Admitting Sad To Hear Farmers Selling Palm Oil FFB To Malaysia, Trade Minister Zulhas: Even Though The Government Has Required Entrepreneurs To Buy IDR 1,600 Per Kg

Illustration of fresh fruit bunches (FFB). (Photo: Antara)

JAKARTA - The action of oil palm farmers who chose to sell fresh fruit bunches (FFB) to Malaysia had gone viral on social media some time ago. This action was motivated by the falling FFB prices in the country.

Hearing this phenomenon, the Minister of Trade, Zulkifli Hasan, admitted that he was saddened by the conditions experienced by the farmers. Zulhas, who is familiar with Zulkifli Hasan, said that the problem of selling FFB to Malaysia occurred because palm oil factories had problems marketing their production.

So the factories' tanks are still full. This condition ultimately makes farmers' FFB unable to be absorbed domestically.

"I am also sad when I see that our oil palm farmers are risking themselves bringing their FFB to neighboring countries. Those who are close may be able to do it, but what about those who are far away? This is a problem that we must solve immediately," he said at the Ministry of Trade, Jakarta, Wednesday. July 6th.

Zulhas said, the government has indeed obligated palm oil entrepreneurs to buy smallholder FFB at a price of Rp. 1,600 per kg, some are even under Rp. 1,000 per kg. However, Zulhas realized that this would cause entrepreneurs to buy in smaller quantities due to the company's limited finances.

"Of course we are concerned, therefore we will immediately find a way so that this can also be completed quickly. The key is distribution, the price of FFB is closely related to smooth exports. If exports are smooth, the palm oil factories can have empty tanks, if the tanks are empty can buy people's palm oil. If a lot of people buy, of course the law of the market will gradually increase the price," he explained.

Meanwhile, Acting Chairman of the Indonesian Palm Oil Board (DMSI) Sahat Sinaga explained that the low ratio of domestic market obligation (DMO) and export approvals (PE) has made domestic crude palm oil (CPO) inventories pile up.

Furthermore, Sahat explained that in June 2022 alone, the stock of crude palm oil tanks reached 6.7 million tons or 100 percent.

"I have conveyed that the stock of the tank is full, if this does not work, then the FFB extraction is less, I estimate with a ratio of 1:8.5 in 2 months it will be completed. So we can withdraw FFB," said Sahat.