Thursday, 12 March 2015


This year some of Indonesia’s premium export commodities and rubber were posting price downturn due to low global economic condition. Price of farm in 2014 went down by 2.8% against 2013. The down turning trend was predicted to continue till end of this year.

Some buyer countries like India and China were having economic slowdown so demand from the 2 countries dropped. One of the solutions was to increase absorption of palm at home to be processed in bio diesel.

The problem was according to Togar Sitanggang, Chairman of Indonesia’s Oliochemicals Indonesia, The government seemed not serious about tackling bio diesel problem “Pricing of bio-diesel by Pertamina for bio-diesel mix was not condusive to producers so they were reluctant to process CPO into vegetable fuel.” He said.

Pertamina with Government’s approval stipulated price of diesel based on Mean Oil Plats Singapore (MOPS) which was said to be most appropriate for Indonesia. Pricing caused producers to lost USD 200/tons.

“The Government must not sit on their laurels. Unless actions were taken the bio industry at home would die,” he said. Today the government was evaluating production of bio-diesel for the next tender. Togar was expecting that the MOPS formula be eliminated, to be replaced by other formula which was more profitable. Or else the Government’s target to use bio-diesel with 20% mix would be delayed.

Tony L. apalm researcher predicted that the condition of low CPO price might last long. The Government could no longer rely on CPO as source of income.

Many things could be produced of palm wastage to increase income. From the liquid pool for example with methane capture technology electricity could be produced. PLN would take any amount of power at profitable price.

Besides, improved processing technology might increase yields today from wastage which contained 5% oil. To some European state such was extremely high because their rape seed had only 1.5% yield. So even palm wastage still contained more oil.

Wastage like empty plume could be used as bio energy. This was necessary because this year production cost might increase just as CPO price. Without other source of income, plantation growers would have difficulty. (SS)

Business News - February 13, 2015

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