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First Edition

Fa cts o f

Oil Palm

Indonesian

Facts of Indonesian Oil Palm


By : Indonesia Palm Oil Advocacy Team - Indonesian Palm Oil Board (TAMSI-DMSI) Photo by: InfoSAWIT 2010, Indonesia Palm Oil Advocacy Team - Indonesian Palm Oil Board (TAMSI-DMSI)

Oil Palm for World Prosperity

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irst of all we would like to thank God Almighty, for having blessed us with health and patience, so that this book, entitled Facts Of Indonesian Oil Palm can be completed. The book is prepared in an effort to disseminate information about the development of Indonesian oil palm industry to the public in general, so that public can actively participate in helping the stakeholders of oil palm industry in the advancement of the oil palm industry in the future. The development of sustainable Indonesian oil palm industry is very important, since oil palm is one of the biggest contributors to the state foreign currency earnings in Indonesia. Indonesian oil palm has become one of the important pillars for the development of welfare for the farmers, regional development, as well as to the national economic development. Several parties, individual and organizations, have contributed a lot during the preparation of this book, namely academic, researchers, industry players, and other stakeholders of oil palm industry. Therefore, we are very indebted to them. Even though we have tried for the best, we realize that this book is still incomplete, and may still contain some mistakes, so that we warmly invite some comments and suggestions for the improvement of the book in the upcoming edition. Thank you. Jakarta, December 2010

Preface

Message from the Chairman of the Indonesian Palm Oil Board Franky Oesman Widjaja
il palm is a blessing for Indonesia. Global and national demands of vegetable oil for food and non-food products, as well as energy, will continue to increase. Palm oil possesses more advantages compared to other vegetable oils from the aspects of the products diversity which can be produced, nutrition, health, productivity, efficiency, and even pricing, which is very competitive to meet existing demands. Indonesia is also blessed with a suitable climate, fertile lands and manpower which allow Indonesia to continue developing the oil palm industry as one of the engine for development. The palm oil industry has become one of the main pillars of Indonesian economic development. This fact is indisputable, given that foreign exchange earnings and government revenues contributed by this industry are very significant. In 2009, the export value of crude palm oil and its derivatives reached US$9.14 billion, or more than 10% of the total value of non-oil and gas exports. State revenues generated by the oil palm industry include export tax, corporate income tax, property tax (PBB), value added tax and others which are also providing significant contribution to the country. Apart from being a major contributor for foreign exchange, the oil palm industrys development is in line and supports the governments program, which is pro-jobs, pro-poor, pro-growth and pro-environment. Pro-Jobs, in which the development of every additional 1,000 hectares of oil palm industry could provide employment for 500 manpower in the on-farm, off-farm and supporting sectors which consisted of not only crude laborers but also highly educated employees with at least bachelor degrees. With a broad composition of 4 million hectares of companies owned plantations and 3.3 million hectares of oil palm plantations owned by smallholders and the supporting industries, the industry employed around 4 million manpower. Therefore, there are approximately 16 million people who are reliant upon the oil palm industry.

Indonesian Palm Oil Advocacy Team (TAMSI) Indonesian Palm Oil Board (DMSI)

Content
Pro-Poor, in which the smallholders development program has transformed plantation workers into becoming plantation owners with higher income compared to the Provincial Minimum Wages (UMP). The Nucleus-Estate Smallholders (PIR) related to Transmigration ( Trans) and Local Community (LOK) and the Prime Cooperative Credit for Members (KKPA) program have given the plantation community ownership and then as a group/institution they created partnership with companies. The larger income has also stimulated the growth of self-financing farmers, and therefore both the incomes of program-farmers and self-financing farmers are generally much higher than the minimum wage. Pro-Growth, in which the development of the oil palm industry has contributed in opening a region for growth and stimulates the economic growth in other sectors. The oil palm industrial development in remote areas had opened the isolated regions, and therefore the access to and from other areas would be easier. The presence of the palm oil industry has also stimulated the growth of other industries in self-reliance and Corporate Social Responsibility, such as transportation, workshops industry, trade, and even in national scale such as the fertilizer industry, financial industry, heavy equipment industry and other industries. In addition, government revenues from these industries are in a large numbers that will increase the allocation of central funds for regional development to create prevalent national development. Although the national oil palm industry has exhibited good performance in economic growth and social development, there are many challenges and obstacles which must be faced. Sustainability issues and social conflicts still have the potential to inhibit the growth and reduce the competitiveness of the Indonesian palm oil industry. Therefore, accurate information should be disseminated so that the community wont be affected by misleading information which could lead to loss of opportunity to take advantage of the blessings from God Almighty to the nation that we love. On that basis, the Indonesian Palm Oil Board (DMSI) asks the researchers, academics and the media as the stakeholders of oil palm industry, to deliver accurate and comprehensive information to the Indonesian people and to the world through a book Fakta Kelapa Sawit Indonesia Therefore, DMSI would like to send our best gratitude . and high appreciation to all parties who have helped the preparation of this book. Hopefully, this book can be useful for the development of sustainable palm oil industry in the future. Jakarta, 10 November 2010.

Preface
Chapter I Indonesia Palm Oil Profile

4 8 20 30 34 38 46 60

Message from the Chairman of DMSI 5


Chapter II Indonesia Palm Oil Industry Chapter III Economy Added Value of Oil Palm Chapter IV Contribution of Oil Palm for Economy Chapter V Contribution of Oil Palm for Health Chapter VI Contribution of Oil Palm for Social and The Environment Chapter VII Contribution of Oil Palm for Co2 Emission Reduction

Franky Oesman Widjaja Chairman of the Indonesian Palm Oil Board

Facts of Indonesian Oil Palm


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Fact 1
The oil palm, Elaeis guineensis Jacq. is indigenous to West Africa, where the main palm belt ran from Angola to Liberia Regions.
Source : Mangga Barani (2009)

Fact 2
Photo: PPKS

In Archaeology notes, there is evidence that palm oil has been used in Abydos, Egypt since 5000 years ago.
Source : Friedel (1897)

Fact 3
Four oil palm seeds from Bourbon (Mauritius) planted in Bogor Botanical Garden in 1848 were the main seeds of all commercial oil palm plant in Indonesia and Malaysia.
Source : Pamin (1998)

Fact 4
Oil palm was planted on commercial scale in Liput River (Aceh) and Radja Island (Asahan, North Sumatera) in 1911. East Sumatera Coast, especially Deli, became the production center of palm oil by the Dutch colonial government. In Japanese colonial era 16% of oil palm land was converted into food land.
Source : Badrun (2010)
Photo: PPKS

Chapter I. Indonesian Palm Oil Profile


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Fact 5
The development of smallholder began at the new order era in the late of 1970s using the World Bank loan. But the efforts to accelerate the development of oil palm smallholder was initiated the early 1980s through a Nucleus Estate Smallholder (NEC) series project.
Source: InfoSAWIT Data Centre (2010)

Fact 6
Oil palm is a monoecious crop that has fibrous roots. The height growth of Palm oil tree is ranging from 35-75 cm per year, so that at the age of 25 years, the height of plant may reach 15-18 m.
Source: InfoSAWIT Data Centre (2010)

Fact 7
Palm oil trees in Indonesia consists of three varieties, namely Dura, Pisifera, and Tenera which are classified according to endocarp or shell thickness and mesocarp content.
Source: Hariyadi (2010)

Palm Oil Morphology

Leaf
The leaves are compound leaves. Dark greencolored leaves and midrib slightly younger. Its appearance is very similar to the skin of plants, only with thorns are not too hard and sharp. Palm leaf consists of several parts : a) A collection of children leaves (leafletss) which has a strand of (the lamina) and the bones of the child leaves (stem) b) Rachis constitute the place child leaves attached c) Petiole leaf stalks that are part of the leaves and stems d) Leaf sheath (sheath) that serves as protection from the bud and give strength to the stem. Leaf area increased progressively at the age of about 80-10 years after planting.

Palm kernel Pressing will produce Crude Palm Kernel Oil (CPKO)

Fruit
Distribution of types of fruit based on fruit skin color are grouped into three types : 1. Nigrencens,is purple to black at a young age and turn into orange-black when ripe. This type is most predominantly found in Tenera commercial varieties grown in Indonesia. 2. Virescens, is green when youngest and becoming reddish orange, but tip constant greenness. 3. Albescens, whitish at a young age, after being cooked becoming yellow and black-purple edges. Palm fruit clustered in bunches emerging from each midrib. The fruit consists of the pericarp is wrapped by the exocarp (fruit skin), mesocarp (fruit fiber) and endocarp (shell). The chemical composition of palm oil in mesocarp (crude palm oil CPO) is different from the existing oil in mature endosperm (PKO, palm kernel oil).

Fact 8
Topographical conditions and the types of soil in Indonesia which are podzolic, alluvial and latosol especially in Sumatera, Kalimantan, Sulawesi and Papua islands are very suitable for the business development of oil palm plantations .
Source: Pusat Penelitian Tanah dan Agroklimat (1993)

Root
The roots fiber of palm oil plantations consists of roots of primary, secondary, tertiary and quaternary. Main functions : 1. Supporting structures above ground stem, 2. Absorb water and nutrient elements from the soil, 3. As one tool respiration.

Stem
Stems of plants covered with old leaf midrib until about age 11 15 years. After that age, former dry midrib separated from each other and becomes similar to coconut crop. Generally, in addition to stem height up to 35-37 cm a year, depending on environmental conditions and genetic diversity.

Flower
Palm oil is a monoecious plant married, means there are male and female flowers on one tree but not in the same cluster, although sometimes also experienced male and female flowers on one stem (hermaphrodite).

Fact 9
As a tropical country with rainfall of 2000 - 2500 mm / year, dry months ranged 2-3 months/year and average temperatures of 24-28oC, Indonesias region is very suitable for oil palm plantations.
Source: Pahan (2006)

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Palm mesocarp Pressing will produce Crude Palm Oil (CPO)

Facts of Indonesian Oil Palm


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Facts of Indonesian Oil Palm

Potential Land Area of Oil Palm Plantations


Provinces North Sumatera Riau Bengkulu West Kalimantan Central Kalimantan East Kalimantan Central Sulawesi South Sulawesi Papua Total Area of Potential Land Potential Land Area (Ha) 1,298,000 2,848,200 728,479 3,671,100 3,638,500 4,399,400 146,300 288,000 5,896,500 22,914,479

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Fact 10
Palm oil has higher productivity compared to other oil-producing crops such as soybean, sunflower and rapeseed. The productivity of palm oil is 3.5 tons/ha/year, while soybean oil is only 0.36 ton/ha/year, sunflower oil is around 0.48 ton/ha/years and Rapeseed oil is 0.55 ton/ha/year.
Source: Oil World, Indonesian Oil Palm Society , InfoSAWIT Data Centre (2010)

Fact 12
In 2009, world palm oil production reached 43 million tons, from the total land area of 12,8 million ha, in which Indonesia is the largest producer, while the total production of soybean oil in the same year was 35.6 million tons, rapeseed oil was 20.4 million tons and sunflower oil was about 11.8 million tons. In 2010, it is predicted that world palm oil production will reach 52.3 million tons.
Source: Oil World (2010)

World Vegetable Oil Productivity (Ton/ha/year)


6.0 5.5 5.0 4.5 6.0

Worlds Palm Oil Production (2000-2010*)


55,000 50,000 45,000

Productivity Potency

4.0 3.5 3.0 2.5 2.0 1.5 1.0 0.5 0

3.74

40,000 000 Tonnes 35,000 30,000 25,000 20,000 15,000


0.67 0.48 0.38

10,000 5,000

Palm Oil

Rapeseed Oil

Sun Flower Oil

Soybean Oil

2004

Fact 11
From the total area of vegetable oil producing plants in the world which is 231.9 million ha, the total area of oil palm area is only 12.8 million ha (5.5%) compared to the total area of soybean plants which is 102.7 million ha (44.3%).
Source: Oil World, Indonesian Oil Palm Society , InfoSAWIT Data Centre(2010)

Fact 13
In the past seven years, the worlds palm oil consumption increased sharply. In 2009, palm oil consumption reached 42 million tons. The predicted consumption in 2010 is in the amount of 44.5 million tonnes.
Source: Oil World (2010)

Comparison of The Acreage of Vegetable Oils Producing Area in the World


12.8 Million Ha 21.56 Million Ha 23.4 Million Ha
45,000

Worlds Palm Oil Consumption (2004-2010*)


40,000

9.5 Million Ha 102.7 Million Ha


000 Tonnes

35,000 30,000 25,000 20,000 15,000 10,000 5,000 0 2004 2005 2006 Year 2007 2008 2009 2010*
* Prediction

30.8 Million Ha 31.07 Million Ha


Soybean Rapeseed Cotton Sun Flower Peanut Oil Palm Coconut

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2005 2006 Year 2007 2008 2009 2010*
* Prediction

Facts of Indonesian Oil Palm


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Fact 14
Contribution of Indonesian CPO for the world is increasing and successfully has surpassed Malaysia as the largest producer of CPO in 2006. In 2009, the production of Indonesian CPO reached 21.511 million tons.
Source: Oil World (2010)

Fact 16
Indonesia exports CPO and its derivatives to more than 45 countries in the world. There are six largest consumers of Indonesian CPO namely India, EU27, China, Bangladesh, Pakistan and USA.
Source: CBS, GAPKI (2010)

CPO Production of Five Main CPO Producers in The World (2004-2010 *)

Destination of Regional Exports Of Indonesian CPO and Its Derivatives


5,000,000 4,500,000 4,000,000 3,500,000 3,000,000 2,500,000 2,000,000 1,500,000 1,000,000 500,000 0
*

India

Uni Eropa

* Prediction

Fact 17
Palm oil export volume of Indonesia in 2009 reached 15.5 million tons, where as in 2005, it was 10.37 million tons, so that, in the past five years, the increase of export volume is more than 50%. The export value in 2009 reached US$ 9.14 billion which was almost 250% compared to that of the export value in 2005 which was US$ 3.76 billion.
Source: CBS, Ministry of Trade Republic of Indonesia (2010)

Fact 15
CPO is the raw material used for derivative products for both food and non-food industries. CPO processing in refineries produce olein and stearin with Palm Fatty Acid distillate (PFAD) as by products. Olein and stearin can be processed further into food products such as cooking oil, margarine, shortening and non-food products such as soap, candles, detergents and cosmetics while PFAD can only be used for non-food products.
Source: APOLIN, Indonesian Oil Palm Society (2009)
Photo: Musim Mas

Palm Oil Export Volume and Value in 2005-2009


CPO Year Volume (000 Ton) 4,565 4,840 5,701 7,904 8,799 Value (US$ Miliar) 1.593 1.791 3.739 6.557 5.006 Palm Oil Volume (000 Ton) 5,811 7,261 6,174 6,387 6,730 Value (US$ Miliar) 2.164 3.027 4.130 5.845 4.138 Total Volume (000 Ton) 10,376 12,101 11,875 14,291 15,529 Value (US$ Miliar) 3.757 4.818 7.869 12.402 9.144

2005 2006 2007 2008 2009

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Integrated oil palm downstreem industry

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China Malaysia Singapura Bangladesh Egypt Pakistan USA Others

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Fact 18
The composition of saturated and non saturated fatty acids in palm oil is balanced, so it is suitable to become the raw material for cooking oil.
Source: Hariyadi (2010)

Fact 19
Palm kernel oil can be used as raw material for basic oleochemicals industry such as fatty alcohol. Fatty alcohol can be used as the feedstock of downstream industry such as surfactants, which can be processed futher into cosmetics, personal care, detergents and so on.
Source: Ministry of Industry, InfoSAWIT Data Centre (2010) Average 0.2 1.1 44.0 4.5 0.4 0.1 39.2 10.1 0.4

Fatty Acid Compotition in Palm Oil


Composition of Fatty Acids Percentage of the Total Fatty Acids (%) Range 0.1 1.0 0.9 - 1.5 41.8 45.8 4.2 5.1 0.2 0.7 0.1 0.3 37.3 40.8 9.1 11.0 0.0 0.6

Saturated Fatty Acids C12:0 C14:0 C16:0 C18:0 C20:0 C16:1 C18:1 C18:2 C18:3

Fatty Acid Compotition in Palm Oil Kernel


Fatty Acid Types
Laurat C12 Miristat C14 Palmitat C16 Kaprat C10 Kaprat C8 Stearat C18 Oleat C18 Linoleat C18 Lainnya
Green : Saturated Fat Blue: Unsaturated Fat Orange: Many Unsaturated Fat

Non Saturated Fatty Acids

Fact 20
Oil palm fresh fruit bunches can be processed into crude palm oil (CPO) and palm kernel oil (PKO) at a palm oil mill (POM). By product of them, such as oil palm empty fruit bunches (EFB) can be recycled into various biomass products, while methane can be extracted for fuel gas and the rest flowed into the garden as fertilizer.
Source: InfoSAWIT Data Centre (2010)

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Colour Percentage (%)
48.2% 16.2% 8.4% 3.4% 3.3% 2.5% 15.3% 2.3% 0.4%

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Fact 21
The industrial tree of palm oil from upstream to downstream.
Source: Ministry of Industry, InfoSAWIT Data Centre (2010)

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Facts of Indonesian Oil Palm

Chapter II. Indonesia Palm Oil Industry

Fact 22
Area of oil palm plantations in Indonesia increased from year to year. In 2009, the area reached 7.3 million ha spread out all over Indonesia. The spread of oil palm plantations, supports economic development and regional development in Indonesia.
Source: Ministry of Agriculture Republic of Indonesia (2010)
8,000 6,000 1000 ha

The Growth of Indonesias Oil Palm Plantation

4,000 2,000

1980

Fact 23
Regional development of oil palm cultivation in Indonesia spreads from Sumatera to Papua. Currently, oil palm was more developed in Kalimantan, Sulawesi and Papua as they still have vast land reserved. Plantations development in those regions have already openned job vacancies for local people, and successful in poverty alleviation.
Source: Ministry of Agriculture Republic of Indonesia, Ministry of Forestry Republic of Indonesia, Ministry of Industry Republic of Indonesia, InfoSAWIT Data Centre (2010)

Indonesia Palm Oil Plantations


Nangroe Aceh Darussalam : Plantations: 274,135 Ha CPO: 709,021 Tonnes Riau : Plantations: 1,623,458 Ha CPO: 5,072,834 Tonnes West Kalimantan : Plantations: 476,891 Ha CPO: 1,140,639 Tonnes East Kalimantan : Plantations: 368,504 Ha CPO: 370,671 Tonnes

North Sumatera : Plantations: 1,026,644 Ha CPO: 3,200,673 Tonnes

West Sumatera : Plantations: 305,871 Ha CPO: 839,640 Tonnes Papua : Plantations: 25,926 Ha CPO: 56,738 Tonnes

South Sumatera : Plantations: 718,068 Ha CPO: 1,829,609 Tonnes

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1985 1990 1995 2000 2005 2009
Jambi : Plantations: 454,771 Ha CPO: 898,640 Tonnes South Sulawesi : Plantations: 133,493 Ha CPO: 429,388 Tonnes West Papua : Plantations: 33,646 Ha CPO: 80,328 Tonnes Central Kalimantan : Plantations: 709,206 Ha CPO: 1,352,934 Tonnes

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Fact 24
Ownership of oil palm plantations in Indonesia is classified into three groups, namely: Smallholder Plantation (3.2 million ha), Large State Own Plantation (617,000 ha) and Large Private Plantations (3.5 million ha).
Source: Ministry of Agriculture Republic of Indonesia, InfoSAWIT Data Centre (2010)

Fact 26
The annual growth rate of Indonesias CPO production during the last ten years continued to increase by 12%.
Source: Ministry of Agriculture Republic of Indonesia, InfoSAWIT Data Centre (2010)

Land Development of Indonesian Palm Oil Area


Year 1980 1990 2000 2007 2008 2009 Ptb %/th Land Area (000 ha) SP 6 292 1,167 2,752 2,903 3,204 24.2 % 2 25 28 40.7 41.4 43.7 LSOP 200 372 588 606 608 617 4.0 % 68.9 33 14.1 9 8.7 8.4 LPP 84 463 2,403 3,409 3,409 3,501 13.7 % 28.9 41 57.8 50.3 48.6 47.8 National 290 1.17 4,158 6,767 7,008 7,322 11.8

The Growth of CPO Production


Year 1980 1990 2000 2007 2008 2009 Ptb %/th Production CPO (000 tonnes) SP 1 377 1,906 6,358 7,105 7,976 35.8 % 0.14 15.62 27.22 35.99 37.01 37.08 LSOP 499 1,247 1,461 2,117 2,295 2,495 5.3 % 69.21 51.68 20.87 11.98 11.95 11.60 LPP 221 789 3,634 9,190 9,800 11,040 14.0 % 30,65 32,70 51,91 52,02 51,04 51,32 National 721 2,413 7,001 17,665 19,200 21,511 12.0

Note: SP: Smallholder Plantation, LSOP : Large State Own Plantation, LPP : Large Private Plantations

Note: SP: Smallholder Plantation, LSOP : Large State Own Plantation, LPP : Large Private Plantations

Fact 25

Within 2000 2009 productivity CPO in Indonesia around 3 tons/ha/year.


Source : Ministry of Agriculture RI, InfoSAWIT Data Centre (2010)

CPO Productivity During 2000-2009


4.5 4.0 3.5 Tannes/Ha/Year 3.0 2.5 2.0 1.5 1.0 0.5 0

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Fact 27
Palm oil mill (POM) is one of the production supply chain in the palm oil industry that serves as a post harvest processing of fresh fruit bunches (FFB) into CPO. The number of POM in Indonesia is 608 units with the total capacity of 34,280 tons FFB/hr and spread out in 22 Provinces.
Source: Ministry of Agriculture Republic of Indonesia (2009)

Fact 28
As the largest CPO producer in the world, Indonesia is able to meet the needs of cooking oil in the country that reach 4 million tons annually. The amount of cooking oil factory in Indonesia was 94 units in 2009 which are spread out throughout Indonesia.
Source: Central Bureau of Statistics, Ministry of Agriculture Republic of Indonesia (2009)

Indonesian Palm Oil Mills


No. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. NAD North Sumatera West Sumatera Riau Riau Islands Jambi South Sumatera Bangka Belitung Bengkulu Lampung West Java Banten West Kalimantan Central Kalimantan South Kalimantan East Kalimantan Central Sulawesi South Sulawesi West Sulawesi South-East Sulawesi Papua West Papua Total Provinces Total Number of Palm Oil Mill (Unit) 25 92 26 140 1 42 58 16 19 10 1 1 65 43 15 29 7 2 6 3 3 4 608 Production Capacity (Ton Fresh Fruit Bunches/hour) 980 3,815 1,645 6,660 40 2,245 3,555 1,235 990 375 30 60 5,475 3,100 770 1,545 590 150 260 260 140 360 34,280

Distribution of Cooking Oil Factories in Indonesia


No 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 NAD North Sumatera West Sumatera Riau Jambi South Sumatera Lampung DKI Jakarta West Java Central Java East Java Banten West Kalimantan East Kalimantan North Sulawesi Central Sulawesi South Sulawesi Gorontalo West Papua Total Provinces Unit 2 13 3 8 2 5 4 8 8 5 9 1 11 2 5 1 5 1 1 94

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Fact 29
Oleochemical industries are included in the group of palm oil derivatives industry. In Indonesia, there are nine basic oleochemicals manufacturers that produce fatty acid, fatty alcohol and glycerine. Fatty acid production capacity reaches 986,000 tons/years, fatty alcohol reaches 490,000 tons/year and glycerine reaches 141,700 tons/year.
Source: Apolin (2010)

Fact 30
CPO is the raw material source of alternative energy in the form of biodiesel which results in lower emissions than that of fossil fuel sources. CPO can be a major energy source in the future. The number of biodiesel producers is 20 companies with a total installed capacity of 3 million tons/year.
Source: APROBI (2009)

Manufacturers and the National Oleochemical Industry Capacity (in 1000 tons)
No 1 2 3 4 5 6 7 8 9 Company Names PT Ecogreen (Medan & Batam) PT Sumiasih, Bekasi PT SOCI MAS , Medan PT Flora Sawita Chemindo (Bakrie Group), Medan PT Musim Mas, Medan PT Domba Mas (Bakrie Group), Kuala Tanjung Wilmar Group, Gresik PT Nubika Jaya , Kisaran PT Cisadane Raya Chemical, Tangerang Total Fatty Acid 45 91 80 50 320 60 120 130 90 986 490 100 40 Fatty Alcohols 350 Glycerin 24 10 8 5.1 30 4.6 30 20 10 141.7

The Producers of Biodiesel in Indonesia and Their Capacities


No 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Company Names PT Alia Mada Perkasa PT Anugrah Inti Gemanusa PT Bioenergi Pratama Jaya PT Cemerlang Energi Perkasa PT Damai Sejahtera Sentosa Cooking PT Darmex Biofuel PT Energi Alternatif PT Eternal Buana Chemical Industries PT Eterindo Nusa Graha PT Indo Biofuels Energy PT Multikimia Intipelangi Musim Mas Group PT Pasadena Biofuels Mandiri PT Pelita Agung Agrindustri PT Petro Andalan Nusantara PT Primanusa Palma Energi PT Sintong Abadi PT Sumi Asih PT Wahana Abdi Tritatehnika Sejati PT Wilmar Bio Energi Indonesia TOTAL Location Kosambi, Tangerang Gresik Kab Kutai Timur Kab Berau Dumai, Riau Rungkut, Surabaya Bekasi North Jakarta Cikupa, Tangerang Gresik Merak Bekasi Kab Deli Serdang Batam Cikarang Bengkalis, Riau Dumai North Jakarta Kab Asahan, North Sumatera Bekasi Cileungsi, Bogor Dumai Capacity (Tons/Year) 11,000 40,000 6,000 60,000 400,000 120,000 150,000 7,000 40,000 40,000 60,000 14,000 70,000 350,000 10,240 200,000 150,000 24,000 35,000 100,000 132,200 1,050,000 3,069,440

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Fact 31
Infrastructure is an important tool in the national palm oil industry. Until today from six public active seaports in Indonesia, there are two CPO export ports namely Port of Belawan, located in the North Sumatera province and Dumai Port, located in Riau province.
Source: Ministry of Transportation Republic of Indonesia, InfoSAWIT Data Centre(2009).

Belawan Ship Port Ship capacity 50,000 DWT Dumai Ship Port Ship capacity 50,000 DWT

Sei Lais Ship Port (Palembang) Ship capacity 20,000 DWT Tanjung Perak Ship Port Ship capacity 50,000 DWT Tanjung Priok Ship Port Ship capacity 60,000 DWT

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Panjang Ship Port (Lampung) Ship capacity 20,000 DWT

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Chapter III. Economic Added Value of Oil Palm

Fact 32
CPO and PKO have advantages as raw materials for consumer goods, both as food and non food products. In terms of economic value, the downstream products would generate higher added values.
Source: Surfactant and Biofuel Research Centre / SBRC IPB (2009)

Value Added of Eight Supperior Derivative Product


800

600

400

200

Cooking Oil

Fatty Acid

Fact 33
CPO can be converted into various speciality fats products, which mostly are safe and healthy food products for human consumption.
Sourcer: Elisabeth (2009)

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Stearat Margarine Gliserine Fatty Alcohol Metil Ester Surfactant

Speciality Fats Product Catagory

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Fact 34
The use of CPO in Indonesia is also for non-food products, such as oleochemicals and biodiesel. Oleochemical products can be used as raw material for soap, candles, cleaning materials and body care products.
Source: Ministry of Industry, APOLIN (2009)

Fact 36
From 50,2% of saturated fatty acids (palmitic acid) content, only 1,1% of myristic (14:0) that can increase blood cholesterol levels, while other 49,1% content of palm oil is neutral and do not increase blood cholesterol levels.
Source: Ong dan Goh (2002)

The Use of CPO for Non-Food Products in Indonesia


Biodiesel, 4% Oleochemicals, 8%

Fatty Acid Composition Inside Palm Oil and The Impact for Blood Cholestrol
Fatty Acid Lauric (12:0) Myristic (14:0) Palmitic (16:0) Stearic (18:0) Oleic (18:1) Linoleic (18:2) Others (16:1, 18:3)
Palm oil wax

Refinery, 88%

Total Palm Oil

Fact 35
With further processing (interesterification), palm oil can be used as nutraceutical products which is useful as raw materials for pharmaceutical / health products. Pharmaceutical grade glycerine can be used as one of raw materials for drug manufacture.
Source: PPKS, APOLIN (2009)

Fact 37
Indonesias oil palm seeds production continue to increase. With the addition of three new seed companies in 2010, total national production capacity of oil palm seeds is 256 million seeds.
Source: Ministry of Agriculture Republic of Indonesia, InfoSAWIT Data Centre (2010)

Capacity of Indonesian Palm Oil Seed Production


No. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. PPKS Medan PT Socfin Indonesia PT London Sumatra Tbk. PT Bina Sawit Makmur PT Dami Mas Sejahtera PT Tunggal Yunus Estate PT Tania Selatan PT Bakti Tani Nusantara PT Bakrie Sumatera Plantation Tbk. PT Sasaran Ehsan Mekarsari PT Sarana Inti Pratama Total Producer Capacity 50,000,000 47,000,000 23,000,000 30,000,000 24,000,000 14,000,000 7,000,000 20,000,000 22,000,000 4,000,000 15,000,000 256,000,000

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Composition (%) 0.2 1.1 44.3 4.6 39.0 10.5 0.3 100 Impact for Blood Cholestrol Negative or Neutral Increase the cholestrol Neutral Neutral Decrease the cholestrol Decrease the cholestrol Decrease the cholestrol

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Facts of Indonesian Oil Palm

Chapter IV. Contribution of Oil Palm for Economy

Fact 38
Palm oil industry is the most efficient industry compared to other vegetable oils industry.
Source: Zimmer (2009)

Comparison of The Worlds Production Cost of Vegetable Oil


US$/Ton

1100 1000 900 800 700 600 500 400 300 200 100 0
Palm Oil (Indonesia) Palm Oil (PNG) Soybean Oil Soybean Oil Palm Oil (Argentina) (Brazil) (Malaysia) Rapeseed Oil (Kanada) Palm Oil (Kolombia) Rapeseed Soybean Oil Soybean Oil Oil (Cina) (USA) (Uni Eropa)

Fact 39
Although fluctuating, the price of palm oil is the most competitive compared to the worlds price of other vegetable oils.
Source: Oil World (2009).

Comparison Charts of Eight World Vegetable Oil Prices

Palm Oil Sunflower Oil

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PKO Coconut Oil Soybean Oil Cotton Oil Canola Oil Peanut Oil

35

Fact 40
Total area of oil palm plantations 7.3 million ha, the number of workers absorbed the upstream sector reached 1.95 million people in the state and private plantations, while 1.7 million farmers in peoples plantations. The workers absorbed in palm oil mills reaches 70,000 people. Total labor force is absorbed in oil palm plantations to palm oil mills to reach 3.72 million people. Middle and downstream industries provide employment for 31,664 peoples that from upstream to downstream palm oil industry could provide employment for 3.75 million people. If a worker has a family consisting of his wife and two children, then the total of people who depend on Indonesian palm oil industry as much as 15 million people.
Source: InfoSAWIT Data Centre (2010)

Fact 41
Oil palm encourages the growth of other economic sectors such as services, telecommunications and transportation. Therefore, the palm oil industry became wheel drive of local and national economy.
Source: Nurrohmat, et al. (2010).

Multiplier Effects of the Oil Palm No


1

Expenditure multiplier = 2.79. If it is analyzed from the impact of its spread, chemical industry, food industry and trade sectors are the sectors that most benefit from the growth of oil palm plantation sector. Backward linkages = 1 and forward linkage = 1.30. That means oil palm sector is able to encourage the growth in the upstream sector, especially in industrial sector of fertilizers, chemicals and financial sectors, as well as in the downstream sector. Income multiplier = 2.50. This means that if there is additional investment in the oil palm sector. Then, the total public revenue will increase 2.5-fold. Employment multiplier in the oil sector and the whole economy, respectively, are 1.05 and 1.84. That is, the growth of the palm oil sector will increase employment in the sector of 1.05-fold and 1.84-fold

3 4

Fact 42
Net income of smallholders with 2 ha of land ownership is US$ 2-4 million/ month which is sufficient to meet their primary and secondary needs.
Source: Ministry of Agriculture Republic of Indonesia, InfoSAWIT Data Centre (2010)

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Description

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Chapter V. Contribution of Oil Palm for Health

Fact 43
Palm oil has a wide variety of useful nutrients required in the body a. -Carotene Concentration on CPO is 235 ppm most powerful antioxidant among the other forms of carotenoids Reduce the risk of liver, lung, pancreas and stomach cancer (Murakoshi, 1992) Reduced atherosclerosis in the arteries (Bonnie & Choo, 2000) The recommended intake is more than 1.5 mg/day (Food and Nutrition Board 2000) b. -Carotene Concentration on CPO is 377 ppm Reduced atherosclerosis inside arteries (Bonnie & Choo, 2000) Reduce the risk of heart disease (Food and Nutrition Board 2000) Potential to maintain eye health The recommended intake is 2.5-5.9 mg/day (Food and Nutrition Board 2000) c. Vitamin E Concentration on CPO is 810 ppm Having forms of -tocopherol, -, -, -tokotrienols Reduce the risk of cancer Directly serve as natural antioxidants in protecting cells membrane from oxidative damage Reduce the risk of heart disease Potential to reduce the risk of diabetes Potential to improve the immune system Potential to reduce the risk of Alzheimers disease and Down Syndrome The recommended intake is 15 mg / day (Food and Nutrition Board 2000) d. Lycopene Concentration on CPO is 8.74 ppm Reduce the risk of lung, stomach and prostate cancer Potential to reduce the risk of CHD (coronary heart disease) Potential to prevent osteoporosis Potential to remind fertility in men Potential to reduce the risk of neurological diseases such as Parkinsons. The recommended intake is 3.7-16.15 mg / day (Rao et al., 2002) e. Lutein Concentration on CPO is 8.74 ppm Reduce the risk of lung, stomach and prostate cancer Potential to reduce the risk of CHD (coronary heart disease) Potential to prevent osteoporosis Potential to remind fertility in men Potential to reduce the risk of neurological diseases such as Parkinsons. The recommended intake is 3.7-16.15 mg / day (Rao et al., 2002) f. Sterol In CPO, there is form of -sitosterol 370 ppm, kampesterol 151 ppm and stigmasterol 66 ppm. -sitosterol has the potency of hypocholesterolemic (Bonnie & Choo, 2000)

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g. Unsaturated fatty acids Oleic acid C18: 1 Cis (-9) 40.8% Linoleic acid C18: 2 (-6) 11.9% Linolenic acid C18: 3 (-3) 0.4% Effectively reduce blood cholesterol. Saturated fatty acids (palmitic acid 36.6% and 3.7% stearic acid) do not increase blood cholesterol (Bonnie & Choo, 2000) h. Ubiquinone-10 (UQ-10) CPO contains 18-25 ppm of ubiquinone-10 Potential to improve the immune system Potential to prevent heart disease and hypertension Potential to prevent damage to red blood cells due to oxidation (Bonnie & Choo, 2000)

Fact 46
Palm oil is a natural source of vitamin E. Constituent of vitamin E, contained in palm oil namely tocopherols and tocotrienols. It is antioxidant that can counteract the free radicals thus preventing premature aging and cancer.
Source: Slover (1971), Gunstone (1986), Palm Oil in Human Nutrition (1999)

Composition of Minor Components in Various Oils and Fats


Tocopherols Oil & Fats Tocotrienols Total T + T3

Fact 44
CPO can be processed into red palm oil to retain value nutrition by special processing a. By Supercritical Fluid Extraction (SFE) (Muchtadi, 1992) (Sulaswatty, 1998) yield -carotene 96.4% b. By molecular distillation yield of -carotene 80% (Ooi et al., 1996) c. By the purification process of the modified conventional oil

Fact 47
Crude palm oil is a vegetable oil with very high content of carotenoids (Pro-vitamin A). At some private plantations and State Owned Plantation it was found that some oil palm trees produce 4000 ppm of beta-carotene (provit A).
Source: Hariyadi (2010)

Fact 45
Application of red palm oil a. RPO supplementation for pregnant and lactating women Increasing concentrations of -, -carotene in blood plasma and breast milk. (Lietz et al., 2001) b. Potential to overcome vitamin A defficiency National promotion of the use of red palm oil to reduce vitamin A deficiency in the whole population. (Scrimshaw, 2000) c. Raw and derived products Oil meal Oil saute, Oil sachets for instant noodles, Salad dressings Beverage emulsions scott emulsion like with the aromas of fruit, chocolate, mocca Microencapsulation Fat spreads Margarine CBE (Cocoa Butter Equivalent) CBS (Cocoa Butter Substitute)

Content Of Vitamin A (Retinol Equivalent) in Various Food Products


Variety Of Food Material Orange Banana Tomato Carrot Red Palm Oil (Refine) Crude Palm Oil (CPO) g Rethynol Equivalent per 100 g Edible Material 21 50 130 400 5000 6700

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Fact 48
The products derived from palm oil do not contain trans fatty acid (transfat) because on the derivatived products of vegetable oils, transfat formation occurs in partial hydrogenation process that is not happening in the manufacturing of palm oil products.
Source: Hariyadi (2010)

Palm Oil Fatty Acid Composition and The Effects to Blood Cholestrol
Saturated Saturated Fatty Acid C : 12 : 0 (Lauric Acid) C : 14 : 0 (Myristic Acid) C : 16 : 0 (Palmitic Acid) C : 18 : 0 (Stearic Acid) Non-Saturated Fatty Acid C : 18 : 1 (Oleic Acid) C : 18 : 2 (Linolenic Acid) C : 18 : 3 (Linolenic Acid) 38-50 Reducing blood cholesterol levels 5-14 Reducing blood cholesterol levels 1 Reducing blood cholesterol levels 1 Negative or neutral 1-2 Improve blood cholesterol levels 32-47 Neutral 4-10 Neutral
Photo: Antara

Fact 49
Palm oil, includes one of the 17 edible oils which by the Food and Agriculture Organization (FAO) are considered to meet the Code and Decode (Codex) Alimentarius. One of the requirements of the Codex Alimentarius Commission is the carotene content of 500-2000 ppm, while the oil content of natural carotenoids of palm is 500-700 ppm.
Source: FAO/WHO(1983)

Compotition Carotenoid in CPO


Carotene Compottion [%]
1.27 0.06 0.68 56.02 35.16 2.49 0.69 0.33 0.83 0.29 0.23 0.2 1.30 Phytoene Phytofluene Cis--carotene -carotene -carotene

Fact 50
The composition of fatty acids in palm oil is the most balanced when compared to other vegetable oils.
Source: MPOC (1991)

Composition of Fatty Acid in Vegetable Oil


Oil Names Palm Oil Peanut Oil Olive Oil Corn Oil Soybean Oil Sun Flower Oil Coconut Oil Monounsaturates (%) 40 39 75 30 25 13 5 Polyunsaturates (%) 10 42 10 54 60 77 1 Saturates (%) 50 19 15 16 15 10 94

Cis--carotene -carotene -carotene -carotene Neurosporene -Zeacarotene -Zeacarotene Licopen

Fact 53 Fact 51
Similar to other vegetable oil, palm oil do not contain cholestrol compounds. The content of oleic acid high (C: 18: 1) in palm oil instead can reduce blood cholesterol.
Source: MPOC (1991)

Palm oil can be consumed safely and better than olive oil in terms of reducing the risk of cancer. Palm Comparative Effect of Cholesterol Modulation of Oil Palm with Olive Oil oil could increase good cholesterol (HDL) in blood that slightly ishigher than that of olive oil. HDL can reduce the risk of cancer.
Olive Oil Palm Oil Olive Oil Palm Oil

42

Source: Ng, et al (1992), Choudhury, et al (1995)

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Percentage (% w/w) Effect to Blood Cholestrol

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Fact 52
Palm oil can reduce the risk of coronary heart disease. Palm oil contains carotenoids which most of them are beta carotene that are used as antioxidant which prevent the formation of plaques that can clog blood arteries . In addition, food intake that contains beta carotene also may reduce risk of mouth, pharynx, larynx, esophagus, gastric, colon, rectum, bladder and cervix cancer, preventing premature aging and boost immunity.
Source: Gee (2007)

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Content of Palm Oil Fat


Fatty Acid 12:0 14:0 16:0 16:1 18:0 18:1 18:2 18:3 20:0 Total Fats (%) Range 0.1 1.0 0.9 1.5 41.8 46.8 0.1 0.3 4.2 5.1 37.3 40.8 9.1 11.0 0.0 0.6 0.2 0.7 Average 0.2 1.1 44.0 0.1 4.5 39.2 10.1 0.4 0.4

Fact 54
Palm oil contains Monounsaturated Fatty Acid (MUFA), 40% acids saturated fat (palmitic) that is good for health. Source: Muchtadi (1992)

Fact 55
Tocotrienols contained in palm oil can reduce the Low Density Lipoprotein (LDL/ bad cholesterol) and increase High Density Lipoprotein (HDL/good cholesterol). The content of tocopherol tocotrienols in palm oil is much greater than that is in other vegetable oils.
Source: MPOC (1991)

Fact 56
The process of making cooking oil and its derivative products in refineries has complied with the government regulations related to quality and food safety as regulated in Hazard Analysis Critical Control Point (HACCP).
Source: Hariyadi, InfoSAWITData Centre(2010)

Tocopherol Tocotrienols Content and Tocotrienols Trajectory Tocopherol Impressions Vegetable Oil Tocotrienol (ppm) Tocotrienol (ppm) Palm Oil Kernel Oil Olive Oil Coconut Butter Corn Oil Soybean Oil 218 12 50 200 800 960 773 18 0 10 0 0

Fact 57
Palm oil is very suitable to be processed as cooking oil because of long shelf life and producing the tasty flavor of food.
Source: SEAFAST (2009)

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Photo: PT Smart Tbk.

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Chapter VI. Contribution of Oil Palm for Social and The Environment
Photo: PT Satrindo Mitra Utama

Fact 59
High Conservation Value (HCV) and pest control and integrated disease (IPM) have already been implemented in the of national oil palm company as an effort to protect biodiversity and to minimize the use of chemical materials in oil palm plantations management .
Source: Indonesian Oil Palm Society, InfoSAWIT Data Centre(2010)

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Fact 58
Indonesias palm oil industry has adopted good cultivation and sustainable management to minimize environmental impact damage, such as the zero burning.
Source: InfoSAWIT Data Centre (2010)

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Fact 60
Chemical characteristic and size of the oil palm wood stem allow waste palm oil wood to be used as raw materials of furniture such as cabinets, tables and chairs.
Source: Balfas (2009)

Fact 61
Many of oil palm plantations have obtained the ISO 90001 and 14001 certificates, which show the concern for sustainable oil palm plantations.
Source: InfoSAWIT Data Centre (2010)

The Physical Dimensions Of The Average Oil Palm Stem


Variety Name Dura Pisifera Tenera Average : Diameter (cm) 48.59 46.65 39.00 44.75 Height (m) 11.80 11.20 8.86 10.62 Volume (m3) 2.19 1.91 1.06 1.72

Fact 62
The number of Indonesian companies that are members of the RSPO in 2010 is 75 companies. The companies are actively involved in the preparation of the Principle and Criteria of RSPO and the National Interpretation of RSPO P & C. Several companies have had RSPO certification, among others, PT Musim Mas, PT PP London Sumatera Indonesia Tbk, PT Hindoli, PTPN III and PT Bakrie Sumatera Plantation.
Source: RSPO, InfoSAWIT Data Centre 2010

Chemical Characteristics Of Oil Palm Wood, Agathis And Teak


Chemical Compounds Content, % Cellulose Lignin Pentosan Ash Silica Solubility, % Alcohol-benzene Cool Water Hot Water 1% NaOH Oil Palm 54.38 23.95 19.36 2.02 1.34 8.90 12.02 16.37 24.87 Agathis 52.4 24.7 12.6 1.1 0.1 2.0 0.6 1.3 7.3 Jati 47.5 29.9 14.4 1.4 0.4 4.6 1.2 11.1 19.8

Photos: Jamal Balfas

48

Photo: PT BSP Tbk

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Fact 63
Oil palm plantations can be integrated with livestock business, to increase revenue of oil palm planters.
Source: InfoSAWIT Data Centre 2010

Fact 65
The proportion of land usage for oil palm is relatively smaller compared to that of forest conservation including national parks and protected forest.
Source: Ministry of Forestry Republic of Indonesia, Ministry of Agriculture Republic of Indonesia, InfoSAWIT Data Centre (2009)

Fact 66

The application of palm oil wastewater from anaerobic ponds with Biochemical Oxygen Demand (BOD) of 3500-5000 mg/liter and oil palm empty fruit bunches (TKKS) in the garden can supply nutrients of N, K and organic matters. Nutrient contents of wastewater are 450 mg N / l, 80 mg P / l, 1250 mg K / l and 215 mg/l. Wastewater application system can be done with sprinkle system (water shine), flatbed (through pipes to tanks into a ditch secondary distribution), longbed (To the straight and winding ditch) and the tractor tank (wastewater transport from WWTP: Waste Water Processing Installation) to the planting areas. Applications by 60 TKKS ton/ha/year to replace all the N and K fertilizer. Each processing of 1 ton of FFB will produce solid waste in the form of oil palm empty fruit bunches (EFB) as much as 200-250 kg and 650 liters of wastewater.
Source: Ministry of Agriculture Republic of Indonesia (2007)
Photo: PT Smart Tbk.

Fact 64
Oil palm leaves and cake can be used as animal feed. Nutritional composition of the meal of palm kernel are: crude protein 15.14%, 6.08% crude fat, crude fiber 17.18%, 0.47% calcium, phosphorus 0.72% and BETN digestibility value of 57.80% and gross energy of 5088 kcal/kg.
Source: Widjastuti, et. al (2004)

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Comparison Land Area with Forest Area and Palm Oil Plantations (million ha)
Indonesia Land Area 187.7 million ha
44.11 % 26.32 %

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3.89 %
Production Forests Conservation Forests & Protected Palm Oil Plantations

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Fact 67
Indonesian palm oil company is committed to its Corporate Social Responsibility (CSR) in accordance with Law No. 40 of 2007 about limited liability companies.
Source: Ministry of Forestry of Indonesia, Ministry of Agriculture Republic of Indonesia, InfoSAWIT Data Centre (2009)

Fact 68
Through CSR programs, oil palm companies help the development of elementary and secondary schools to community around the plantation. In addition, they are given all the learning facilities and infrastructure to support learning activities in school.
Source: InfoSAWIT Data Centre (2010)

CSR programs in the Indonesian Palm Oil Company


Sectors Activities
1. Establishing the school buildings 2. Improving and increasing educational infrastructure such as laboratories, library, computers, etc. 3. Improving teachers welfare 4. Provide scholarships for clever students 5. Providing the school textbooks 6. Giving school guidance and education to become pre-eminent school 1. Providing optimal health care to society through hospitals and clinics that exist 2. Improving and increasing the health infrastructure such as pharmaceuticals, vaccination, and medical equipment 3. Giving health education and free medical treatment to villages around plantation (mill) 1. Buiding of infrastructure and equipment and encouraging worship development of religious activities 2. Constructing and repairing the roads and transportation infrastructure of the village to go to proper city 3. Constructing of village facilities such as police stations and community halls 4. Development and improvement of sports facilities such as soccer field Social Programs 5. Development and improvement of water supply such as wells drilled and facilities bath wash toilet (MCK), a healthy 6. Construction and repair of the dike 7. Organize youth activities such as various forms of tournament exercise, blood donors 8. Natural disaster relief 1. Applying best practice management of oil palm plantations 2. Establish areas for conservation HCV3. Conserving biodiversity in oil palm plantation 4. Implement integrated pest and disease control 5. Implementing RSPO principles and criteria in the areas of oil palm growers and mills 1. Training related to the business of oil palm and plantation 2. Increasing income communities with the Partnership program Inti-Plasma 3. Deceive the public as a supplier of daily necessities employees around the factory or plantation 4. Lending to the community oil palm seedlings 5. Cooperative employee garden Directing people to use clean water and healthy sanitary facilities Preventing flooding Promote unity between citizens and employees or plantation and mill Streamlining the existing transportation

Advantages
Improving teaching and learning activities, in order to improve the quality of education, especially in the vicinity of plantations and factorie

Education

Fact 69
Solid waste and wastewater in POM can be utilized as an energy source. The wastewater from a capacity of 30 tons of POM/h with the total of POM is 146.000 tons/year can produce 1 MW electricity. If the EFB is used as an energy source through the boiler-steam turbine system , it is expected to generate electricity by 2.5 MW. Excess energy can be used as an energy source for PKO plant or sold to the community.
Source: InfoSAWIT Data Centre (2009)

Health

Community awareness about the importance of health

Fact 70
Develop nature conservation

Program Pelestarian Lingkungan

Smallholders of oil palm do taungya system of cultivation to overcome daily food needs when oil palm plantations havent produced product yet.
Source: InfoSAWIT Data Centre (2010)

Economy

Increase revenue of community

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Fact 71
Oil palm plantation companies ia allocating conservation area to preserve the habitat of orangutans and other protected species and to support the efforts of preserve the fauna.
Source: Indonesian Oil Palm Society , Thohari (2010)
9 10 11 12 13 Kareo padi Trinil Punai kecil Punai Tekukur Delimukan zamrud Bayan Srindit melayu Bubut alang-alang Beluk ketupa Kukuk beluk Taktarau melayu Walet sapi Pekaka emas Raja udang meninting Cekakak batu Kangkareng perut-putih Takur warna warni Takur tenggeret Takur ampis Pelatuk besi Caladi batu Sempur hujan sungai Cica daun kecil Cica daun besar Merbah Srigunting Srigunting gagak Kacer Murai batu Cinenen kelabu Sikatan rimba dada kelabu Sikatan hijau laut Sikatan belang Kipasan mutiara Kipasan belang Seriwang asia Kerak jambul Tiong emas Burung madu sepah raja Pijantung kecil Amaurornis phoenicurus Tringa sp Treron olax Treron sp. Streptopelia chinensis Chalcophaps indica Tanygnathus sp Loriculus galgulus Centropus bengalensis Ketupa ketupu Strix leptogrammica Eurostopodus temminckii Collocalia esculenta Pelargopsis capensis Alcedo meninting Lacedo pulchella Anthracoceros albirostris Megalaima mystacophanos Megalaima australis Calorhamphus fuliginosus Dinopium javanenses Meiglytes tristis Cymbirhynchus macrorhynchus Chloropsis cyanopogon Chloropsis sonnerati Pycnonotus goiavier Dicrurus panadiseus Dicrurus annectans Copsychus saularis Copsychus malabaricus Orthotomus ruficeps Rhinomyas umbratilis Eumyas thalassina Ficedula westermanni Rhipidura perlata Rhipidura javanica Tersiphone paradisi Acridotheres cristatellus Gracula religiosa Aethopyga siparaja Arachnothera longirostra Rallidae Scolopacidae Columbidae Columbidae Columbidae Columbidae Psittcidae Psittcidae Cuculidae Strigiformes Strigiformes Caprimulgidae Apodidae Alcedinidae Alcedinidae Alcedinidae Bucerotidae Capitonidae Capitonidae Capitonidae Picidae Picidae Eurylaimidae Chloropseidae Chloropseidae Pycnonotidae Dicruridae Dicruridae Turdidae Turdidae Silviidae Muscicapidae Muscicapidae Muscicapidae Muscicapidae Muscicapidae Muscicapidae Sturnidae Sturnidae Nectariniidae Nectariniidae Protected (PP no 7 tahun 1999) Protected (PP no 7 tahun 1999) Protected (PP no 7 tahun 1999) Protected (PP no 7 tahun 1999)

The Presence of Wildlife in The Area of Lease Rights Owned Indonesian Oil Palm Plantation
No
I 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 II 1 2 3 4 5 6 7 8

14 15 16 17

Animals Names
MAMALIA Rindil bulan Tupai kecil Tuoai Tupai akar Codot kecil kelabu Codot sayap totol Kukang bukang Trenggiling peusing/ahom Monyet kra Monyet beruk Owa kalawat Bajing kelapa Bajing gunung Bajing tanah moncong runcing Landak raya Angkis ekor panjang Beruang madu/behuang Sigung Musang Macan akar Babi Pelanduk kancil Kijang muntjak BURUNG Bambangan hitam Elang ikan kepala kelabu Elar ular bido Elang hitam Elang bondol Puyuh kepala merah Puyuh sengayan/sio Sempidan biru/belonge

Latin Name

Family

Status

Echinosorex gymnurus Tupaia minor Ptilocercus lowii Tupaia glis Pentethor lucasii Balionycteris maculata Nycticebus coucang borneanus Manis javanica Macaca fascicularis Macaca nemestrina Hylobates muelleri Callosciurus notatus Dremomys everetti Rhinosciurus laticaudatus Hystrix brachyura Trichys fasciculata Helarctos malayanus Mydaus javanensis Paradoxurus hermaphroditus Felis bengalensis Sus sp. Tragulus javanicus Muntiacus muntjak

Erinaceidae Tupaiidae Tupaiidae Tupaiidae Pteropodidae Pteropodidae Lorisidae Manidae Cercopithecidae Cercopithecidae Hylobatidae Scuridae Scuridae Scuridae Hystricidae Hystricidae Ursidae Mustelidae Viverridae Felidae Suidae Tragulidae Cervidae

Protected (PP no 7 tahun 1999) Protected (PP no 7 tahun 1999) Vulnerable (IUCN) Endangered (IUCN) Protected (PP no 7 tahun 1999) Protected (PP no 7 tahun 1999) Protected (PP no 7 tahun 1999) Protected (PP no 7 tahun 1999) Protected (PP no 7 tahun 1999) Protected (PP no 7 tahun 1999) Protected (PP no 7 tahun 1999) Protected (PP no 7 tahun 1999)

18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41

Dupetor flavicollis Ichthyophaga ichthyaetus Spilornis cheela Ictinaetus malayensis Haliastur indus Haematortyx sanguiniceps Rollulus rouloul Lophura ignita

Ardeidae Accipitridae Accipitridae Accipitridae Accipitridae Phasinidae Phasinidae Phasinidae

42 43 44 45 46 47 48 49

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Fact 73
50 51 52 53 54 III 1 2 3 4 5 6 7 8 9 10 11 Pijantung besar Cabai tunggir coklat Kacamata biasa Bondol Kalimantan Burung Gereja REPTIL Kobra Ular banyu biawak Ular belang Ular Tanah Ular daun Toke Kadal Labi-labi Kura-kura Senyulong Naja sp. Phyton reticulatus Varanus boornensis Bungarus candidus Calloselasma rhodostoma Dryophis prasinus Gekko gecko Mabouya multifasciata Chitra indica Ortlitia boornensis Tomistoma schlegelii Elipidae Phytonidae Varanidae Elapidae Viperidae Colubridae Gekkonidae Scincidae Trionycidae Emydidae Crocodylidae Protected (PP no 7 tahun 1999) Protected (PP no 7 tahun 1999) Arachnothera robusta Diaceum everetti Zosterops palpebrosus Lonchura fuscans Passer montanus Nectariniidae Dicaeidae Zosteropidae Ploceidae Ploceidae -

Nucleus Estate Smallholder (NES) program was designed in 1974/75 by the government and started to be realized first time in 1977/78 in Alue Red (North Aceh) and Tabenan (South Sumatera) with rubber as a plantation crop. The aim of NES program is to raise the dignity of life of farmers and their families by increasing production and revenues farmer. In this concept of private plantation companies and plantation country serves as the core, while smallholders as plasma or participants. Oil palm NES started in 1980/81 in two locations: the local palm oil NES in Labuhan Batu and Langkat, North Sumatera. Further development palm oil NES spread to various parts of the country, among others: NES V Lebak (West Java), and NES V Ngabang Lok I Parindu (West Kalimantan), NES VII Sand (East Kalimantan),NES VII Luwu (South Sulawesi), special NES II in Jayapura and Manokwari (Papua). This program was adopted by the Government of Indonesia to develop plantations.
Source: Ministry of Agriculture Republic of Indonesia, InfoSAWIT Data Centre (2009) Development of Farmers Smallholders Plantations No Year 1977 - 1986 1986 - 1990 1990 - 1992 2006 - 2010 Series - Seri PIR berbantuan / NES - Seri PIR khusus & lokal - Seri PIR Trans tahap I - Seri PIR Trans tahap II - Seri PIR KKPA-KTI - PIR Revitalisasi BUN Loan - Government, World Bank loan - Depkeu, KLBI, Executing Bank - KKPA (KLBI, Executing Bank) - KKPA dan UUK - Bank credit/public funds

Fact 72
Oil palm plantations save the flora which is protected by the governments laws through the establishment of protected conservation by plants area.
Source: Indonesian Oil Palm Society , Thohari (2010)

1 2 3 4

The Existence Of Flora In The HGU-Owned Indonesian Oil Palm Plantation


No
1 2 3 4 5 6 7

Latin Name
Eusideroxylon zwageri Dyera costulata Shorea leprosula Gonystylus bancanus Anisoptera grossivenia Nepenthes ampularia type green Napenthes maxima type green

Status
Protected (PP no 7 tahun 1999) Vulnerable (IUCN) Protected (PP no 7 tahun 1999) Endangered (IUCN) Vulnerable (IUCN) Vulnerable (IUCN) Protected (PP no 7 tahun 1999) Protected (PP no 7 tahun 1999)

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Fact 77
Oil palm plantations can be used for reclamation of mined areas so that the damaged and the neglected areas can be regreened again.
Source: InfoSAWIT Data Centre (2010)
Photo: FB Anggoro/Antara

Fact 74
Palm oil mills provide the installation of wastewater management in eliminating pollutants and toxic materials and also substances that can not be degraded.
Source: Ministry of Agriculture Republic of Indonesia, InfoSAWIT Data Centre (2010)

Fact 75
Wastewater management in industrial refineries, oleochemicals and other derivatives industry is done by using the eco friendly principles.
Source: Apolin, InfoSAWIT Data Centre (2010)

Fact 79
Oil palm plantations prevent soil erosion by using terracering pattern.
Source: InfoSAWIT Data Centre (2010)

Fact 76
Palm oil company protect cultural sites and historic relics which are located around the plantation areas. This policy is part of the protection of high conservation value (HCV).
Source: InfoSAWIT Data Centre (2010)

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Fact 78
Oil palm plantations keep local culture sustainable, and empower economic life of local area.
Source: InfoSAWIT Data Centre (2010)
Photo: Teguh Patriawan

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Chapter VII. Contribution of Oil Palm for CO2 Reduction

Fact 80
Palm oil has the same ability with the rain forest because oil palm grows well in tropical regions, have a very wide canopy with their function to absorb carbon dioxide in photosynthesis, and as a shelter and also as food sources for animals.
Source: Henson (1999)

Comparison of Palm Oil Plantations with the Rain Forest in Absorbing Carbon dioxide
Parametric Gross assimilation (t CO2/ha/year) Total respiration (t CO2/ha/year) Net assimilation (t CO2/ha/year) Leaf Area Index Photosynthesis Efficiency (%) Radiation Conversion Efficiency (g / M) The total biomass in the area (t / ha) Improved Biomass / year (t) The productivity of dry matter / year (t) Oil Palm Plantation 161.0 96.5 64.5 5.6 3.18 1,68 100 8.3 36.5 Rainy Forest 163.5 121.1 42.4 7.3 1.73 0.86 431 5.8 25.7

Fact 81
For every hectare per year, Oil palm plantations can produce much higher volume of biodiesel than soybean oil.
Source: Fachgentur Nachwachsende Rohstoffe (FNR) 2006

Comparison Biodiesel Production


Edible Oil Palm Oil Soybean Litre/ha/year 6,000 440

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Fact 82
Based on the analysis of life cycle (life cycle assessment) for greenhouse gases (GHG) emissions, the biodiesel can reduce emissions of up to 62% compared to that of fossil fuels.
Source: Van Zutphen (2007)

References:
1. APOLIN, Indonesian Oleochemical Manufacturers Association, 2009. 2. APOLIN, Indonesian Oleochemical Manufacturers Association, 2010. Oleochemical Industry

Biodiesel Contribution to Green House Gass Emission


No 1 2 3 4 5 6 7 8 9 10 11 12 Source of Emission Emission production of fertilizer used Released Nitrous Oxide Pesticide used Transportation and machineries used Palm Oil Factory and refinery Empty Fruit Bunches (EFB) Waste pond Transportation to Factory and refinery Biodiesel Refinery Total Production and utilization of fuel Saving from palm oil biodiesel House gas emission saving related to fossil fuel The amount (kg CO2/ ton biodiesel) 185 (11.5%) 130 (8.1%) 34 (2.1%) 89 (5.6%) 19 (1.2%) 87 (5.4%) 824 (51.5%) 36 (2.3%) 197 (12,3%) 1,601 (100%) 4,228 2,627 62%

Review dalam Rapat Dengar Pendapat Umum Komisi VI DPR. 3. APROBI, Indonesian Biofuel Manufacturers Association, 2009. 4. Badrun, Muhammad, 2010. Tonggak Perubahan Melalui PIR Kelapa Sawit Membangun Negeri. Direktorat Jenderal Perkebunan, Kementerian Pertanian Republik Indonesia, Jakarta. 5. BPS, Central Bureau of Statistics, 2009. 6. BPS, Central Bureau of Statistics, 2010. 7. Balfas, Jamal, 2009. Penelitian Pemanfaatan Batang Sawit Untuk Furnitur, Bogor. 8. Bonni TY dan Choo YM. 2000. Valuable minor constituents of commercial red palm olein: carotenoids, vitamin E, ubiquinones and sterols. J Oil Palm Resarch. 12:14-24. 9. Bonnie TYP dan Gwendoline ECL. 2006. Identification of lutein in crude palm oil and evaluation of carotenoids at various ripening stages of the oil palm fruit. Oil Palm Res. 18:189-197 10. Choudhury, N. and et al. 1995. Comparison of Palm Oil and Olive Oil: Effects on Plasma Lipids and Vitamin E in Young Adults. Am J. Cli. Nutr. 61. pp. 1043-51 11. Elisabeth, Jenny, 2009. Tren Pengembangan Specialty Fats Indonesia, Bogor. 12. FAO/WHO. 1983. CODEX Alimentarius. Vol XI. Rome. Introduction and pp. 115-130 13. Foreign Agricultural Service (FAS), United States Department of Agriculture (USDA), 2010. 14. Foreign Agricultural Service (FAS), United States Department of Agriculture (USDA), 2009. 15. Food and Nutrition Board, 2000. Dietary References Intakes for Vitamin C, Vitamin E, Selenium, and Carotenoids. Washington. National Academy Press 16. Friedel, M.C. ,1897. Sur des matires grasses trouves dans des tombes gyptiennes dAbydos. Comptes Rendu 24: 64851 17. GAPKI, Indonesian Palm Oil Association, 2010. 18. Gee, P. T., 2007. Analitycal characteristics of crude and refined palm oil and fractions. Eur J. Lipid Sci Technol 109:373-379.

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19. Gunstone, F.D., J.L. Harwood and F.B. Padley,1986. Lipid Handbook. Chapman and Hall. London, 1985. Pp. 104 dan 455, 516, 518 dan 519. 20. Hariyadi, Purwiyatno, 2010. Sepuluh Karakter Unggul Minyak Sawit. Majalah InfoSAWIT, Edisi Oktober. 21. Henson, I.E. ,1999. Comparative Ecophysiology of Palm Oil and Tropical Rainforest. Pada Oil Palm and Environment: A Malaysia Perspective (Gurmit Singh et.al., eds) Malaysian Oil Palm Growers Council, Kuala Lumpur. Pp. 9-39 22. The Ministry of Forestry Republic of Indonesia, 2010. 23. The Ministry of Trade Republic of Indonesia , 2010. 24. The Ministry of Transportation Republic of Indonesia, 2009. 25. Ministry of Industry Republic of Indonesia, 2010. 26. Ministry of Agriculture Republic of Indonesia, 2007. 27. Ministry of Agriculture Republic of Indonesia, 2009. 28. Ministry of Agriculture Republic of Indonesia, 2010. 29. Lietz G, et al. , 2001. Comparison of the effects of supplemental red palm oil and sunflower oil on maternal vitamin A status. Am Clin Nut. 74(4): 501-509. 30. Manggabarani, A. ,2009. Memaknai Sebuah Anugerah, Sumbangsih Kelapa Sawit Indonesia bagi Dunia. Direktorat Jenderal Perkebunan, Kementerian Pertanian Republik Indonesia, Jakarta. 31. Malaysian Palm Oil Council (MPOC),1991. Basic Background Information on Palm Oil. Kelana Jaya. Pp. 19. 32. Mozaffarieh, M, et al. , 2003. The role of the carotenoids, lutein and zeaxanthin, in protecting against age-related macular degeneration: A review based on controversial evidence. Nutrition Journal, vol. 2, no. 1, p. 20. 33. Muchtadi T.R., 1992. Karakterisasi Komponen Intrinsik Utama Buah Sawit (Elais guineensis Jacq) Dalam Rangka Optimalisasi Proses Ekstraksi Minyak dan Pemanfaatan Provitamin A. [Disertasi]. Bogor: Sekolah Pascasarjana Institut Pertanian Bogor. 34. Murakoshi M., et al., 1992. Potent Preventive Action of -Carotene against Carcinogenesis: Spontaneous Liver Carcinogenesis and Promoting Stage of Lung and Skin Carcinogenesis in

Mice Are Suppressed More Effectively by -Carotene Than by -Carotene. Cancer Res. 52:6583-6587. 35. Ng, T.K.W., K.C. Hayes et al. ,1992. Dietary palmitic and oleic acids exert similar effects on serum cholesterol and lipoprotein profiles in normocholesterolemic men and women. J. Am. Coll. Nutr. 11(4):pp.383-90. 36. Nurrohmat et.al., 2010. Dampak pengganda kelapa sawit. 37. Nebeling, LC, et al. ,1997, Changes in Carotenoid Intake in the United States: The 1987 and 1992 National Health Interview Surveys, Journal of the American Dietetic Association, vol. 97, no. 9, pp. 991-6. 38. Oil World, 2007. Oil World Annual - Vol 1. ISTA Mielke GmbH. Hamburg. pp Oil/Fats 36-40. 39. Oil World, 2009. Oil World Statistics Update. ISTA Mielke GmbH. Hamburg. pp 1. 40. Ong, A.S.H. and S.H. Goh, 2002. Palm oil: a healthful and cost-effective dietary component. Food Nutr. Bull. 23: 11-22. 41. Ooi CK, et al. 1996. Refining Red Palm Oil. Elais 8: 20-28. 42. Pahan, Iyung, 2006. Panduan Lengkap Kelapa Sawit: Manajemen Agribisnis dari Hulu hingga Hilir. Penebar Swadaya, Jakarta. 43. Pamin, Kabul, 1998. Seratus Tahun dan Lima Puluh Tahun Pengembangan Kelapa Sawit di Indonesia: Dari Kebun Raya Bogor Menuju Industri. Konferensi International Kelapa Sawit. 23-25 September. GAPKI. 44. Palm Oil in Human Nutrition, 1999. 45. InfoSAWIT Data Centre, 2009. 46. InfoSAWIT Data Centre, 2010. 47. PPKS, Indonesian Oil Palm Research Institute, 2009. 48. Rao LG, Guns E, Rao AV., July/august 2003. Lycopene: Its role in human health and disease. Agrofood Industry hi tech. 49. RSPO, Roundtable Sustainable Palm Oil, 2010. 50. SEAFAST, Southeast Asian Food & Agricultural Science & Technology, 2009. 51. SBRC, Surfactant Bio Research Centre, Institut Pertanian Bogor, 2009.

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52. Schalch,W,et al.,2007,Xanthophyll accumulation in the human retina during supplementation with lutein or zeaxanthin - the LUXEA (Lutein Xanthophyll Eye Accumulation) study, Archives of Biochemistry and Biophysics, vol. 458, no. 2, pp. 128-35. 53. Scrimshaw N.S., 2000. Nutritional potential of red palm oil for combating vitamin A deficiency. Food and Nutrition Bulletin. 21(2):195-201 54. Slover H.T., 1971. Tocopherols in foods and fats, Lipids. Page 291-296 55. Sulaswatty, Ani, 1998. Karakteristik Pemekatan Beta-Karoten Minyak Sawit Dengan Teknik Fluida CO2 Superkritik. [Disertasi]. Bogor: Sekolah Pascasarjana Institut Pertanian Bogor. 56. Van Leeuwen R, et al., 2005. Dietary Intake of Antioxidants and Risk of Age-Related Macular Degeneration, JAMA, vol. 294, no. 24, pp. 3101-7. 57. Van Zutphen, 2007. Pada Makalah The Potential of Palm Oil for Developing Countries and Its Role in The Food and Fuel Debate, Tan Sri Datuk Dr. Yusof Basiron and Dr. Yew FK. 58. Wang, W, et al. 2007. Effect of dietary lutein and zeaxanthin on plasma carotenoids and their transport in lipoproteins in age-related macular degeneration, Am J Clin Nutr, vol. 85, no. 3, pp. 762-9. 59. Widjastuti, Tuti et. al. 2004. Pengolahan Bungkil Inti Sawit Melalui Fermentasi oleh Jamur Marasmius Sp Guna Menunjang Bahan Pakan Alternatif untuk Ransum Ayam Boiler. Universitas Padjajaran. Bandung 60. Wood, B.J. and R.H. V. Corley,1991. The Energy Balance of Palm Oil Cultivation. Proceedings of 1991 PORIM International Palm Oil Conference. Malaysian Palm Oil Board, Kuala Lumpur, pp. 130-43. 61. Yang, Y; Huang, C Y; Peng, S.S. dan Peng J., 1996. Carotenoid analysis of several dark green leafy vegetables associated with a lower risk of cancers. Biomed. Environ. Sci., 9: 386-392. 62. Zimmer, Y et al., 2009. Agri benchmark Cash Crop Report, Braunschweig.

TA M SI - D M SI P rof il e

ndonesian palm Oil Advocacy Team (TAMSI DMSI) was formed under the mandate given by DMSI based on the needs and commitment of the Indonesian Oil Palm stakeholders to develop sustainable oil palm industry, during: (1) Sawit Linkers meeting on April 23, 2010 (2) Oil Palm Industry Chairpersons and CEOs Discussion Forum on May 24, 2010 (3) DMSI Meeting on August 9, 2010 (4) Sawit Linkers Meeting on August 12, 2010. TAMSI-DMSI therefore started its activities in cooperation with various parties, such as academic, researchers, government and media players. Various discussion forums have been conducted in order to build a public discourse about issues of oil palm industry in Indonesia, and the world. Indonesias position as the largest CPO producer that has been achieved three years ago, provides the bargaining position of strength to play an important role for the worlds palm oil in the future. Even though Indonesias oil palm industry has been conducting sustainable farming practices since the beginning, but information on this practice is very limited, so that it is necessary to advocate such farming practices to the world. Various criticisms directed against Indonesia palm oil industry in the recent time, has a negative impact to the sustainability of the oil palm industry in the future. Therefore, allegations of errors being loaded, such as wild fires and destruction of forest, the killing of wild life, indigenous land hoarding and other misconducts have to be handled and overcome wisely. Various business development and improvement of sustainable oil palm plantations have been done, much progress have been achieved, but still require hard work, through the stronger cooperation between the oil palm industry stakeholders. Support is needed from the government to strengthen the leading position of Indonesia as the world champion producer of CPO, and to establish the Indonesian sustainable development of oil palm industry. Efforts from the private sector to improve sustainable oil palm farming practices have also be increased. Similarly, research and development of oil palm industry have to be improved, to help the value additions of the CPO and other oil palm products, as well as to improve sustainability of Indonesias oil palm industry in the future. Finally, TAMSI DMSI warmly invite all parties to engage actively in building sustainable oil palm industry development in Indonesia.

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w w w.tamsi-dmsi .org

Dewan Minyak Sawit Indonesia (Indonesian Palm Oil Board)


Plaza BII Menara 2, Lantai 33 Jl. MH. Thamrin No. 51 Jakarta Pusat 10350 Indonesia Telp. (62-21) 318-1255, Faks. (62-21) 318-1256 Email. ipob@dmsi.or.id, website : www.dmsi.or.id

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