperation so that farmers want to share," said Amin.

Amin added that the current position of food SOEs in the context of the palm oil business is still very small, around 4 percent on the upstream side and 5 percent on the downstream side.

Nationally, the combined Food SOEs currently have at least 85 distribution points of cooking oil, where this is considered to be an instrument that the private sector cannot compete with, so that it becomes a competitive advantage for the Food SOEs.

Amin believes that what is needed now is a distribution control mechanism to avoid price distortions or misallocations so that cheap cooking oil is not enjoyed by unauthorized parties.

Previously, SOE Minister Erick Thohir revealed that SOEs and the private sector were assigned to distribute cooking oil to 10,000 points.

"Speaking of cooking oil, we are now getting the assignment of BUMN with the private sector together. It is impossible for BUMN when there is a new assignment to stand alone, it is impossible because BUMN does not have the cooking oil," he said.

The Minister of SOEs added that SOEs have the distribution but not at all the required points.

"That's why we agreed, together with the private sector, the state-owned cooking oil production which is 18 percent of the total bulk cooking oil and the rest from the private sector, we make one. Then we distribute it to 10,000 points together," said Erick Thohir.

Deputy Minister of State-Owned Enterprises 1 Pahala N Mansury said his party was targeting 5,000 location points nationally.

Pahala hopes that ID Food Group will continue to make adjustments to the PPI Warung Pangan application to ensure the distribution of cooking oil, as well as monitor the affordability of cooking oil prices of IDR 14,000 per liter to the consumer or community level which can be accessed online.

Currently, there are 69,000 units of Food Stall Partners PT Indonesia Trading Company or PPI spread across more than 27 cities in Indonesia.

This food stall distribution network will continue to be developed by PPI as another strategic step in carrying out government programs, especially cooking oil and in general the availability and affordability of food in the community.