Complaints About Falling FFB Prices Oil Palm Farmers Meet Moeldoko In Batam

Presidential Chief of Staff Dr. Moeldoko welcomes the arrival of the General Chairperson of Apkasindo Gulat Manurung/Photo: Public Relations KSP

Batam – On the sidelines of chairing coordination meetings with ministries/agencies in Batam, Riau Islands, Presidential Chief of Staff Dr. Moeldoko received the arrival of oil palm farmers who are members of the Indonesian Palm Oil Farmers Association (Apkasindo), Saturday, June 25.

To Moeldoko, the General Chair of Apkasindo Gulat Menrung conveyed various problems of oil palm farmers, especially the drop in the price of Palm Fresh Fruit (FFB). He revealed, based on data from Apkasindo's FFB price complaint posts in 22 provinces, as of June 23, the price of FFB had touched a thousand rupiah, namely Rp 1,127 per kilogram for independent smallholders, and Rp 2,002 per kilogram for partnered farmers.

“This price is 24-57 percent below the normal price if it is based on the price determined by the Plantation Service in the 22 provinces. This condition provides a multiplier effect on farmers. For that we met Mr. Moeldoko for advice. Because apart from being a KSP, he is also the Apkasindo Board of Trustees," said Gulat.

According to Gulat, one of the reasons for the drop in FFB prices is the amount of export taxes. Such as Export Duties (BK), Export Levy (PE) BPDPKS, fulfillment of mandatory supply and price (DMO/DPO), as well as accelerated "Flush Out" exports. The amount of these export taxes is then charged to farmers.

“As a result, even though the price of CPO in Rotterdam on June 23, 2022 reached US$1,450 per tonne, farmers can only enjoy the FFB price of Rp. 1,027 – 2,002 per kilogram. Even for farmers who can only sell to collectors, FFB is only valued at Rp 400 per kilogram,” explained Gulat.

On the other hand, continued Gulat, palm oil mills (PKS) are currently facing the simalakama fruit. On the one hand, PKS must buy FFB from farmers, but on the other hand, the processing industry is slow to absorb PKS CPO. "So the drop in FFB prices for farmers is due to the large burden of CPO and slow exports," he explained.

On that occasion, Gulat asked the government to make the fulfillment of mandatory supply and price (DMO/DPO) and accelerated Flush Out (FO) exports as options, not conditions that all must be met.

“The Flush Out (FO) provision should be an alternative that can be used by exporters, if they object to complying with the DMO/DPO. If exporters don't want to fulfill the DMO/DPO, they can replace it with an FO of 200 thousand US Dollars per tonne," he suggested.

Meanwhile, the Presidential Chief of Staff, Dr. Moeldoko emphasized that he would try his best to help and fight to return the FFB price to normal. "I will also immediately convey to the President about Apkasindo's complaints and proposals," said Moeldoko.