Palm oil news January 2026
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January 31, 2026
Indonesia's Attorney General to Question Former Environment Minister Siti Nurbaya
TEMPO.CO, Jakarta - Indonesia’s Attorney General’s Office (AGO) will summon former Minister of Environment and Forestry Siti Nurbaya Bakar to testify as a witness in a corruption investigation linked to the management of palm oil plantations and the industry between 2015 and 2024.
“We will schedule it later,” said Syarief Sulaeman Nahdi, Director of Investigations at the Special Crimes Deputy Attorney General’s Office, on Friday, January 26, 2026.
The AGO’s Special Crimes Investigators conducted raids on six locations between January 28–29, 2026, including Siti Nurbaya’s residence in Jakarta. According to Syarief, investigators seized documents and electronic devices as part of the probe.
The search is related to Siti Nurbaya’s tenure as Minister of Environment and Forestry, a position she held twice under President Joko Widodo.
Law enforcement sources familiar with the investigation said that the seized materials include evidence of the flow of billions of rupiah to ministry officials. Tempo
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AGO Seizes Documents from Ex-Minister in Palm Oil Graft Probe
Jakarta. State prosecutors have seized documents and electronic evidence during searches of the home of former Environment and Forestry Minister Siti Nurbaya Bakar and several other locations as part of an investigation into alleged corruption in the governance of the palm oil plantation and industry sector.Jakarta city guide
The seizures were carried out by investigators from the Attorney General’s Office’s Special Crimes Unit, which is probing suspected irregularities in the management and regulation of oil palm plantations and downstream palm oil industries.
“There are documents and electronic evidence,” Director of Investigation Syarief Sulaeman Nahdi told reporters at the Attorney General’s Office in Jakarta on Friday.
Syarief said the materials were taken because investigators believe they are relevant to the case and will be analyzed to strengthen the evidentiary basis of the investigation. Jakarta Globe
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U.S. Producer Files New Trade Case Against Imports of Certain Fatty Acids from Indonesia and Malaysia
Vantage Specialty Chemicals, Inc. (“Petitioner”) has filed new petitions with the U.S. Department of Commerce (“DOC”) and the U.S. International Trade Commission (“ITC”) seeking the imposition of antidumping (“AD”) and countervailing duties (“CVD”) on imports into United States of certain fatty acids (“CFA”) from Indonesia and Malaysia.
The Petitioner alleges that imports of CFAs are being dumped in the U.S. market by being sold for less than fair value and that these imports are injuring the domestic producers. The imported products subject to these petitions are CFAs – which are products of chemically transformed animal fat or vegetable oil, including their derivatives.
CFAs are used in a wide variety of products including and not limited to food additives, animal feed, candles, crayons, paints, coatings, asphalt, adhesives, industrial lubricants, and rubber processing. CFAs can also be used in personal and homecare products such as soaps, fabric softeners, pharmaceuticals, detergents, and cosmetics.
Scope of the Investigation
The following language describes the imported merchandise that Petitioners intend to cover in these investigations:
The merchandise subject to these Petitions is certain fatty acids (CFA), which are organic acids made of hydrocarbon chain with a carboxylic acid group (i.e., an organic acid that contains a carboxyl group ( —C(=O)—OH) attached to an R-group, sometimes also written as R-COOH, R—C(O)OH, or R-) at one end with a carbon chain length (i.e., the number of carbon atoms in the fatty acid chain) of C6, C8, C10, C12, C14, C16, or C18, with an iodine value below 105 g/100 g and with a ratio of free fatty acids to triglycerides (also known as the “degree of split” or “DoS”)) of at least 97 percent, including single fatty acid (also referred to as “pure cut”), and blends containing a combination of two or more carbon chain lengths. Clark Hill
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Up-skilling Thai Repatriation Workers for Malaysian Palm Oil Agricultural Sector: A Labour Migration Strategy under the IMT-GT Framework
Malaysia's palm oil industry is facing a severe labor shortage, estimated to cost the industry US$4.6 billion annually. Meanwhile, Thailand's southern border provinces (Yala, Pattani, and Narathiwat) are experiencing significant unemployment among returning migrant workers. This research explores how similar challenges can be addressed through complementary solutions within the frameworks of the ASEAN Economic Community (AEC) and the Indonesia-Malaysia-Thailand Growth Triangle (IMT-GT). Using qualitative research methods, data collection included in-depth interviews, focus group discussions, and document analysis. The informants were divided into three groups: 12 central and local government officials; 60 Thai repatriation workers residing in the three southern border provinces; and 8 Malaysian entrepreneurs owning palm oil plantations and factories located near the Thai-Malaysian border. The study examines the required labor skills for Malaysian palm oil plantations, the readiness of Thai workers, and the potential social and economic impacts of labor migration. The results indicate that 60% of the returning Thai workers in the sample group expressed a strong interest in working in the palm oil industry. The study found significant wage disparities (THB 15,000 per month in Malaysia compared to THB 4,000-5,000 in Thailand), potentially generating an average annual remittance of THB 120,000. However, the research identified several major obstacles, including outdated bilateral agreements, inadequate training infrastructure, and a lack of certification systems. Based on these findings, the research proposes a five-module training curriculum integrating theoretical instruction (40%) with 4-6 weeks of practical field training (60%), aligned with Malaysian standards and the IMT-GT framework. Policy recommendations emphasize the need to improve memoranda of understanding, sector-specific frameworks, certification systems, and monitoring mechanisms. Analysis suggests that effective implementation of this model could address Malaysia's labor shortage, create significantly higher-paying employment opportunities for Thai workers, and contribute to peacebuilding in conflict-affected regions. FrontiersIn
Indonesia's Attorney General to Question Former Environment Minister Siti Nurbaya
TEMPO.CO, Jakarta - Indonesia’s Attorney General’s Office (AGO) will summon former Minister of Environment and Forestry Siti Nurbaya Bakar to testify as a witness in a corruption investigation linked to the management of palm oil plantations and the industry between 2015 and 2024.
“We will schedule it later,” said Syarief Sulaeman Nahdi, Director of Investigations at the Special Crimes Deputy Attorney General’s Office, on Friday, January 26, 2026.
The AGO’s Special Crimes Investigators conducted raids on six locations between January 28–29, 2026, including Siti Nurbaya’s residence in Jakarta. According to Syarief, investigators seized documents and electronic devices as part of the probe.
The search is related to Siti Nurbaya’s tenure as Minister of Environment and Forestry, a position she held twice under President Joko Widodo.
Law enforcement sources familiar with the investigation said that the seized materials include evidence of the flow of billions of rupiah to ministry officials. Tempo
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AGO Seizes Documents from Ex-Minister in Palm Oil Graft Probe
Jakarta. State prosecutors have seized documents and electronic evidence during searches of the home of former Environment and Forestry Minister Siti Nurbaya Bakar and several other locations as part of an investigation into alleged corruption in the governance of the palm oil plantation and industry sector.Jakarta city guide
The seizures were carried out by investigators from the Attorney General’s Office’s Special Crimes Unit, which is probing suspected irregularities in the management and regulation of oil palm plantations and downstream palm oil industries.
“There are documents and electronic evidence,” Director of Investigation Syarief Sulaeman Nahdi told reporters at the Attorney General’s Office in Jakarta on Friday.
Syarief said the materials were taken because investigators believe they are relevant to the case and will be analyzed to strengthen the evidentiary basis of the investigation. Jakarta Globe
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U.S. Producer Files New Trade Case Against Imports of Certain Fatty Acids from Indonesia and Malaysia
Vantage Specialty Chemicals, Inc. (“Petitioner”) has filed new petitions with the U.S. Department of Commerce (“DOC”) and the U.S. International Trade Commission (“ITC”) seeking the imposition of antidumping (“AD”) and countervailing duties (“CVD”) on imports into United States of certain fatty acids (“CFA”) from Indonesia and Malaysia.
The Petitioner alleges that imports of CFAs are being dumped in the U.S. market by being sold for less than fair value and that these imports are injuring the domestic producers. The imported products subject to these petitions are CFAs – which are products of chemically transformed animal fat or vegetable oil, including their derivatives.
CFAs are used in a wide variety of products including and not limited to food additives, animal feed, candles, crayons, paints, coatings, asphalt, adhesives, industrial lubricants, and rubber processing. CFAs can also be used in personal and homecare products such as soaps, fabric softeners, pharmaceuticals, detergents, and cosmetics.
Scope of the Investigation
The following language describes the imported merchandise that Petitioners intend to cover in these investigations:
The merchandise subject to these Petitions is certain fatty acids (CFA), which are organic acids made of hydrocarbon chain with a carboxylic acid group (i.e., an organic acid that contains a carboxyl group ( —C(=O)—OH) attached to an R-group, sometimes also written as R-COOH, R—C(O)OH, or R-) at one end with a carbon chain length (i.e., the number of carbon atoms in the fatty acid chain) of C6, C8, C10, C12, C14, C16, or C18, with an iodine value below 105 g/100 g and with a ratio of free fatty acids to triglycerides (also known as the “degree of split” or “DoS”)) of at least 97 percent, including single fatty acid (also referred to as “pure cut”), and blends containing a combination of two or more carbon chain lengths. Clark Hill
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Up-skilling Thai Repatriation Workers for Malaysian Palm Oil Agricultural Sector: A Labour Migration Strategy under the IMT-GT Framework
Malaysia's palm oil industry is facing a severe labor shortage, estimated to cost the industry US$4.6 billion annually. Meanwhile, Thailand's southern border provinces (Yala, Pattani, and Narathiwat) are experiencing significant unemployment among returning migrant workers. This research explores how similar challenges can be addressed through complementary solutions within the frameworks of the ASEAN Economic Community (AEC) and the Indonesia-Malaysia-Thailand Growth Triangle (IMT-GT). Using qualitative research methods, data collection included in-depth interviews, focus group discussions, and document analysis. The informants were divided into three groups: 12 central and local government officials; 60 Thai repatriation workers residing in the three southern border provinces; and 8 Malaysian entrepreneurs owning palm oil plantations and factories located near the Thai-Malaysian border. The study examines the required labor skills for Malaysian palm oil plantations, the readiness of Thai workers, and the potential social and economic impacts of labor migration. The results indicate that 60% of the returning Thai workers in the sample group expressed a strong interest in working in the palm oil industry. The study found significant wage disparities (THB 15,000 per month in Malaysia compared to THB 4,000-5,000 in Thailand), potentially generating an average annual remittance of THB 120,000. However, the research identified several major obstacles, including outdated bilateral agreements, inadequate training infrastructure, and a lack of certification systems. Based on these findings, the research proposes a five-module training curriculum integrating theoretical instruction (40%) with 4-6 weeks of practical field training (60%), aligned with Malaysian standards and the IMT-GT framework. Policy recommendations emphasize the need to improve memoranda of understanding, sector-specific frameworks, certification systems, and monitoring mechanisms. Analysis suggests that effective implementation of this model could address Malaysia's labor shortage, create significantly higher-paying employment opportunities for Thai workers, and contribute to peacebuilding in conflict-affected regions. FrontiersIn
January 30, 2026
EU to phase out soy biofuels linked to deforestation
Commission research finds soy cultivation drives high ILUC emissions and biodiversity loss
The European Union will remove soy‑based biofuels from its renewable energy targets after new European Commission research confirmed they pose a high risk of deforestation and indirect land‑use change (ILUC). The recently published findings show that soy expansion contributes significantly to CO₂ emissions and biodiversity loss, reinforcing long‑standing concerns about crop‑based fuels.
The decision mirrors the EU’s earlier move to phase out palm oil biofuels by 2030 under the ILUC Delegated Act. Soy will now follow the same pathway, with regulators concluding that its production frequently expands into carbon‑rich land, undermining the climate benefits of substituting fossil fuels.
Environmental groups welcomed the findings. Cian Delaney, biofuels campaigner at Transport & Environment (T&E), said: “Soy biofuels are twice as bad for the planet as fossil diesel. Phasing them out is the right way to go and ensures that American, Argentinian and Brazilian soy does not end up in European tanks, especially now that the EU has signed the Mercosur trade deal.” He also warned that other feedstocks, including sugarcane, remain just below the EU’s high‑ILUC threshold and can still count toward renewable energy targets.
MobilityPlaza's Take
The phase‑out of soy removes one of the EU’s most damaging biofuel feedstocks, but demand for renewable transport energy continues to rise. Biofuels have long been central to EU transport policy, and under RED III, Member States must reach 29% renewables in transport by 2030, or alternatively achieve a 14.5% reduction in the GHG intensity of transport fuels.
Although the EU–Mercosur trade agreement advanced in January 2026, it still awaits scrutiny by the European Parliament and a review by the EU Court of Justice, leaving final ratification pending. This means any changes to Europe’s agri‑fuel supply chains will unfold against a still‑evolving trade framework. Meanwhile, Brazil and Argentina, two Mercosur members, remain among the world’s top three soybean producers, making EU rules on soy biofuels especially consequential for South American supply flows.
At the same time, pressure on other feedstocks is expected to increase. More than 100 million tonnes of sugarcane are currently used in global biofuel production, and this figure is projected to rise by 50% by 2030, driving new agricultural expansion. Reports already point to forest‑clearing projects in regions like Papua, Indonesia, where land conversion for sugarcane plantations is underway, underscoring ongoing ILUC concerns even as soy is phased out. Mobility Plaza
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Archipelago: The Dilemma Behind Indonesia's Biodiesel Ambition
The Indonesian government continues to spur environmentally friendly fuel programs through the development of biodisels that have now reached the B50 stage.
The program, which mixes 50 percent vegetable oil with 50 percent fossil oil, was originally conceived as a strategic step in the Renewable New Energy (EBT) transition.
However, behind the green narrative, there are serious challenges that have a direct impact on the well-being of palm oil farmers and the sustainability of forest ecosystems in Indonesia.
The National Secretary General of the Union of Palm Oil Farmers (SPKS), Sabarudin, highlighted the disparity in the allocation of subsidies that underpin the program.
By 2025, the collected palm export levy (PE) fund will amount to about Rp39 trillion, but about 90 percent of the funds will be re-channeled to subsidize biodisel programs.
This creates an irony because the funds that should have been used for the empowerment and welfare of farmers are actually enjoyed by large industries, while at the same time, high export levies are fueling a decline in the purchase price of palm oil at the farmer level.
In addition to the financial burden, the increase in the target for biodisel mixtures also triggers a new threat of deforestation due to the high demand for raw materials.
With the B50 target, at least 19 million tonnes of crude palm oil is needed out of a total national production of 50 million tonnes.
These conditions prompted the government to target the opening of 600,000 hectares of new land, with the Papuan region the main target of expansion after land availability in Sumatra and Borneo became limited and problematic.
This situation places the biodisel program in a gray zone, where the promise of environmental partiality clashes with the reality of forest destruction and economic losses for small farmers.
As a solution, the government is expected to model a more flexible Malaysian policy in determining the amount of biodiesel blends.
Such a dynamic approach is considered capable of maintaining price balance at the farmer level while suppressing massive land expansion ambitions that risk damaging the rest of Indonesia's tropical forests. SBS
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Dabeeo partners with Indonesia’s Triputra to deploy AI plantation monitoring system
Korean AI-based data intelligence firm Dabeeo said Thursday that it has signed a contract with Indonesia’s Triputra Agro Persada to deploy its AI-powered plantation monitoring system, marking a step forward in its expansion into Southeast Asia’s agricultural market.
Under the agreement, Dabeeo will apply its proprietary vision AI technology to manage Triputra’s large-scale palm oil plantations. The project goes beyond conventional satellite-based remote sensing by integrating precision agriculture monitoring with on-site operational management.
The system enables individual tree identification, health assessment and change detection using high-resolution satellite imagery combined with AI analysis. It also incorporates 3D terrain analysis and land suitability evaluation to assess overall plantation conditions. These insights are delivered through a web-based platform and mobile application, allowing real-time data sharing between field workers and headquarters.
A key feature of the collaboration is the integration of satellite intelligence with on-site operational data. For example, if harvested palm fruit is not transported from a collection point, its location is flagged on the platform. Logistics teams can then dispatch trucks along optimized routes that avoid obstacles such as flooded roads, improving transport efficiency and productivity.
Building on the Triputra partnership, Dabeeo plans to expand collaboration with other major palm oil producers in Indonesia. The company has previously worked with TSE Group, Salim Group and Posco Group, and aims to broaden its client base to include global agribusinesses.
“This contract demonstrates that Dabeeo’s solution has been recognized as an integrated platform combining precision agriculture monitoring with field-level operational management,” said Victor Choi, vice president of Dabeeo. “By linking satellite AI analysis with customer data, we are enabling solutions that can be applied directly to real-world farm operations, and we plan to expand from Indonesia into Malaysia.” Korea Herald
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Redesigning Nigeria’s flawed path to palm oil revival
The Federal Government’s decision to initiate the cultivation of 100 million palm oil trees, though commendable, does not constitute a silver bullet that would cure the reversal of fortune that decades of neglect have foisted on the country.
Nigeria, once the world’s largest producer of palm oil, is now nestled in the fifth position in the pecking order and spends a princely $600 million yearly importing palm oil, despite having the natural resources and historical expertise to produce it locally.
In addition, the National Bureau of Statistics’ (NBS) Foreign Trade Reports over time show that Crude Palm Oil (CPO) and palm oil fractions consistently top the country’s agricultural imports, with import values exceeding N100 billion every year.
Falling from its enviable position of controlling 40 per cent of the global market, to importing about 50 per cent of palm oil used locally did not just happen suddenly, it took decades to manifest as a result of diverse missteps, policy failures, use of low-yielding seedlings, failure to invest in plantations, smuggling and cross-border arbitrage, poor processing capacity, deployment of outdated technology, structural challenges, competition from cheap imports from West African and South-East Asian nations, as well as issues bordering on land and access to land.
The consequences of Nigeria’s shift from global leader to net importer have manifested in many ways, including draining the country’s finances. For instance, in 2021, the country imported 309,911 Metric Tonnes (MT) of palm oil from Malaysia. In 2022, the imported quantity stood at 227,035 MT, and jumped to 304,043 metric tonnes in 2023. This was a 77,008 MT increase from 2022.
The devaluation of the naira and increased local production of palm fruits notwithstanding, data from the Malaysian Palm Oil Council (MPOC) further indicated that Nigeria’s imports of Malaysian Palm Oil surged by 34 per cent in 2023.
While years of stagnant output growth and rising local demand have stretched the country’s capacity to its elastic limits, a decline in the international price of crude palm oil, experts say, always leads to increased palm oil imports, as well as smuggling from neighbouring West African countries.
When Nigeria led the pack in the 1960s and 1970s, present-day palm oil giants from South-East Asia – Malaysia, Indonesia and Thailand – were either not in the frame or had not yet begun commercial palm oil production.
Indeed, according to experts, when Nigeria had extensive oil palm plantations, Malaysia and Indonesia, which lacked genetic diversity, visited Nigeria to acquire oil palm genetic resources and exchange planting materials.
Today, many Nigerian smallholder farmers are embracing the “Malaysian supergene,” a high-yielding, genetically superior oil palm variety, in their bid to improve productivity.
Recently, the Plantation Owners Forum of Nigeria (POFON) explained that 80 per cent of palm oil planted areas were either wild trees or managed by smallholders and medium-sized plantations with an estimated oil yield of fewer than 0.5 tonnes per hectare. Twenty per cent of the planted areas are managed by commercial estates with an estimated oil yield of 1 to 2.3 tonnes per hectare. This gap between production and demand has led Nigeria to become a net importer of palm oil to meet local demand.
Before the latest moves by the Federal Government, the Central Bank of Nigeria (CBN) launched the Oil Palm Development Initiative in 2019 to reverse the trend and reduce dependence on imports. This was after palm oil production dropped to 1.12 million metric tonnes in 2018, prompting national concern.
The bank then confirmed that the country was spending millions of dollars yearly on importing palm oil, putting further pressure on and depleting its foreign exchange reserves. That initiative, which targeted the establishment of 100,000 hectares of plantations in the short term and 500,000 hectares in the long term, was adjudged not as successful as envisaged despite stakeholders across the value chain, including smallholders, commercial farmers, and processors, being offered low-interest and long-term loans.
The bank reportedly partnered with 11 South-East and South-South states in implementing the initiative, which also restricted access to foreign exchange for palm oil imports.
A further suggestion that the initiative may not have achieved its expected goal can be gleaned from the National Palm Produce Association of Nigeria (NPPAN) in 2021, which called on the CBN to set aside a minimum of N200 billion in intervention funds to support smallholder oil palm farmers under the initiative. GuardianNG
EU to phase out soy biofuels linked to deforestation
Commission research finds soy cultivation drives high ILUC emissions and biodiversity loss
The European Union will remove soy‑based biofuels from its renewable energy targets after new European Commission research confirmed they pose a high risk of deforestation and indirect land‑use change (ILUC). The recently published findings show that soy expansion contributes significantly to CO₂ emissions and biodiversity loss, reinforcing long‑standing concerns about crop‑based fuels.
The decision mirrors the EU’s earlier move to phase out palm oil biofuels by 2030 under the ILUC Delegated Act. Soy will now follow the same pathway, with regulators concluding that its production frequently expands into carbon‑rich land, undermining the climate benefits of substituting fossil fuels.
Environmental groups welcomed the findings. Cian Delaney, biofuels campaigner at Transport & Environment (T&E), said: “Soy biofuels are twice as bad for the planet as fossil diesel. Phasing them out is the right way to go and ensures that American, Argentinian and Brazilian soy does not end up in European tanks, especially now that the EU has signed the Mercosur trade deal.” He also warned that other feedstocks, including sugarcane, remain just below the EU’s high‑ILUC threshold and can still count toward renewable energy targets.
MobilityPlaza's Take
The phase‑out of soy removes one of the EU’s most damaging biofuel feedstocks, but demand for renewable transport energy continues to rise. Biofuels have long been central to EU transport policy, and under RED III, Member States must reach 29% renewables in transport by 2030, or alternatively achieve a 14.5% reduction in the GHG intensity of transport fuels.
Although the EU–Mercosur trade agreement advanced in January 2026, it still awaits scrutiny by the European Parliament and a review by the EU Court of Justice, leaving final ratification pending. This means any changes to Europe’s agri‑fuel supply chains will unfold against a still‑evolving trade framework. Meanwhile, Brazil and Argentina, two Mercosur members, remain among the world’s top three soybean producers, making EU rules on soy biofuels especially consequential for South American supply flows.
At the same time, pressure on other feedstocks is expected to increase. More than 100 million tonnes of sugarcane are currently used in global biofuel production, and this figure is projected to rise by 50% by 2030, driving new agricultural expansion. Reports already point to forest‑clearing projects in regions like Papua, Indonesia, where land conversion for sugarcane plantations is underway, underscoring ongoing ILUC concerns even as soy is phased out. Mobility Plaza
--------
Archipelago: The Dilemma Behind Indonesia's Biodiesel Ambition
The Indonesian government continues to spur environmentally friendly fuel programs through the development of biodisels that have now reached the B50 stage.
The program, which mixes 50 percent vegetable oil with 50 percent fossil oil, was originally conceived as a strategic step in the Renewable New Energy (EBT) transition.
However, behind the green narrative, there are serious challenges that have a direct impact on the well-being of palm oil farmers and the sustainability of forest ecosystems in Indonesia.
The National Secretary General of the Union of Palm Oil Farmers (SPKS), Sabarudin, highlighted the disparity in the allocation of subsidies that underpin the program.
By 2025, the collected palm export levy (PE) fund will amount to about Rp39 trillion, but about 90 percent of the funds will be re-channeled to subsidize biodisel programs.
This creates an irony because the funds that should have been used for the empowerment and welfare of farmers are actually enjoyed by large industries, while at the same time, high export levies are fueling a decline in the purchase price of palm oil at the farmer level.
In addition to the financial burden, the increase in the target for biodisel mixtures also triggers a new threat of deforestation due to the high demand for raw materials.
With the B50 target, at least 19 million tonnes of crude palm oil is needed out of a total national production of 50 million tonnes.
These conditions prompted the government to target the opening of 600,000 hectares of new land, with the Papuan region the main target of expansion after land availability in Sumatra and Borneo became limited and problematic.
This situation places the biodisel program in a gray zone, where the promise of environmental partiality clashes with the reality of forest destruction and economic losses for small farmers.
As a solution, the government is expected to model a more flexible Malaysian policy in determining the amount of biodiesel blends.
Such a dynamic approach is considered capable of maintaining price balance at the farmer level while suppressing massive land expansion ambitions that risk damaging the rest of Indonesia's tropical forests. SBS
--------
Dabeeo partners with Indonesia’s Triputra to deploy AI plantation monitoring system
Korean AI-based data intelligence firm Dabeeo said Thursday that it has signed a contract with Indonesia’s Triputra Agro Persada to deploy its AI-powered plantation monitoring system, marking a step forward in its expansion into Southeast Asia’s agricultural market.
Under the agreement, Dabeeo will apply its proprietary vision AI technology to manage Triputra’s large-scale palm oil plantations. The project goes beyond conventional satellite-based remote sensing by integrating precision agriculture monitoring with on-site operational management.
The system enables individual tree identification, health assessment and change detection using high-resolution satellite imagery combined with AI analysis. It also incorporates 3D terrain analysis and land suitability evaluation to assess overall plantation conditions. These insights are delivered through a web-based platform and mobile application, allowing real-time data sharing between field workers and headquarters.
A key feature of the collaboration is the integration of satellite intelligence with on-site operational data. For example, if harvested palm fruit is not transported from a collection point, its location is flagged on the platform. Logistics teams can then dispatch trucks along optimized routes that avoid obstacles such as flooded roads, improving transport efficiency and productivity.
Building on the Triputra partnership, Dabeeo plans to expand collaboration with other major palm oil producers in Indonesia. The company has previously worked with TSE Group, Salim Group and Posco Group, and aims to broaden its client base to include global agribusinesses.
“This contract demonstrates that Dabeeo’s solution has been recognized as an integrated platform combining precision agriculture monitoring with field-level operational management,” said Victor Choi, vice president of Dabeeo. “By linking satellite AI analysis with customer data, we are enabling solutions that can be applied directly to real-world farm operations, and we plan to expand from Indonesia into Malaysia.” Korea Herald
--------
Redesigning Nigeria’s flawed path to palm oil revival
The Federal Government’s decision to initiate the cultivation of 100 million palm oil trees, though commendable, does not constitute a silver bullet that would cure the reversal of fortune that decades of neglect have foisted on the country.
Nigeria, once the world’s largest producer of palm oil, is now nestled in the fifth position in the pecking order and spends a princely $600 million yearly importing palm oil, despite having the natural resources and historical expertise to produce it locally.
In addition, the National Bureau of Statistics’ (NBS) Foreign Trade Reports over time show that Crude Palm Oil (CPO) and palm oil fractions consistently top the country’s agricultural imports, with import values exceeding N100 billion every year.
Falling from its enviable position of controlling 40 per cent of the global market, to importing about 50 per cent of palm oil used locally did not just happen suddenly, it took decades to manifest as a result of diverse missteps, policy failures, use of low-yielding seedlings, failure to invest in plantations, smuggling and cross-border arbitrage, poor processing capacity, deployment of outdated technology, structural challenges, competition from cheap imports from West African and South-East Asian nations, as well as issues bordering on land and access to land.
The consequences of Nigeria’s shift from global leader to net importer have manifested in many ways, including draining the country’s finances. For instance, in 2021, the country imported 309,911 Metric Tonnes (MT) of palm oil from Malaysia. In 2022, the imported quantity stood at 227,035 MT, and jumped to 304,043 metric tonnes in 2023. This was a 77,008 MT increase from 2022.
The devaluation of the naira and increased local production of palm fruits notwithstanding, data from the Malaysian Palm Oil Council (MPOC) further indicated that Nigeria’s imports of Malaysian Palm Oil surged by 34 per cent in 2023.
While years of stagnant output growth and rising local demand have stretched the country’s capacity to its elastic limits, a decline in the international price of crude palm oil, experts say, always leads to increased palm oil imports, as well as smuggling from neighbouring West African countries.
When Nigeria led the pack in the 1960s and 1970s, present-day palm oil giants from South-East Asia – Malaysia, Indonesia and Thailand – were either not in the frame or had not yet begun commercial palm oil production.
Indeed, according to experts, when Nigeria had extensive oil palm plantations, Malaysia and Indonesia, which lacked genetic diversity, visited Nigeria to acquire oil palm genetic resources and exchange planting materials.
Today, many Nigerian smallholder farmers are embracing the “Malaysian supergene,” a high-yielding, genetically superior oil palm variety, in their bid to improve productivity.
Recently, the Plantation Owners Forum of Nigeria (POFON) explained that 80 per cent of palm oil planted areas were either wild trees or managed by smallholders and medium-sized plantations with an estimated oil yield of fewer than 0.5 tonnes per hectare. Twenty per cent of the planted areas are managed by commercial estates with an estimated oil yield of 1 to 2.3 tonnes per hectare. This gap between production and demand has led Nigeria to become a net importer of palm oil to meet local demand.
Before the latest moves by the Federal Government, the Central Bank of Nigeria (CBN) launched the Oil Palm Development Initiative in 2019 to reverse the trend and reduce dependence on imports. This was after palm oil production dropped to 1.12 million metric tonnes in 2018, prompting national concern.
The bank then confirmed that the country was spending millions of dollars yearly on importing palm oil, putting further pressure on and depleting its foreign exchange reserves. That initiative, which targeted the establishment of 100,000 hectares of plantations in the short term and 500,000 hectares in the long term, was adjudged not as successful as envisaged despite stakeholders across the value chain, including smallholders, commercial farmers, and processors, being offered low-interest and long-term loans.
The bank reportedly partnered with 11 South-East and South-South states in implementing the initiative, which also restricted access to foreign exchange for palm oil imports.
A further suggestion that the initiative may not have achieved its expected goal can be gleaned from the National Palm Produce Association of Nigeria (NPPAN) in 2021, which called on the CBN to set aside a minimum of N200 billion in intervention funds to support smallholder oil palm farmers under the initiative. GuardianNG
January 29, 2026
Malaysian plantations face challenges this year
The plantation sector in Malaysia is expected to face a more challenging operating environment this year, according to a report by The Star.
Despite relatively stable production prospects, crude palm oil (CPO) prices were likely to remain range-bound amid elevated stock levels and subdued export demand, the 16 January report said.
Based on updates from the Malaysia Palm Oil Board (MPOB) at the Palm Oil Conference and Seminar (R&O 2026), MBSB Research expected CPO prices to average around MYR4,200 (US$1,061)/tonne this year, with prices forecast to trade between MYR4,000-MYR4,500 (US$1,011-US$1,137)/tonne as the year progressed.
High opening stocks and modest supply growth would put pressure on CPO prices in the first half of 2026, even as biodiesel mandates in Indonesia provided some downstream support, MPOB said.
The board said it was also expecting Malaysian palm oil production to soften this year, projecting an output of 19.5M-19.8M tonnes, down from a record 20.3M tonnes in 2025, as estates entered a biological tree-rest phase following last year’s yield rebound.
Despite this, MBSB Research said it was forecasting marginal production growth of 1%, reflecting natural yield limitations after two years of recovery.
Meanwhile, the research house said it was also projecting exports to remain soft, with shipments expected to hover around 15.8M-16M tonnes, as demand from key markets such as India, China and the European Union (EU) remained subdued.
According to MBSB Research data, palm oil exports fell 9.7% year-on-year in 2025 to 15.3M tonnes, largely due to a narrower discount against competing vegetable oils and weaker imports from major buyers.
This had contributed to ending stocks surging to 3.05M tonnes, the highest level since February 2019, the research house said.
Commenting on 2025 overall, MBSB Research said: “Compared with 2024, planted area increased by 1.6% year-on-year to 5.7M ha, supported by higher replanting activity, mainly undertaken by private estates and government agencies. This expansion was broad-based.”
Fresh fruit bunch (FFB) yields also improved by 6.4% to 17.77 tonnes/ha, reflecting a higher proportion of mature trees and improved labour availability, it said.
MPOB said that yields had reverted to pre-pandemic levels, last seen in 2019, while oil extraction rates had benefited from stronger harvesting productivity.
Beyond supply-demand dynamics, regulatory developments were also expected to reshape the industry.
MPOB said the Sawit Intelligent Management System would be integrated into the National Traceability System this year, linking plantation mapping, sustainability certification and transactional data.
The integration aimed to “provide end-to-end data visibility” and ensure compliance with global requirements, including the EU Deforestation Regulation (EUDR), The Star wrote. OFI Magazine
--------
MMEA detains boat carrying unlicensed palm oil
SANDAKAN: The Malaysian Maritime Enforcement Agency (MMEA) detained a boat carrying seven tonnes of crude palm oil that did not have a valid ownership document and transport licence from the Malaysian Palm Oil Board (MPOB) off the waters here yesterday.
Sandakan Maritime Zone director Capt Muhamad Suhairy Hussain said two men - one aged 39 and a foreigner aged 42 - were also arrested at about 0.8 nautical miles southeast of Kampung Gas here.
"The seized boat and palm oil, valued at an estimated RM75,000, were taken to the Sandakan Maritime Zone Jetty," he said in a statement today.
He said the case is being investigated under the Malaysian Palm Oil Board Act 1998, Sabah Ports and Harbours Enactment 2002 and the Ports and Harbours (Sabah Licensed Small Ships) Regulations 2008.
Muhamad Suhairy said the MMEA will continue to intensify patrols and enforcement to curb illegal activities in the country's waters.
He urged the public to channel any information to the Sandakan Maritime Operations Centre at 089-229 504 or contact the emergency hotline 999. NST
Malaysian plantations face challenges this year
The plantation sector in Malaysia is expected to face a more challenging operating environment this year, according to a report by The Star.
Despite relatively stable production prospects, crude palm oil (CPO) prices were likely to remain range-bound amid elevated stock levels and subdued export demand, the 16 January report said.
Based on updates from the Malaysia Palm Oil Board (MPOB) at the Palm Oil Conference and Seminar (R&O 2026), MBSB Research expected CPO prices to average around MYR4,200 (US$1,061)/tonne this year, with prices forecast to trade between MYR4,000-MYR4,500 (US$1,011-US$1,137)/tonne as the year progressed.
High opening stocks and modest supply growth would put pressure on CPO prices in the first half of 2026, even as biodiesel mandates in Indonesia provided some downstream support, MPOB said.
The board said it was also expecting Malaysian palm oil production to soften this year, projecting an output of 19.5M-19.8M tonnes, down from a record 20.3M tonnes in 2025, as estates entered a biological tree-rest phase following last year’s yield rebound.
Despite this, MBSB Research said it was forecasting marginal production growth of 1%, reflecting natural yield limitations after two years of recovery.
Meanwhile, the research house said it was also projecting exports to remain soft, with shipments expected to hover around 15.8M-16M tonnes, as demand from key markets such as India, China and the European Union (EU) remained subdued.
According to MBSB Research data, palm oil exports fell 9.7% year-on-year in 2025 to 15.3M tonnes, largely due to a narrower discount against competing vegetable oils and weaker imports from major buyers.
This had contributed to ending stocks surging to 3.05M tonnes, the highest level since February 2019, the research house said.
Commenting on 2025 overall, MBSB Research said: “Compared with 2024, planted area increased by 1.6% year-on-year to 5.7M ha, supported by higher replanting activity, mainly undertaken by private estates and government agencies. This expansion was broad-based.”
Fresh fruit bunch (FFB) yields also improved by 6.4% to 17.77 tonnes/ha, reflecting a higher proportion of mature trees and improved labour availability, it said.
MPOB said that yields had reverted to pre-pandemic levels, last seen in 2019, while oil extraction rates had benefited from stronger harvesting productivity.
Beyond supply-demand dynamics, regulatory developments were also expected to reshape the industry.
MPOB said the Sawit Intelligent Management System would be integrated into the National Traceability System this year, linking plantation mapping, sustainability certification and transactional data.
The integration aimed to “provide end-to-end data visibility” and ensure compliance with global requirements, including the EU Deforestation Regulation (EUDR), The Star wrote. OFI Magazine
--------
MMEA detains boat carrying unlicensed palm oil
SANDAKAN: The Malaysian Maritime Enforcement Agency (MMEA) detained a boat carrying seven tonnes of crude palm oil that did not have a valid ownership document and transport licence from the Malaysian Palm Oil Board (MPOB) off the waters here yesterday.
Sandakan Maritime Zone director Capt Muhamad Suhairy Hussain said two men - one aged 39 and a foreigner aged 42 - were also arrested at about 0.8 nautical miles southeast of Kampung Gas here.
"The seized boat and palm oil, valued at an estimated RM75,000, were taken to the Sandakan Maritime Zone Jetty," he said in a statement today.
He said the case is being investigated under the Malaysian Palm Oil Board Act 1998, Sabah Ports and Harbours Enactment 2002 and the Ports and Harbours (Sabah Licensed Small Ships) Regulations 2008.
Muhamad Suhairy said the MMEA will continue to intensify patrols and enforcement to curb illegal activities in the country's waters.
He urged the public to channel any information to the Sandakan Maritime Operations Centre at 089-229 504 or contact the emergency hotline 999. NST
January 28, 2026
Exclusive: EU-India deal shows 'reliable partners can work for good', Costa tells Euronews
In an exclusive interview with Euronews in New Delhi, European Council President António Costa hailed the EU-India trade pact as a major economic opportunity and strategic victory in an “uncertain world.”
The EU-India trade pact struck Tuesday in New Delhi sends a "message to the international community" that "reliable partners can work for good in the world," European Council President António Costa has told Euronews' flagship morning show, Europe Today.
"The (trade deal) has great value from an economic point of view. But perhaps more important is the message that the two largest democracies in the world are sending to the international community," Costa said, speaking to Euronews' EU editor Maria Tadeo.
"It's important, it's essential to provide predictability to engage on cooperation instead of confrontation, and that reliable partners can work for good in the world."
The landmark free trade agreement between the EU and India, signed during a grandiose ceremony in New Delhi on Tuesday, is set to slash tariffs on a wide range of EU goods from wines to cars, saving EU companies an estimated €4 billion per year in customs duties.
It's also set to provide tariff relief for Indian companies, particularly on services and pharmaceuticals. The country, the fastest-growing major economy in the world, has recently been hit by punitive US tariffs, with Trump imposing an additional 25% levy on the country last August for its purchases of Russian crude.
The deal comes on the heels of the signing of another major EU trade pact with the Latin American Mercosur bloc, as Brussels aims to hedge against escalating global trading tensions and US President Donald Trump's protectionist trade policies.
Deal provides 'predictability' in 'uncertain world'
Asked whether Trump’s recent threats of an all-out trade war over Greenland had been the ultimate catalyst to seal the deal with India, Costa said: “We started these negotiations a lot of years ago, but of course when you are living in an unpredictable world, you need to provide predictability to the business (...) and to give hope and security for the citizens.”
Costa added that "in this very uncertain world", the deal shows it's possible to "provide predictability" when "reliable partners agree on trade, security, defence, and people-to-people contact."
"We are living not in the world of blocks, but in the multi-polar world," Costa continued, saying that the EU needs to "underpin" the multilateral system by upholding international law and "engaging bilaterally" with world partners.
During Tuesday's ceremony, the Council president said the deal carried deep personal symbolism for him, as he pulled out his own Overseas Indian citizen card. Costa's father's family came from the Indian state of Goa.
The agreement will now go through legal revision and translation into all official EU languages.
The European Commission will then submit it to the Council and European Parliament for approval. In parallel, India must ratify the deal domestically.
Once ratified by both sides, the agreement will enter into force, with tariff reductions and regulatory provisions phased in over up to 10 years. Euronews
---------
Malaysia aims to be sustainable aviation fuel hub, but what about low Asian demand?
Most of the demand still comes from Europe, with Malaysia aiming to produce 1 million tonnes of sustainable aviation fuel by 2028
When Hong Kong-based EcoCeres opened Malaysia’s first commercial-scale sustainable aviation fuel plant in Johor on Monday, officials pitched it as a new export segment positioned for strong growth, backed by the country’s ports, processing capacity and palm-adjacent supply chains.
The problem is that the largest buyers are still not in Asia, EcoCeres says.
“The major part of the demand is in Europe,” EcoCeres CEO Matti Lievonen told reporters at a press conference, adding that “absolutely much more than 50 per cent” of the plant’s output would go to the European market because demand in Malaysia and much of the region was still thin.
Producers could build capacity quickly, but demand in Southeast Asia was only starting to gather momentum in tandem with government mandates and long-term commitments, he said.
The fuel – typically made from used cooking oil and other waste fats – is still bought mainly by airlines and fuel suppliers meeting European blending rules, according to industry experts.
Sustainable aviation fuel (SAF) is promoted as one of the clearest near-term options to cut aviation emissions without waiting for new and green aircraft, since it can be blended into jet fuel and used in existing planes.
EcoCeres said commissioning of its Pasir Gudang facility in Johor, near Singapore, was completed in October, and the plant had been operating at a utilisation rate of 95 per cent.
The site also produces renewable diesel and renewable naphtha, with a combined maximum production capacity of 420,000 tonnes a year across sustainable aviation fuel and those other renewable products, according to the company.
The International Air Transport Association said last year that global SAF output reached about 1 million tonnes in 2024 and was expected to rise to 1.9 million tonnes in 2025, with growth projected to slow in 2026 to 2.4 million tonnes.
In Asia, the rise in demand for sustainable aviation fuel used in the industry is still low, according to EcoCeres’ Lievone.
“Singapore is 1 per cent. Also, South Korea is 1 per cent. Then, Indonesia and Malaysia are still [considering] to increase the mandate,” he told reporters.
Malaysia’s government, however, has said it wants to produce at scale.
Former Plantation and Commodities Minister Johari Abdul Ghani told parliament in early December that Malaysia was on course to produce 1 million tonnes of SAF by 2028 from two domestic facilities – the EcoCeres plant and a second project led by state energy company Petronas with a projected capacity of 650,000 tonnes.
Johari said the government would move to stop exports of used cooking oil to guarantee sufficient feedstock for SAF over time.
Petronas, Italy’s Enilive and Japan’s Euglena began construction of their Pengerang biorefinery in Johor in November, saying then that the plant would process up to 650,000 tonnes of renewable feedstock a year. The plant is expected to begin operations in the second half of 2028.
Used cooking oil is both a waste and a traded commodity. According to figures cited by the Malaysia Palm Oil Board, Malaysia exported 465,257 tonnes of used cooking oil in 2024, up from 310,368 tonnes in 2023, with Singapore as the largest importer.
The traceability of the SAF’s feedstock is non-negotiable if EcoCeres wants to sell more to heavily regulated markets, particularly in Europe.
Lievonen said the company relied on certification and detailed tracking of its feedstock supply chain, saying: “You need to trace everything, otherwise you can’t sell.”
EcoCeres could track used cooking oil back to individual suppliers in China, with a network of 350,000 restaurants that supplied the company, he added.
Over time, he said the Johor plant would draw more of its feedstock from Malaysia and the wider region, which already had deep biofuel supply chains alongside its palm oil industry. SCMP
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Indonesia Delays B50 Mandate as Malaysia Gains Edge in Global CPO Exports
PALMOILMAGAZINE, KUALA LUMPUR – Indonesia has decided to postpone the implementation of its B50 biodiesel mandate this year, citing unresolved technical readiness and funding constraints—developments that analysts say highlight deeper structural challenges in the country’s biodiesel program.
TA Securities Bhd (TA Research) noted that the delay is not merely a scheduling issue, but a reflection of several critical problems that remain unaddressed. These include the need to stabilize domestic biodiesel funding mechanisms, narrow the widening cost gap between biodiesel and fossil diesel, strengthen logistics and infrastructure, and ensure overall operational readiness.
“From a regional competitiveness perspective, our calculations show that Malaysia currently holds a cost advantage in CPO exports, supported by lower export duties that reduce costs and enhance pricing flexibility,” TA Research said in a note quoted by local media on Wednesday (January 21, 2026)
By contrast, Indonesia is facing increasing pressure from higher export levies. While these levies help finance domestic biodiesel subsidies, they also raise export costs and risk weakening Indonesia’s price competitiveness in the global palm oil market.
According to media reports, the government postponed the rollout of the 50% biodiesel blending mandate due to technical challenges and limited funding capacity. Indonesia had previously targeted the second half of 2026 for the implementation of B50.
At the same time, Jakarta is moving ahead with plans to raise the palm oil export levy from 10% to 12.5%, effective March 1, 2026. The policy is expected to strengthen fiscal revenues while continuing to support broader government programs, including biodiesel subsidies.
TA Research said it was not surprised by the decision, noting that concerns over subsidy adequacy have intensified amid the widening price gap between biodiesel and conventional diesel, compounded by reports of fiscal strain in 2024.
Bloomberg biodiesel profitability data show that Indonesia’s biodiesel margins over the past decade have been highly volatile and heavily dependent on subsidies. Margins were largely negative between 2015 and 2017, turned positive in 2018–2019, but weakened again in 2020–2021 amid low global oil prices.
Margins surged in 2022 during the global energy crisis, normalized toward breakeven levels in 2023–2024, and then slipped back into losses in 2025 through early 2026, at around minus US$200 per ton.
This implies that the Indonesian government currently needs to provide subsidies of roughly US$200 per ton of biodiesel to close the cost gap.
“Overall, Indonesia’s biodiesel program remains structurally unprofitable without subsidies. Higher blending mandates will likely increase subsidy requirements and expand fiscal risks,” TA Research said.
From a market competition standpoint, TA Research estimates that Malaysia’s lower CPO export duties give it a cost advantage of about US$103.2 per ton compared with Indonesia’s 12.5% export levy.
This gap not only lowers effective export costs for Malaysian producers, but also provides greater pricing flexibility in international markets.
As a result, Malaysian exporters are seen as better positioned to capture market share, particularly in price-sensitive destinations such as India. Indonesia, meanwhile, faces a strategic dilemma between maintaining levy revenues to fund domestic biodiesel subsidies and preserving its competitiveness in the global palm oil trade. Palm Oil Magazine
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Indonesia stocks plunge as MSCI warns of transparency risks
Nurluqman Suratman
SINGAPORE (ICIS)–Indonesian stocks tumbled on Wednesday after index provider MSCI raised alarms over market transparency and investability risks.
At 04:15 GMT, the benchmark Jakarta Composite Index was down by 7.66% at 8,292.56, marking its sharpest one-day decline in more than nine months.
Shares of Indonesian chemicals producer and sole naphtha cracker operator Chandra Asri plunged by 9.29%.
The sell-off extended to Indonesia’s palm oil sector.
Palm oil and oleochemicals major Sinar Mas Agro Resources and Technology (SMART) led the sector’s retreat, with shares diving by 8%, while palm oil plantation firm Astra Agro Lestari was down by around 4%.
In a statement released late on Tuesday, MSCI announced an immediate interim freeze on index additions and weighting increases for Indonesian securities.
The firm noted that while some local data feeds have seen minor enhancements, global investors remain wary of “possible coordinated trading behaviour that undermines proper price formation.”
The index provider signaled that the freeze is intended to “mitigate index turnover and investability risks” while regulators work on meaningful transparency improvements.
MSCI specified that more granular data, “possibly including high shareholding concentration monitoring”, is now required to restore confidence in the market’s accessibility.
It further warned that if insufficient progress is made toward these transparency goals by May this year, it will reassess the country’s classification.
MSCI said that it will reassess Indonesia’s status if transparency goals are not met by May 2026.
A negative review could trigger a weighting reduction in the MSCI Emerging Markets Index or a reclassification to “Frontier Market” status.
Such a shift would likely spark massive capital outflows from passive funds. ICIS
--------
Palm Oil Association warns new export proceeds rule could burden industry
The Indonesian Palm Oil Association (GAPKI) has warned that the government’s revised policy on Natural Resource Export Proceeds (DHE SDA) could place significant financial pressure on the palm oil industry.
Under the new regulation, exporters are required to place 100 percent of their export proceeds in state-owned banks, known collectively as Himbara, with a maximum of 50 percent allowed to be converted into rupiah. The remaining funds must be retained in the system for up to one year.
GAPKI Chairman Eddy Martono said the policy could strain companies’ cash flow, as a substantial portion of export earnings is needed to support daily operational costs.
“Having 50 percent of funds held for one year is quite burdensome, because when managed properly, operational expenses can exceed 50 percent of total revenue,” Eddy said as quoted by Katadata, on Tuesday, January 27, 2026.
He cited that companies may be forced to borrow from banks to cover operating shortfalls. While retained export proceeds can be used as collateral, such borrowing would still generate interest expenses, further increasing production costs.
He warned that rising operational costs could eventually affect market prices.
“In the end, this could also put downward pressure on crude palm oil prices,” Eddy said, adding that the impact would likely be passed on to farmers through lower prices for fresh fruit bunches (FFB).
Monitoring system
Eddy noted that oversight of export proceeds is already possible through Indonesian Central Bank’s (BI) Integrated Foreign Exchange Monitoring System (SIMODIS), which tracks export receipts starting from the issuance of export customs declarations.
If export proceeds fail to enter the domestic financial system within three months, companies receive a warning letter. Continued non-compliance can result in the suspension of export permits.
“If the funds still do not enter, export licenses are frozen, meaning the company can no longer export,” he said.
To expand placement options for exporters, the government is also preparing to introduce foreign-currency-denominated government bonds (SBN valas) in the domestic market.
These instruments will complement existing placement options, including special accounts, bank deposits, and BI instruments.
The Ministry of Finance is also currently drafting the regulatory framework for the issuance. Acting Director of Government Securities at the ministry’s Directorate General of Financing and Risk Management, Novi Puspita Wardani, said the details would be announced once the regulation is finalized.
“For the domestic market issuance, we will announce it officially once the regulation is issued. This instrument is specifically intended for DHE SDA placement,” Novi said on Monday, January 26, 2026 at the ministry’s office in Jakarta.
She cited that the planned instrument would follow a structure similar to the foreign-currency government bonds issued during the 2022 Voluntary Disclosure Program (PPS).
“The model will be similar to the domestic foreign-currency SBN issued under the 2022 program,” Novi said. “The issuance schedule will be announced publicly in due course.”
The domestic dollar-denominated bonds are expected to become one of the key investment vehicles for exporters to place their foreign exchange earnings within Indonesia, supporting the government’s broader effort to strengthen domestic foreign currency liquidity. Indonesia Business Post
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China becoming major market for Thai palm oil exports
China is increasingly becoming a major importer of Thai palm oil for its food industry, which will help reduce Thailand’s dependence on India as its only major market to date, according to Nantapong Jiralertphong, director of the Office of Trade Policy and Strategy at the Ministry of Commerce.
India currently accounts for 77% of all Thai palm oil exports, he said, adding that increasing demand from China will provide Thailand with an opportunity to reducing its dependence on a single major importer.
He said that Thailand should, however, explore the opportunity to increase the value of Thai palm oil by producing upgraded products, such as pure palm oil, organic palm oil for the baking and non-dairy creamer industries and trans-fat-free palm oil, which would meet the demand from health-conscious consumers in China.
He suggested that Thai exporters explore digital platforms, such as Alibaba or WeChat, to expand consumer bases among the B2B groups, as well as existing trade agreements, such as RCEP and ACFTA, to increase their price competitiveness and market access.
According to the American Oil Chemists’ Society, China is the world’s third largest consumer of palm oil, after Indonesia and India.
Meanwhile, Kuntida Bundhuratana, director of the Office of Foreign Trade Promotion in Chengdu in China, said that China is increasingly importing higher-quality goods, adding that this trend presents an opportunity for Thailand to upgrade its palm oil products to meet the demands of Chinese consumers.
Asanee Mallamphut, president of the Palm Oil Refinery Association, said that Thailand should try to rebrand Thai palm oil as a quality and reliable product, which gives importance to environmental protection and sustainability. Thai PBS World
Exclusive: EU-India deal shows 'reliable partners can work for good', Costa tells Euronews
In an exclusive interview with Euronews in New Delhi, European Council President António Costa hailed the EU-India trade pact as a major economic opportunity and strategic victory in an “uncertain world.”
The EU-India trade pact struck Tuesday in New Delhi sends a "message to the international community" that "reliable partners can work for good in the world," European Council President António Costa has told Euronews' flagship morning show, Europe Today.
"The (trade deal) has great value from an economic point of view. But perhaps more important is the message that the two largest democracies in the world are sending to the international community," Costa said, speaking to Euronews' EU editor Maria Tadeo.
"It's important, it's essential to provide predictability to engage on cooperation instead of confrontation, and that reliable partners can work for good in the world."
The landmark free trade agreement between the EU and India, signed during a grandiose ceremony in New Delhi on Tuesday, is set to slash tariffs on a wide range of EU goods from wines to cars, saving EU companies an estimated €4 billion per year in customs duties.
It's also set to provide tariff relief for Indian companies, particularly on services and pharmaceuticals. The country, the fastest-growing major economy in the world, has recently been hit by punitive US tariffs, with Trump imposing an additional 25% levy on the country last August for its purchases of Russian crude.
The deal comes on the heels of the signing of another major EU trade pact with the Latin American Mercosur bloc, as Brussels aims to hedge against escalating global trading tensions and US President Donald Trump's protectionist trade policies.
Deal provides 'predictability' in 'uncertain world'
Asked whether Trump’s recent threats of an all-out trade war over Greenland had been the ultimate catalyst to seal the deal with India, Costa said: “We started these negotiations a lot of years ago, but of course when you are living in an unpredictable world, you need to provide predictability to the business (...) and to give hope and security for the citizens.”
Costa added that "in this very uncertain world", the deal shows it's possible to "provide predictability" when "reliable partners agree on trade, security, defence, and people-to-people contact."
"We are living not in the world of blocks, but in the multi-polar world," Costa continued, saying that the EU needs to "underpin" the multilateral system by upholding international law and "engaging bilaterally" with world partners.
During Tuesday's ceremony, the Council president said the deal carried deep personal symbolism for him, as he pulled out his own Overseas Indian citizen card. Costa's father's family came from the Indian state of Goa.
The agreement will now go through legal revision and translation into all official EU languages.
The European Commission will then submit it to the Council and European Parliament for approval. In parallel, India must ratify the deal domestically.
Once ratified by both sides, the agreement will enter into force, with tariff reductions and regulatory provisions phased in over up to 10 years. Euronews
---------
Malaysia aims to be sustainable aviation fuel hub, but what about low Asian demand?
Most of the demand still comes from Europe, with Malaysia aiming to produce 1 million tonnes of sustainable aviation fuel by 2028
When Hong Kong-based EcoCeres opened Malaysia’s first commercial-scale sustainable aviation fuel plant in Johor on Monday, officials pitched it as a new export segment positioned for strong growth, backed by the country’s ports, processing capacity and palm-adjacent supply chains.
The problem is that the largest buyers are still not in Asia, EcoCeres says.
“The major part of the demand is in Europe,” EcoCeres CEO Matti Lievonen told reporters at a press conference, adding that “absolutely much more than 50 per cent” of the plant’s output would go to the European market because demand in Malaysia and much of the region was still thin.
Producers could build capacity quickly, but demand in Southeast Asia was only starting to gather momentum in tandem with government mandates and long-term commitments, he said.
The fuel – typically made from used cooking oil and other waste fats – is still bought mainly by airlines and fuel suppliers meeting European blending rules, according to industry experts.
Sustainable aviation fuel (SAF) is promoted as one of the clearest near-term options to cut aviation emissions without waiting for new and green aircraft, since it can be blended into jet fuel and used in existing planes.
EcoCeres said commissioning of its Pasir Gudang facility in Johor, near Singapore, was completed in October, and the plant had been operating at a utilisation rate of 95 per cent.
The site also produces renewable diesel and renewable naphtha, with a combined maximum production capacity of 420,000 tonnes a year across sustainable aviation fuel and those other renewable products, according to the company.
The International Air Transport Association said last year that global SAF output reached about 1 million tonnes in 2024 and was expected to rise to 1.9 million tonnes in 2025, with growth projected to slow in 2026 to 2.4 million tonnes.
In Asia, the rise in demand for sustainable aviation fuel used in the industry is still low, according to EcoCeres’ Lievone.
“Singapore is 1 per cent. Also, South Korea is 1 per cent. Then, Indonesia and Malaysia are still [considering] to increase the mandate,” he told reporters.
Malaysia’s government, however, has said it wants to produce at scale.
Former Plantation and Commodities Minister Johari Abdul Ghani told parliament in early December that Malaysia was on course to produce 1 million tonnes of SAF by 2028 from two domestic facilities – the EcoCeres plant and a second project led by state energy company Petronas with a projected capacity of 650,000 tonnes.
Johari said the government would move to stop exports of used cooking oil to guarantee sufficient feedstock for SAF over time.
Petronas, Italy’s Enilive and Japan’s Euglena began construction of their Pengerang biorefinery in Johor in November, saying then that the plant would process up to 650,000 tonnes of renewable feedstock a year. The plant is expected to begin operations in the second half of 2028.
Used cooking oil is both a waste and a traded commodity. According to figures cited by the Malaysia Palm Oil Board, Malaysia exported 465,257 tonnes of used cooking oil in 2024, up from 310,368 tonnes in 2023, with Singapore as the largest importer.
The traceability of the SAF’s feedstock is non-negotiable if EcoCeres wants to sell more to heavily regulated markets, particularly in Europe.
Lievonen said the company relied on certification and detailed tracking of its feedstock supply chain, saying: “You need to trace everything, otherwise you can’t sell.”
EcoCeres could track used cooking oil back to individual suppliers in China, with a network of 350,000 restaurants that supplied the company, he added.
Over time, he said the Johor plant would draw more of its feedstock from Malaysia and the wider region, which already had deep biofuel supply chains alongside its palm oil industry. SCMP
--------
Indonesia Delays B50 Mandate as Malaysia Gains Edge in Global CPO Exports
PALMOILMAGAZINE, KUALA LUMPUR – Indonesia has decided to postpone the implementation of its B50 biodiesel mandate this year, citing unresolved technical readiness and funding constraints—developments that analysts say highlight deeper structural challenges in the country’s biodiesel program.
TA Securities Bhd (TA Research) noted that the delay is not merely a scheduling issue, but a reflection of several critical problems that remain unaddressed. These include the need to stabilize domestic biodiesel funding mechanisms, narrow the widening cost gap between biodiesel and fossil diesel, strengthen logistics and infrastructure, and ensure overall operational readiness.
“From a regional competitiveness perspective, our calculations show that Malaysia currently holds a cost advantage in CPO exports, supported by lower export duties that reduce costs and enhance pricing flexibility,” TA Research said in a note quoted by local media on Wednesday (January 21, 2026)
By contrast, Indonesia is facing increasing pressure from higher export levies. While these levies help finance domestic biodiesel subsidies, they also raise export costs and risk weakening Indonesia’s price competitiveness in the global palm oil market.
According to media reports, the government postponed the rollout of the 50% biodiesel blending mandate due to technical challenges and limited funding capacity. Indonesia had previously targeted the second half of 2026 for the implementation of B50.
At the same time, Jakarta is moving ahead with plans to raise the palm oil export levy from 10% to 12.5%, effective March 1, 2026. The policy is expected to strengthen fiscal revenues while continuing to support broader government programs, including biodiesel subsidies.
TA Research said it was not surprised by the decision, noting that concerns over subsidy adequacy have intensified amid the widening price gap between biodiesel and conventional diesel, compounded by reports of fiscal strain in 2024.
Bloomberg biodiesel profitability data show that Indonesia’s biodiesel margins over the past decade have been highly volatile and heavily dependent on subsidies. Margins were largely negative between 2015 and 2017, turned positive in 2018–2019, but weakened again in 2020–2021 amid low global oil prices.
Margins surged in 2022 during the global energy crisis, normalized toward breakeven levels in 2023–2024, and then slipped back into losses in 2025 through early 2026, at around minus US$200 per ton.
This implies that the Indonesian government currently needs to provide subsidies of roughly US$200 per ton of biodiesel to close the cost gap.
“Overall, Indonesia’s biodiesel program remains structurally unprofitable without subsidies. Higher blending mandates will likely increase subsidy requirements and expand fiscal risks,” TA Research said.
From a market competition standpoint, TA Research estimates that Malaysia’s lower CPO export duties give it a cost advantage of about US$103.2 per ton compared with Indonesia’s 12.5% export levy.
This gap not only lowers effective export costs for Malaysian producers, but also provides greater pricing flexibility in international markets.
As a result, Malaysian exporters are seen as better positioned to capture market share, particularly in price-sensitive destinations such as India. Indonesia, meanwhile, faces a strategic dilemma between maintaining levy revenues to fund domestic biodiesel subsidies and preserving its competitiveness in the global palm oil trade. Palm Oil Magazine
--------
Indonesia stocks plunge as MSCI warns of transparency risks
Nurluqman Suratman
SINGAPORE (ICIS)–Indonesian stocks tumbled on Wednesday after index provider MSCI raised alarms over market transparency and investability risks.
At 04:15 GMT, the benchmark Jakarta Composite Index was down by 7.66% at 8,292.56, marking its sharpest one-day decline in more than nine months.
Shares of Indonesian chemicals producer and sole naphtha cracker operator Chandra Asri plunged by 9.29%.
The sell-off extended to Indonesia’s palm oil sector.
Palm oil and oleochemicals major Sinar Mas Agro Resources and Technology (SMART) led the sector’s retreat, with shares diving by 8%, while palm oil plantation firm Astra Agro Lestari was down by around 4%.
In a statement released late on Tuesday, MSCI announced an immediate interim freeze on index additions and weighting increases for Indonesian securities.
The firm noted that while some local data feeds have seen minor enhancements, global investors remain wary of “possible coordinated trading behaviour that undermines proper price formation.”
The index provider signaled that the freeze is intended to “mitigate index turnover and investability risks” while regulators work on meaningful transparency improvements.
MSCI specified that more granular data, “possibly including high shareholding concentration monitoring”, is now required to restore confidence in the market’s accessibility.
It further warned that if insufficient progress is made toward these transparency goals by May this year, it will reassess the country’s classification.
MSCI said that it will reassess Indonesia’s status if transparency goals are not met by May 2026.
A negative review could trigger a weighting reduction in the MSCI Emerging Markets Index or a reclassification to “Frontier Market” status.
Such a shift would likely spark massive capital outflows from passive funds. ICIS
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Palm Oil Association warns new export proceeds rule could burden industry
The Indonesian Palm Oil Association (GAPKI) has warned that the government’s revised policy on Natural Resource Export Proceeds (DHE SDA) could place significant financial pressure on the palm oil industry.
Under the new regulation, exporters are required to place 100 percent of their export proceeds in state-owned banks, known collectively as Himbara, with a maximum of 50 percent allowed to be converted into rupiah. The remaining funds must be retained in the system for up to one year.
GAPKI Chairman Eddy Martono said the policy could strain companies’ cash flow, as a substantial portion of export earnings is needed to support daily operational costs.
“Having 50 percent of funds held for one year is quite burdensome, because when managed properly, operational expenses can exceed 50 percent of total revenue,” Eddy said as quoted by Katadata, on Tuesday, January 27, 2026.
He cited that companies may be forced to borrow from banks to cover operating shortfalls. While retained export proceeds can be used as collateral, such borrowing would still generate interest expenses, further increasing production costs.
He warned that rising operational costs could eventually affect market prices.
“In the end, this could also put downward pressure on crude palm oil prices,” Eddy said, adding that the impact would likely be passed on to farmers through lower prices for fresh fruit bunches (FFB).
Monitoring system
Eddy noted that oversight of export proceeds is already possible through Indonesian Central Bank’s (BI) Integrated Foreign Exchange Monitoring System (SIMODIS), which tracks export receipts starting from the issuance of export customs declarations.
If export proceeds fail to enter the domestic financial system within three months, companies receive a warning letter. Continued non-compliance can result in the suspension of export permits.
“If the funds still do not enter, export licenses are frozen, meaning the company can no longer export,” he said.
To expand placement options for exporters, the government is also preparing to introduce foreign-currency-denominated government bonds (SBN valas) in the domestic market.
These instruments will complement existing placement options, including special accounts, bank deposits, and BI instruments.
The Ministry of Finance is also currently drafting the regulatory framework for the issuance. Acting Director of Government Securities at the ministry’s Directorate General of Financing and Risk Management, Novi Puspita Wardani, said the details would be announced once the regulation is finalized.
“For the domestic market issuance, we will announce it officially once the regulation is issued. This instrument is specifically intended for DHE SDA placement,” Novi said on Monday, January 26, 2026 at the ministry’s office in Jakarta.
She cited that the planned instrument would follow a structure similar to the foreign-currency government bonds issued during the 2022 Voluntary Disclosure Program (PPS).
“The model will be similar to the domestic foreign-currency SBN issued under the 2022 program,” Novi said. “The issuance schedule will be announced publicly in due course.”
The domestic dollar-denominated bonds are expected to become one of the key investment vehicles for exporters to place their foreign exchange earnings within Indonesia, supporting the government’s broader effort to strengthen domestic foreign currency liquidity. Indonesia Business Post
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China becoming major market for Thai palm oil exports
China is increasingly becoming a major importer of Thai palm oil for its food industry, which will help reduce Thailand’s dependence on India as its only major market to date, according to Nantapong Jiralertphong, director of the Office of Trade Policy and Strategy at the Ministry of Commerce.
India currently accounts for 77% of all Thai palm oil exports, he said, adding that increasing demand from China will provide Thailand with an opportunity to reducing its dependence on a single major importer.
He said that Thailand should, however, explore the opportunity to increase the value of Thai palm oil by producing upgraded products, such as pure palm oil, organic palm oil for the baking and non-dairy creamer industries and trans-fat-free palm oil, which would meet the demand from health-conscious consumers in China.
He suggested that Thai exporters explore digital platforms, such as Alibaba or WeChat, to expand consumer bases among the B2B groups, as well as existing trade agreements, such as RCEP and ACFTA, to increase their price competitiveness and market access.
According to the American Oil Chemists’ Society, China is the world’s third largest consumer of palm oil, after Indonesia and India.
Meanwhile, Kuntida Bundhuratana, director of the Office of Foreign Trade Promotion in Chengdu in China, said that China is increasingly importing higher-quality goods, adding that this trend presents an opportunity for Thailand to upgrade its palm oil products to meet the demands of Chinese consumers.
Asanee Mallamphut, president of the Palm Oil Refinery Association, said that Thailand should try to rebrand Thai palm oil as a quality and reliable product, which gives importance to environmental protection and sustainability. Thai PBS World
January 27, 2026
‘Palm Oil Just A Fraction of Our ASEAN Trade’: EU Says Ahead of Deforestation Law
Jakarta. The European Union, or the EU, remains upbeat that the bloc’s now-delayed anti-deforestation law will not affect its blooming trade with ASEAN despite the region being home to the world’s largest palm oil suppliers.
Palm oil producers have been keeping a close eye on the EUDR, the EU's regulation on deforestation-free products. This policy will require exporters of palm oil and other commodities linked to forest destruction to submit due diligence statements that their products do not come from deforested land. The rule has rattled Indonesia and Malaysia, which collectively make up 85% of the global palm oil supply. The Jakarta Globe recently asked EU Ambassador to ASEAN Sujiro Seam on whether the EUDR would weaken Europe’s trade with the Southeast Asian club.
“ASEAN-EU trade is extremely large. Palm oil, products concerned by deforestation, are a fraction of that trade,” Seam said in an exclusive interview with the Globe on Monday.
The diplomat went on to say that trade pacts — be it the bilateral or region-to-region level — cover a wide range of goods, not only palm oil. The EU to date already has trade agreements with two ASEAN members, and another one with Indonesia is waiting lawmakers' approval.
The 27-strong grouping has delayed the EUDR by a year until end-2026 for large operators and traders. The phase-in period for small traders lasts until June 30, 2027. Seam said that this postponement should give extra time to “address any difficulties” related to the EUDR.
“But we should focus on the big picture that nowadays, trade has become more unpredictable, with some of the ASEAN partners. The EU is the reliable, predictable, and trustworthy partner,” Seam told the Globe, alluding to the double-digit US reciprocal tariff hitting Southeast Asia.
The EU reported that it ranked as the third-biggest trading partner within ASEAN, after major powers China and the US. In 2024 alone, the EU-ASEAN trade volume amounted to EUR 258.8 billion or around $307.5 billion. Indonesian data showed that the country’s trade with the EU totaled $30.4 billion over the said period, and an upcoming trade pact is set to almost triple the numbers within a few years of its implementation. This comprehensive economic partnership agreement will also grant greater market access for Europe-bound Indonesian palm oil.
A 2019 EU report showed that Indonesia's palm oil market share within the region remained the largest at 47%. Jakarta Globe
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Indonesian government plans to introduce 1% SAF mandate in 2027
The Indonesian government has set out plans to introduce a 1% sustainable aviation fuel (SAF) mandate in 2027, rising to 5% in 2029, the Indonesian Palm Oil Association (GAPKI) wrote on 19 January.
Indonesia’s Energy Ministry bioenergy director Edi Wibowo said the development of the SAF policy was a positive step towards implementing the country’s roadmap towards net zero emissions in 2060.
The 1% SAF mandate could be introduced for international flights in 2026, according to Effendi Manurung, the ministry’s head of the Bioenergy Engineering and Environment’s renewable energy and energy conservation sub-division.
The government had not decided if the SAF mandate, which would take supply and prices into consideration, would be introduced in one step or in stages, he added.
However, as prices for 1% SAF were higher than conventional jet fuel,
it would directly impact ticket prices and there were no policy incentives for SAF use in place at the time of the report, he added.
In October 2023, SAF comprising 2.4% refined, bleached and deodorised palm kernel oil (RBDPKO) successfully completed commercial flight tests on a Boeing 737-800 NG aircraft owned by Garuda Indonesia. OFI Magazine
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Biofuels and the Ecological Transition in Europe
Sustainability, raw materials and competitiveness: the European dilemma
The two main areas in which bio-based chemistry has developed are chemical intermediates[1] and biofuels. This article focuses on the latter, with a specific emphasis on biodiesel, analysing its role in the European context of the ecological transition, at the intersection of environmental sustainability, security of raw material supply, and industrial competitiveness.
The biofuels sector encompasses a wide range of products. However, only two of them exhibit a global production scale on the order of 100 million tonnes: ethanol and biodiesel. The former is used as an additive or partial substitute for gasoline[2], while the latter is employed as an additive or substitute for diesel fuel.
Two different biodiesels
The term biodiesel actually refers to two products that are chemically very different from each other. They are obtained through distinct industrial processes, but share common feedstocks, namely vegetable oils and animal fats, either of virgin origin (such as rapeseed, palm, and soybean oils) or derived from waste streams, such as UCOs (Used Cooking Oils).
FAME biodiesel (Fatty Acid Methyl Esters):
it consists of methyl esters of fatty acids. Its physico-chemical properties differ from those of fossil diesel and, in general, its use leads to lower emissions of particulate matter, CO, and hydrocarbons at the exhaust, albeit with a possible increase in NOx emissions. In the European Union, it is typically blended with diesel fuel, with a maximum content generally ranging between 7% and 10% (B7 and B10). More recently, a B100 biodiesel has been introduced to the market for heavy-duty vehicles specifically approved for its use.
HVO diesel (Hydrotreated Vegetable Oil):
it is a paraffinic hydrocarbon obtained through hydrotreatment. It has properties very similar to those of fossil diesel, while allowing for a significant reduction in particulate matter emissions at the exhaust and in life-cycle greenhouse gas emissions. It can be used at 100% (drop-in, i.e. fully interchangeable with conventional diesel) without blending limits and is particularly well suited for modern engines, such as those compliant with the Euro 6 standard.
FAME biodiesel was introduced to the global market several decades ago, whereas HVO diesel is a more recent development. The latter, however, is rapidly gaining market share. According to data from the European Biodiesel Board (EBB), in 2019 the breakdown of the European Union market between FAME and HVO was 83% and 17%, respectively. By 2025, the share of HVO had risen to 21% and is expected to reach 23% by 2027. We are therefore witnessing a phase of progressive substitution between the two types of biofuel.
FAME biodiesel: global trade and international prices
Focusing specifically on FAME biodiesel, the European Union holds a leading position at the global level, followed by the United States. In recent years, however, these positions have become less firmly established due to the increasing competitive pressure exerted by China, as illustrated by the chart shown here. The chart depicts the shares of global FAME biodiesel trade (excluding intra-EU flows) attributable to the aggregate of EU countries, the United States, and China.
FAME biodiesel: main exporting countries Read more at Price Pedia
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SAF plant in Malaysia important to meet rising regional demand
PASIR GUDANG (Jan 27): While the majority of sustainable aviation fuel (SAF) demand comes from Europe, where current mandates reach about 2% SAF blending (1.8 million tonnes) with goals for a minimum of 6% by 2030, nations across Asia are in discussions to increase their own mandates.
For EcoCeres Renewable Fuel Sdn Bhd CEO Matti Lievonen, the launch of a SAF plant in Malaysia is strategic to capitalise on this growing market. He noted that, currently, in Asia, countries such as Singapore, South Korea, Malaysia, Indonesia, Hong Kong, and China are aiming to increase their SAF mandates. Japan is aiming for 10% blending by 2030.
“More than 50% [of EcoCeres’ SAF output] is in Europe because the market is there, but we are also building markets like in South Korea, Singapore, Japan, Hong Kong and China,” said Lievonen during a media press conference after the launch of EcoCeres’ SAF plant in Tanjung Langsat.
Today, Singapore and South Korea’s SAF mandates are only at 1% and are the main regional markets for EcoCeres.
“Johor is excellent because we get feedstock from Malaysia and other Southeast Asian countries. There is also a great seaport for global deliveries, and a really good workforce in Malaysia. We are very fortunate that we decided to come here to Johor,” said Lievonen.
Lievonen noted that the feedstock to produce SAF for the Tanjung Langsat plant — such as used cooking oils, animal fats or palm oil — is sourced from Malaysia, Southeast Asia and China, including 350,000 restaurants in China.
Though he was unable to disclose how much feedstock will come from local or overseas sources, Lievonen added that the goal is for all feedstock to come from the Southeast Asia region.
He assured that the sourcing of these feedstock remains transparent to retain its International Sustainability and Carbon Certification, which he noted SAF producers are not allowed to sell without one. The Edge
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Department of Environment suspends palm oil mill operations arrests manager
KOTA TINGGI, Jan 27 — The Johor Department of Environment (DoE) has arrested a palm oil processing mill manager to assist in investigations into a pollution incident at a stretch of Sungai Johor in Kampung Orang Asli Sayong Pinang here last Sunday.
The department has also ordered the immediate suspension of the mill’s operations in Layang-Layang, Kluang.
Johor DoE director Mohd Famey Yusoff said the arrest and suspension were carried out under Section 37© of the Environmental Quality Act 1974 to allow for a thorough investigation before the case is brought to court.
He said the department took a serious view of the incident after receiving a complaint from village representatives over river water that had turned dark.
“A team of enforcement officers was immediately deployed to the location, where a thorough investigation was conducted. This included expanding the inspection radius and tracking along the riverbed.
“Investigations found that the source of the pollution was suspected to be from a palm oil processing mill operating in the Layang-Layang area,” he said in a statement today.
Mohd Famey said a technical inspection at the premises also found serious violations, with the wastewater effluent treatment system failing to function properly. Yahoo News Malaysia
‘Palm Oil Just A Fraction of Our ASEAN Trade’: EU Says Ahead of Deforestation Law
Jakarta. The European Union, or the EU, remains upbeat that the bloc’s now-delayed anti-deforestation law will not affect its blooming trade with ASEAN despite the region being home to the world’s largest palm oil suppliers.
Palm oil producers have been keeping a close eye on the EUDR, the EU's regulation on deforestation-free products. This policy will require exporters of palm oil and other commodities linked to forest destruction to submit due diligence statements that their products do not come from deforested land. The rule has rattled Indonesia and Malaysia, which collectively make up 85% of the global palm oil supply. The Jakarta Globe recently asked EU Ambassador to ASEAN Sujiro Seam on whether the EUDR would weaken Europe’s trade with the Southeast Asian club.
“ASEAN-EU trade is extremely large. Palm oil, products concerned by deforestation, are a fraction of that trade,” Seam said in an exclusive interview with the Globe on Monday.
The diplomat went on to say that trade pacts — be it the bilateral or region-to-region level — cover a wide range of goods, not only palm oil. The EU to date already has trade agreements with two ASEAN members, and another one with Indonesia is waiting lawmakers' approval.
The 27-strong grouping has delayed the EUDR by a year until end-2026 for large operators and traders. The phase-in period for small traders lasts until June 30, 2027. Seam said that this postponement should give extra time to “address any difficulties” related to the EUDR.
“But we should focus on the big picture that nowadays, trade has become more unpredictable, with some of the ASEAN partners. The EU is the reliable, predictable, and trustworthy partner,” Seam told the Globe, alluding to the double-digit US reciprocal tariff hitting Southeast Asia.
The EU reported that it ranked as the third-biggest trading partner within ASEAN, after major powers China and the US. In 2024 alone, the EU-ASEAN trade volume amounted to EUR 258.8 billion or around $307.5 billion. Indonesian data showed that the country’s trade with the EU totaled $30.4 billion over the said period, and an upcoming trade pact is set to almost triple the numbers within a few years of its implementation. This comprehensive economic partnership agreement will also grant greater market access for Europe-bound Indonesian palm oil.
A 2019 EU report showed that Indonesia's palm oil market share within the region remained the largest at 47%. Jakarta Globe
--------
Indonesian government plans to introduce 1% SAF mandate in 2027
The Indonesian government has set out plans to introduce a 1% sustainable aviation fuel (SAF) mandate in 2027, rising to 5% in 2029, the Indonesian Palm Oil Association (GAPKI) wrote on 19 January.
Indonesia’s Energy Ministry bioenergy director Edi Wibowo said the development of the SAF policy was a positive step towards implementing the country’s roadmap towards net zero emissions in 2060.
The 1% SAF mandate could be introduced for international flights in 2026, according to Effendi Manurung, the ministry’s head of the Bioenergy Engineering and Environment’s renewable energy and energy conservation sub-division.
The government had not decided if the SAF mandate, which would take supply and prices into consideration, would be introduced in one step or in stages, he added.
However, as prices for 1% SAF were higher than conventional jet fuel,
it would directly impact ticket prices and there were no policy incentives for SAF use in place at the time of the report, he added.
In October 2023, SAF comprising 2.4% refined, bleached and deodorised palm kernel oil (RBDPKO) successfully completed commercial flight tests on a Boeing 737-800 NG aircraft owned by Garuda Indonesia. OFI Magazine
--------
Biofuels and the Ecological Transition in Europe
Sustainability, raw materials and competitiveness: the European dilemma
The two main areas in which bio-based chemistry has developed are chemical intermediates[1] and biofuels. This article focuses on the latter, with a specific emphasis on biodiesel, analysing its role in the European context of the ecological transition, at the intersection of environmental sustainability, security of raw material supply, and industrial competitiveness.
The biofuels sector encompasses a wide range of products. However, only two of them exhibit a global production scale on the order of 100 million tonnes: ethanol and biodiesel. The former is used as an additive or partial substitute for gasoline[2], while the latter is employed as an additive or substitute for diesel fuel.
Two different biodiesels
The term biodiesel actually refers to two products that are chemically very different from each other. They are obtained through distinct industrial processes, but share common feedstocks, namely vegetable oils and animal fats, either of virgin origin (such as rapeseed, palm, and soybean oils) or derived from waste streams, such as UCOs (Used Cooking Oils).
FAME biodiesel (Fatty Acid Methyl Esters):
it consists of methyl esters of fatty acids. Its physico-chemical properties differ from those of fossil diesel and, in general, its use leads to lower emissions of particulate matter, CO, and hydrocarbons at the exhaust, albeit with a possible increase in NOx emissions. In the European Union, it is typically blended with diesel fuel, with a maximum content generally ranging between 7% and 10% (B7 and B10). More recently, a B100 biodiesel has been introduced to the market for heavy-duty vehicles specifically approved for its use.
HVO diesel (Hydrotreated Vegetable Oil):
it is a paraffinic hydrocarbon obtained through hydrotreatment. It has properties very similar to those of fossil diesel, while allowing for a significant reduction in particulate matter emissions at the exhaust and in life-cycle greenhouse gas emissions. It can be used at 100% (drop-in, i.e. fully interchangeable with conventional diesel) without blending limits and is particularly well suited for modern engines, such as those compliant with the Euro 6 standard.
FAME biodiesel was introduced to the global market several decades ago, whereas HVO diesel is a more recent development. The latter, however, is rapidly gaining market share. According to data from the European Biodiesel Board (EBB), in 2019 the breakdown of the European Union market between FAME and HVO was 83% and 17%, respectively. By 2025, the share of HVO had risen to 21% and is expected to reach 23% by 2027. We are therefore witnessing a phase of progressive substitution between the two types of biofuel.
FAME biodiesel: global trade and international prices
Focusing specifically on FAME biodiesel, the European Union holds a leading position at the global level, followed by the United States. In recent years, however, these positions have become less firmly established due to the increasing competitive pressure exerted by China, as illustrated by the chart shown here. The chart depicts the shares of global FAME biodiesel trade (excluding intra-EU flows) attributable to the aggregate of EU countries, the United States, and China.
FAME biodiesel: main exporting countries Read more at Price Pedia
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SAF plant in Malaysia important to meet rising regional demand
PASIR GUDANG (Jan 27): While the majority of sustainable aviation fuel (SAF) demand comes from Europe, where current mandates reach about 2% SAF blending (1.8 million tonnes) with goals for a minimum of 6% by 2030, nations across Asia are in discussions to increase their own mandates.
For EcoCeres Renewable Fuel Sdn Bhd CEO Matti Lievonen, the launch of a SAF plant in Malaysia is strategic to capitalise on this growing market. He noted that, currently, in Asia, countries such as Singapore, South Korea, Malaysia, Indonesia, Hong Kong, and China are aiming to increase their SAF mandates. Japan is aiming for 10% blending by 2030.
“More than 50% [of EcoCeres’ SAF output] is in Europe because the market is there, but we are also building markets like in South Korea, Singapore, Japan, Hong Kong and China,” said Lievonen during a media press conference after the launch of EcoCeres’ SAF plant in Tanjung Langsat.
Today, Singapore and South Korea’s SAF mandates are only at 1% and are the main regional markets for EcoCeres.
“Johor is excellent because we get feedstock from Malaysia and other Southeast Asian countries. There is also a great seaport for global deliveries, and a really good workforce in Malaysia. We are very fortunate that we decided to come here to Johor,” said Lievonen.
Lievonen noted that the feedstock to produce SAF for the Tanjung Langsat plant — such as used cooking oils, animal fats or palm oil — is sourced from Malaysia, Southeast Asia and China, including 350,000 restaurants in China.
Though he was unable to disclose how much feedstock will come from local or overseas sources, Lievonen added that the goal is for all feedstock to come from the Southeast Asia region.
He assured that the sourcing of these feedstock remains transparent to retain its International Sustainability and Carbon Certification, which he noted SAF producers are not allowed to sell without one. The Edge
--------
Department of Environment suspends palm oil mill operations arrests manager
KOTA TINGGI, Jan 27 — The Johor Department of Environment (DoE) has arrested a palm oil processing mill manager to assist in investigations into a pollution incident at a stretch of Sungai Johor in Kampung Orang Asli Sayong Pinang here last Sunday.
The department has also ordered the immediate suspension of the mill’s operations in Layang-Layang, Kluang.
Johor DoE director Mohd Famey Yusoff said the arrest and suspension were carried out under Section 37© of the Environmental Quality Act 1974 to allow for a thorough investigation before the case is brought to court.
He said the department took a serious view of the incident after receiving a complaint from village representatives over river water that had turned dark.
“A team of enforcement officers was immediately deployed to the location, where a thorough investigation was conducted. This included expanding the inspection radius and tracking along the riverbed.
“Investigations found that the source of the pollution was suspected to be from a palm oil processing mill operating in the Layang-Layang area,” he said in a statement today.
Mohd Famey said a technical inspection at the premises also found serious violations, with the wastewater effluent treatment system failing to function properly. Yahoo News Malaysia
January 26, 2026
Europe’s trade pivot to Asia could deliver major gains for Malaysia, analysts say
Malaysia stands to reap significant economic benefits if Europe accelerates efforts to diversify its trade links towards Asia
MALAYSIA could emerge as a key beneficiary of Europe’s potential move to diversify its trade and supply chains towards Asia, particularly as demand for electronics, semiconductors, palm oil and other core commodities strengthens, analysts said.
TA Securities said Malaysia’s electrical and electronics sector is strategically positioned to capture an export upswing as global supply chains increasingly shift away from overreliance on the United States.
The firm noted that this realignment presents fresh opportunities for Malaysian manufacturers, especially amid growing uncertainties in trans-Atlantic trade relations.
However, it cautioned that challenges remain, particularly in securing access to high-technology components that are subject to US patents and export restrictions, which could limit the pace of expansion in advanced manufacturing.
In the palm oil sector, TA Securities said market opportunities in Europe remain open, but environmental and sustainability concerns continue to pose significant barriers.
The firm stressed that Malaysia must further strengthen green certification standards and sustainable practices to ensure continued access to European markets.
“If Europe diversifies its trade relations with Asia, Malaysia could benefit from stronger demand for electronics, palm oil and commodities,” it said in a research note.
Global trade sentiment has turned volatile following renewed tariff threats by US President Donald Trump after his return from the World Economic Forum in Davos.
Trump warned of imposing tariffs of up to 100 per cent on Canada should Prime Minister Mark Carney proceed with trade agreements involving China, a move widely seen as a direct response to Carney’s remarks at the summit.
Such threats are unlikely to be taken lightly by Canada, given the United States’ heavy reliance on Canadian energy supplies.
Analysts said Trump’s stance has not only unsettled markets but has also strained trans-Atlantic relations, increasing the likelihood of heightened geopolitical tensions in the near term.
The widening rift between Europe and the United States is expected to deepen scepticism towards US leadership, potentially shaping Europe’s strategic choices in the years ahead.
European leaders are now anticipated to accelerate efforts to reduce dependence on Washington economically, militarily and diplomatically, while expanding engagement with other global powers.
China and India are expected to emerge as key partners in Europe’s diversification agenda, while direct negotiations with Russia on critical issues may become more frequent, potentially sidelining US mediation altogether.
This geopolitical realignment could trigger ripple effects across financial markets. Analysts said Europe’s growing scepticism towards the US may translate into reduced holdings of US assets, weakening confidence in the dollar.
At the same time, commodities such as gold and silver are expected to gain renewed appeal as safe-haven assets amid heightened uncertainty.
Against this backdrop, TA Securities said Malaysia’s economic performance in 2025 demonstrated strong resilience despite global uncertainty driven by reciprocal tariffs and geopolitical strains.
The country’s total trade surpassed RM3 trillion for the first time, recording a trade surplus of RM151.8 billion.
The robust performance also lent support to the ringgit, underpinned by stronger-than-expected fourth-quarter 2025 gross domestic product growth of 5.7 per cent year-on-year, solid inflows from foreign tourist spending and expectations of a more accommodative US monetary policy stance.
The research firm noted that the ringgit briefly strengthened past the RM4.00 level against the US dollar last Friday and could gain further ground if the US Federal Reserve maintains a dovish narrative at its policy meeting this week, even as the US federal funds rate is expected to remain unchanged within the 3.50 to 3.75 per cent range. - January 26, 2026 The Vibes
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Indonesia's Plan for Palm Oil Self-Sufficiency under Prabowo
TEMPO.CO, Jakarta - After seeing digital documents shown by Tempo, Albertus Tenggare and Ambrosius Tenggare immediately recalled the increasingly frequent roar they had heard in recent months from the skies above Boven Digoel Regency, South Papua. "No wonder helicopters keep flying overhead," Albertus said.
That Friday afternoon, November 28, 2025, Albertus and Ambrosius went to check on Wataron, their clan's customary forest, located on the western side of the Trans-Papua highway linking Boven Digoel and Merauke. The Tenggare clan, led by Albertus, has held a participatory map of its 3,000-hectare ancestral land for the past three years, which came out about the same time as the issuance of Boven Digoel Regional Regulation No. 2/2023 on the Recognition and Protection of Indigenous Communities Rights. The Tenggare are part of the Wambon Kenemopte sub-tribe, commonly known as Mandobo.
The document shown to Tempo was a digital map referring to Forestry Minister Decree No. 591/2025. The decree signed by Minister Raja Juli Antoni reclassified 486,940 hectares of forest in the regencies of Merauke, Mappi, and Boven Digoel. According to a copy of the decree, the change was made "to support the acceleration of development in national food, energy, and water self-sufficiency zones." Forest areas overlapping with Wataron were among those redesignated as "other use zones" (APL).
Albertus' wooden house stands on the eastern edge of Wataron, beside the Trans-Papua Highway connecting Boven Digoel and Merauke. Ambrosius' hut sits directly across the road. There, they have cleared a plot roughly the size of two volleyball courts to plant chilies and fruit trees. "Just up to here, no further," Albertus said, pointing to the boundary between their fields and the forest.
Read the Complete Story in Tempo English Magazine
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High-value exports falter as Nepal’s export growth rides on re-exported edible oil
Exports of NTIS-listed products barely grow in the first half, while shipments of imported edible oil to India surge, exposing weak value addition and poor implementation of the export strategy.
Nepal’s export of high-value goods continues to struggle, with growth stalling at a meagre 1.22 percent in the first half of the current fiscal year, sharply contrasting with overall export growth of 43.76 percent during the period.
Government data show that the surge in exports has largely been fuelled by edible oil—goods Nepal does not produce domestically. According to the Department of Customs, Nepal exported goods worth Rs142.01 billion in the first six months of the current fiscal year until mid-January.
However, exports of products listed under the Nepal Trade Integrated Strategy (NTIS) 2023 reached only Rs49.64 billion during the review period, marginally up from Rs49.04 billion in the same period of the previous fiscal year.
During the period, exports of edible oil—soybean, sunflower and palm oil—jumped sharply by 155.69 percent to Rs64 billion. Nepali traders import crude edible oil and re-export it to India after processing, taking advantage of tariff concessions under the South Asian Free Trade Area (SAFTA) regime. Nepal exported 311,841 tonnes of edible oil to India during the review period.
The government implemented the revised NTIS 2023, replacing NTIS 2016, to boost exports and support Nepal’s graduation from the least developed country category by 2026. However, more than two years into its implementation, the export performance of identified potential commodities has continued to weaken.
Nepal imported 459,238 tonnes of crude soybean, sunflower and palm oil worth Rs71.22 billion in the first six months of the current fiscal year.
“The import and export data of edible oil show that Nepal has not added value and is merely re-exporting,” said Rabi Shankar Sainju, a trade expert. “If Nepal had added value, imports would have been lower than exports, but here imports are higher.”
Sainju, who was also one of the consultants involved in preparing NTIS 2023, said none of the works outlined in the strategy to boost exports have been effectively implemented by the ministries, departments or stakeholders concerned.
He said Nepal has not been able to export large cardamom directly to third countries due to the lack of processing units, reflecting the weak efforts to strengthen trade. With the current global trade war and rising tariffs creating new challenges, Nepal has also failed to realign its trade strategy to respond to changing global conditions, he added.
https://kathmandupost.com/money/2026/01/26/high-value-exports-falter-as-nepal-s-export-growth-rides-on-re-exported-edible-oil
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Brazilian soybean harvest set to hit another record high
South America is further consolidating its share of the global soybean market in this crop year.
Brazil is expected to record another bumper crop, whereas the Argentine crop is projected to fall short of the previous year's output.
Brazil, the US and Argentina are the world's main producers of soybeans, collectively accounting for 80% of global production. China follows a long way behind with a market share of 5%.
According to a USDA estimate, Brazil is expected to harvest an all-time record of 178 million tonnes of soybeans in the current crop year, which compares around 171.5 million tonnes in the previous year.
Based on a 1.7 million hectares expansion of soybean area to 49.1 million hectares, Brazil is consolidating its position as the world's number one soybean producer ahead of the US.
In the US, the soybean harvest was already complete by the end of 2025, totalling around 116.0 million tonnes. This translates to a year-on-year decline of roughly 3.1 million tonnes.
Argentina, which ranks third among the world's most important producers, is also projected to record a slightly smaller harvest than in the previous year. According to Agrarmarkt Informations-Gesellschaft, the country is expected to harvest 48.5 million tonnes, a decrease of around 2.6 million tonnes compared with the previous year.
In contrast, the latest USDA estimates indicate that China's harvest will rise around 0.3 million tonnes from the previous year, reaching 20.9 million tonnes.
The Union zur Förderung von Oel- und Proteinpflanzen (UFOP) has voiced concerns about the continued expansion of cropland for soybean cultivation in Brazil, adding that even at this stage, it is clear that the European Regulation on deforestation-free products (EUDR) is ineffective, even though it has not yet formally entered into force. Biofuels News
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T&E: EU to phase out soy biofuels
According to Transport & Environment (T&E), soy biofuels will no longer count towards EU renewable energy targets, following new research from the European Commission showing they contribute significantly to deforestation.
The EU plans to phase out soy biofuels to curb the use of crops linked to indirect land-use change (ILUC), a major driver of CO₂ emissions and biodiversity loss. The Commission’s report highlights the deforestation risks associated with promoting food and feed crops for fuel, a concern that grows as global biofuel consumption continues to rise, T&E notes. Safety4sea
Europe’s trade pivot to Asia could deliver major gains for Malaysia, analysts say
Malaysia stands to reap significant economic benefits if Europe accelerates efforts to diversify its trade links towards Asia
MALAYSIA could emerge as a key beneficiary of Europe’s potential move to diversify its trade and supply chains towards Asia, particularly as demand for electronics, semiconductors, palm oil and other core commodities strengthens, analysts said.
TA Securities said Malaysia’s electrical and electronics sector is strategically positioned to capture an export upswing as global supply chains increasingly shift away from overreliance on the United States.
The firm noted that this realignment presents fresh opportunities for Malaysian manufacturers, especially amid growing uncertainties in trans-Atlantic trade relations.
However, it cautioned that challenges remain, particularly in securing access to high-technology components that are subject to US patents and export restrictions, which could limit the pace of expansion in advanced manufacturing.
In the palm oil sector, TA Securities said market opportunities in Europe remain open, but environmental and sustainability concerns continue to pose significant barriers.
The firm stressed that Malaysia must further strengthen green certification standards and sustainable practices to ensure continued access to European markets.
“If Europe diversifies its trade relations with Asia, Malaysia could benefit from stronger demand for electronics, palm oil and commodities,” it said in a research note.
Global trade sentiment has turned volatile following renewed tariff threats by US President Donald Trump after his return from the World Economic Forum in Davos.
Trump warned of imposing tariffs of up to 100 per cent on Canada should Prime Minister Mark Carney proceed with trade agreements involving China, a move widely seen as a direct response to Carney’s remarks at the summit.
Such threats are unlikely to be taken lightly by Canada, given the United States’ heavy reliance on Canadian energy supplies.
Analysts said Trump’s stance has not only unsettled markets but has also strained trans-Atlantic relations, increasing the likelihood of heightened geopolitical tensions in the near term.
The widening rift between Europe and the United States is expected to deepen scepticism towards US leadership, potentially shaping Europe’s strategic choices in the years ahead.
European leaders are now anticipated to accelerate efforts to reduce dependence on Washington economically, militarily and diplomatically, while expanding engagement with other global powers.
China and India are expected to emerge as key partners in Europe’s diversification agenda, while direct negotiations with Russia on critical issues may become more frequent, potentially sidelining US mediation altogether.
This geopolitical realignment could trigger ripple effects across financial markets. Analysts said Europe’s growing scepticism towards the US may translate into reduced holdings of US assets, weakening confidence in the dollar.
At the same time, commodities such as gold and silver are expected to gain renewed appeal as safe-haven assets amid heightened uncertainty.
Against this backdrop, TA Securities said Malaysia’s economic performance in 2025 demonstrated strong resilience despite global uncertainty driven by reciprocal tariffs and geopolitical strains.
The country’s total trade surpassed RM3 trillion for the first time, recording a trade surplus of RM151.8 billion.
The robust performance also lent support to the ringgit, underpinned by stronger-than-expected fourth-quarter 2025 gross domestic product growth of 5.7 per cent year-on-year, solid inflows from foreign tourist spending and expectations of a more accommodative US monetary policy stance.
The research firm noted that the ringgit briefly strengthened past the RM4.00 level against the US dollar last Friday and could gain further ground if the US Federal Reserve maintains a dovish narrative at its policy meeting this week, even as the US federal funds rate is expected to remain unchanged within the 3.50 to 3.75 per cent range. - January 26, 2026 The Vibes
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Indonesia's Plan for Palm Oil Self-Sufficiency under Prabowo
TEMPO.CO, Jakarta - After seeing digital documents shown by Tempo, Albertus Tenggare and Ambrosius Tenggare immediately recalled the increasingly frequent roar they had heard in recent months from the skies above Boven Digoel Regency, South Papua. "No wonder helicopters keep flying overhead," Albertus said.
That Friday afternoon, November 28, 2025, Albertus and Ambrosius went to check on Wataron, their clan's customary forest, located on the western side of the Trans-Papua highway linking Boven Digoel and Merauke. The Tenggare clan, led by Albertus, has held a participatory map of its 3,000-hectare ancestral land for the past three years, which came out about the same time as the issuance of Boven Digoel Regional Regulation No. 2/2023 on the Recognition and Protection of Indigenous Communities Rights. The Tenggare are part of the Wambon Kenemopte sub-tribe, commonly known as Mandobo.
The document shown to Tempo was a digital map referring to Forestry Minister Decree No. 591/2025. The decree signed by Minister Raja Juli Antoni reclassified 486,940 hectares of forest in the regencies of Merauke, Mappi, and Boven Digoel. According to a copy of the decree, the change was made "to support the acceleration of development in national food, energy, and water self-sufficiency zones." Forest areas overlapping with Wataron were among those redesignated as "other use zones" (APL).
Albertus' wooden house stands on the eastern edge of Wataron, beside the Trans-Papua Highway connecting Boven Digoel and Merauke. Ambrosius' hut sits directly across the road. There, they have cleared a plot roughly the size of two volleyball courts to plant chilies and fruit trees. "Just up to here, no further," Albertus said, pointing to the boundary between their fields and the forest.
Read the Complete Story in Tempo English Magazine
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High-value exports falter as Nepal’s export growth rides on re-exported edible oil
Exports of NTIS-listed products barely grow in the first half, while shipments of imported edible oil to India surge, exposing weak value addition and poor implementation of the export strategy.
Nepal’s export of high-value goods continues to struggle, with growth stalling at a meagre 1.22 percent in the first half of the current fiscal year, sharply contrasting with overall export growth of 43.76 percent during the period.
Government data show that the surge in exports has largely been fuelled by edible oil—goods Nepal does not produce domestically. According to the Department of Customs, Nepal exported goods worth Rs142.01 billion in the first six months of the current fiscal year until mid-January.
However, exports of products listed under the Nepal Trade Integrated Strategy (NTIS) 2023 reached only Rs49.64 billion during the review period, marginally up from Rs49.04 billion in the same period of the previous fiscal year.
During the period, exports of edible oil—soybean, sunflower and palm oil—jumped sharply by 155.69 percent to Rs64 billion. Nepali traders import crude edible oil and re-export it to India after processing, taking advantage of tariff concessions under the South Asian Free Trade Area (SAFTA) regime. Nepal exported 311,841 tonnes of edible oil to India during the review period.
The government implemented the revised NTIS 2023, replacing NTIS 2016, to boost exports and support Nepal’s graduation from the least developed country category by 2026. However, more than two years into its implementation, the export performance of identified potential commodities has continued to weaken.
Nepal imported 459,238 tonnes of crude soybean, sunflower and palm oil worth Rs71.22 billion in the first six months of the current fiscal year.
“The import and export data of edible oil show that Nepal has not added value and is merely re-exporting,” said Rabi Shankar Sainju, a trade expert. “If Nepal had added value, imports would have been lower than exports, but here imports are higher.”
Sainju, who was also one of the consultants involved in preparing NTIS 2023, said none of the works outlined in the strategy to boost exports have been effectively implemented by the ministries, departments or stakeholders concerned.
He said Nepal has not been able to export large cardamom directly to third countries due to the lack of processing units, reflecting the weak efforts to strengthen trade. With the current global trade war and rising tariffs creating new challenges, Nepal has also failed to realign its trade strategy to respond to changing global conditions, he added.
https://kathmandupost.com/money/2026/01/26/high-value-exports-falter-as-nepal-s-export-growth-rides-on-re-exported-edible-oil
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Brazilian soybean harvest set to hit another record high
South America is further consolidating its share of the global soybean market in this crop year.
Brazil is expected to record another bumper crop, whereas the Argentine crop is projected to fall short of the previous year's output.
Brazil, the US and Argentina are the world's main producers of soybeans, collectively accounting for 80% of global production. China follows a long way behind with a market share of 5%.
According to a USDA estimate, Brazil is expected to harvest an all-time record of 178 million tonnes of soybeans in the current crop year, which compares around 171.5 million tonnes in the previous year.
Based on a 1.7 million hectares expansion of soybean area to 49.1 million hectares, Brazil is consolidating its position as the world's number one soybean producer ahead of the US.
In the US, the soybean harvest was already complete by the end of 2025, totalling around 116.0 million tonnes. This translates to a year-on-year decline of roughly 3.1 million tonnes.
Argentina, which ranks third among the world's most important producers, is also projected to record a slightly smaller harvest than in the previous year. According to Agrarmarkt Informations-Gesellschaft, the country is expected to harvest 48.5 million tonnes, a decrease of around 2.6 million tonnes compared with the previous year.
In contrast, the latest USDA estimates indicate that China's harvest will rise around 0.3 million tonnes from the previous year, reaching 20.9 million tonnes.
The Union zur Förderung von Oel- und Proteinpflanzen (UFOP) has voiced concerns about the continued expansion of cropland for soybean cultivation in Brazil, adding that even at this stage, it is clear that the European Regulation on deforestation-free products (EUDR) is ineffective, even though it has not yet formally entered into force. Biofuels News
--------
T&E: EU to phase out soy biofuels
According to Transport & Environment (T&E), soy biofuels will no longer count towards EU renewable energy targets, following new research from the European Commission showing they contribute significantly to deforestation.
The EU plans to phase out soy biofuels to curb the use of crops linked to indirect land-use change (ILUC), a major driver of CO₂ emissions and biodiversity loss. The Commission’s report highlights the deforestation risks associated with promoting food and feed crops for fuel, a concern that grows as global biofuel consumption continues to rise, T&E notes. Safety4sea
January 24, 2026
Palm Oil Industry Seen as Backbone of Indonesia’s Geopolitical Economy
RRI.CO.ID, Jakarta - Industry leaders and academics are urging the government to formally recognize Indonesia’s palm oil sector as a “National Strategic Commodity.”
Speaking at a national seminar in Yogyakarta on Friday, January 23, 2026, experts stressed that palm oil is no longer merely an agricultural product but a vital instrument for national sovereignty, food security, and the global energy transition.
Eddy Martono, Chairman of the Indonesian Palm Oil Association (Gapki), emphasized that the industry provides livelihoods for around 16.5 million households, ranging from smallholder farmers to corporate employees. “We also hope this industry will be part of the solution to food and energy security, regional development, and improved environmental sustainability,” Martono said, as quoted by Antara.
The sector’s macroeconomic contribution is substantial. In 2022, palm oil exports generated USD 39 billion in foreign exchange, helping secure Indonesia’s US$56 billion trade surplus.
By 2025, Indonesia remained the world’s largest producer, managing 17.1 million hectares of plantations and producing 49.4 million tons of crude palm oil (CPO).
To sustain this dominance amid tightening global regulations and environmental scrutiny, experts are calling for a dual-track strategy that prioritizes long-term sustainability and added value.
A key component is hilirisasi (downstreaming), which shifts the industry beyond raw exports toward functional food production with specific health benefits and high-value manufacturing.
The strategy also highlights palm oil’s role in the energy transition, positioning it as a primary feedstock for new and renewable energy solutions. In addition, Indonesia seeks to leverage its 48 percent share of the global market as a geopolitical tool to influence international trade policy and safeguard national economic interests.
Professor Zulkarnain of Mulawarman University noted that palm oil’s superior productivity compared to other vegetable oils has made it a target of international policy disputes.
“Palm oil has transformed from a mere agricultural commodity into a national strategic issue,” he said, adding that its role in regional development and soil fertility management justifies explicit protection under national law. RRI
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DAVOS: US-Indonesian trade deal could boost trade four-fold, Kadin chair says
*Trade deal could massively increase bilateral trade, business leader says
*Could also support inward investment
*Deal could be signed next month, government official says
By John Revill and Stefanno Sulaiman
DAVOS, Switzerland/JAKARTA, Jan 23 (Reuters) - A trade agreement being discussed between the United States and Indonesia could lead to a massive expansion in bilateral trade between the two countries, the head of Indonesia's chamber of commerce told Reuters. The agreement, which could be completed next month, could increase trade between the U.S and southeast Asia's largest economy four-fold from the current level of around $40 billion per year, Anindya Bakrie, Chairman of Kadin, said in an interview at the World Economic Forum in Davos, Switzerland.
"Trade would become more balanced but the total trade would expand maybe three or four times," Bakrie said. Bakrie, whose organisation represents all businesses in Indonesia, said the country had long run a trade surplus with the United States, which was currently running at around $2 billion per month.
"I believe the U.S. would like to balance that. We don't mind because balancing means they want to send more wheat, cotton, oil, and gas and dairy," he said.
"But we can also increase our own exports because we get much more free access for our palm oil, garments, electronics, furniture."
Last year, the U.S. threatened an additional tariff of 32% on Indonesian exports, but the new deal would lower this to 19%, when it goes into effect.
In 2024, exports from Indonesia to the U.S. reached $26.54 billion with major shipments of palm oil, footwear, and electrical machines, according to data from Indonesia's trade ministry.
Meanwhile the U.S. exported $12 billion of products to Indonesia in 2024, a level that has not changed much since 2021, with soybean, wheat, cotton and petroleum oils among the main products.
Kadin's Bakrie said the deal could also lead to more investment into Indonesia from the United States.
"Indonesia's investment in the U.S. will also increase. There could be more investments in both directions."
Indonesia has yet to sign the final deal with the U.S. but both might sign next month depending on each leader's schedule as final discussions between respective delegates have been held, said Susiwijono Moegiarso, a senior official at Indonesia's economic ministry.
"Final discussions have been held and all substantive matters are now complete," he told Reuters on Friday without giving more details. (Reporting by John Revill; Editing by Aidan Lewis and Chizu Nomiyama ) Fidelity
Palm Oil Industry Seen as Backbone of Indonesia’s Geopolitical Economy
RRI.CO.ID, Jakarta - Industry leaders and academics are urging the government to formally recognize Indonesia’s palm oil sector as a “National Strategic Commodity.”
Speaking at a national seminar in Yogyakarta on Friday, January 23, 2026, experts stressed that palm oil is no longer merely an agricultural product but a vital instrument for national sovereignty, food security, and the global energy transition.
Eddy Martono, Chairman of the Indonesian Palm Oil Association (Gapki), emphasized that the industry provides livelihoods for around 16.5 million households, ranging from smallholder farmers to corporate employees. “We also hope this industry will be part of the solution to food and energy security, regional development, and improved environmental sustainability,” Martono said, as quoted by Antara.
The sector’s macroeconomic contribution is substantial. In 2022, palm oil exports generated USD 39 billion in foreign exchange, helping secure Indonesia’s US$56 billion trade surplus.
By 2025, Indonesia remained the world’s largest producer, managing 17.1 million hectares of plantations and producing 49.4 million tons of crude palm oil (CPO).
To sustain this dominance amid tightening global regulations and environmental scrutiny, experts are calling for a dual-track strategy that prioritizes long-term sustainability and added value.
A key component is hilirisasi (downstreaming), which shifts the industry beyond raw exports toward functional food production with specific health benefits and high-value manufacturing.
The strategy also highlights palm oil’s role in the energy transition, positioning it as a primary feedstock for new and renewable energy solutions. In addition, Indonesia seeks to leverage its 48 percent share of the global market as a geopolitical tool to influence international trade policy and safeguard national economic interests.
Professor Zulkarnain of Mulawarman University noted that palm oil’s superior productivity compared to other vegetable oils has made it a target of international policy disputes.
“Palm oil has transformed from a mere agricultural commodity into a national strategic issue,” he said, adding that its role in regional development and soil fertility management justifies explicit protection under national law. RRI
--------
DAVOS: US-Indonesian trade deal could boost trade four-fold, Kadin chair says
*Trade deal could massively increase bilateral trade, business leader says
*Could also support inward investment
*Deal could be signed next month, government official says
By John Revill and Stefanno Sulaiman
DAVOS, Switzerland/JAKARTA, Jan 23 (Reuters) - A trade agreement being discussed between the United States and Indonesia could lead to a massive expansion in bilateral trade between the two countries, the head of Indonesia's chamber of commerce told Reuters. The agreement, which could be completed next month, could increase trade between the U.S and southeast Asia's largest economy four-fold from the current level of around $40 billion per year, Anindya Bakrie, Chairman of Kadin, said in an interview at the World Economic Forum in Davos, Switzerland.
"Trade would become more balanced but the total trade would expand maybe three or four times," Bakrie said. Bakrie, whose organisation represents all businesses in Indonesia, said the country had long run a trade surplus with the United States, which was currently running at around $2 billion per month.
"I believe the U.S. would like to balance that. We don't mind because balancing means they want to send more wheat, cotton, oil, and gas and dairy," he said.
"But we can also increase our own exports because we get much more free access for our palm oil, garments, electronics, furniture."
Last year, the U.S. threatened an additional tariff of 32% on Indonesian exports, but the new deal would lower this to 19%, when it goes into effect.
In 2024, exports from Indonesia to the U.S. reached $26.54 billion with major shipments of palm oil, footwear, and electrical machines, according to data from Indonesia's trade ministry.
Meanwhile the U.S. exported $12 billion of products to Indonesia in 2024, a level that has not changed much since 2021, with soybean, wheat, cotton and petroleum oils among the main products.
Kadin's Bakrie said the deal could also lead to more investment into Indonesia from the United States.
"Indonesia's investment in the U.S. will also increase. There could be more investments in both directions."
Indonesia has yet to sign the final deal with the U.S. but both might sign next month depending on each leader's schedule as final discussions between respective delegates have been held, said Susiwijono Moegiarso, a senior official at Indonesia's economic ministry.
"Final discussions have been held and all substantive matters are now complete," he told Reuters on Friday without giving more details. (Reporting by John Revill; Editing by Aidan Lewis and Chizu Nomiyama ) Fidelity
January 23, 2026
Palm oil closes at two month high on US biofuel regulations
KUALA LUMPUR: Malaysian palm oil futures closed at its highest level in two months on Thursday, as the likelihood of a production decline amid firm demand, and expectations that the U.S. will soon increase its biofuel blending levels supported the market.
The benchmark palm oil contract for April delivery on Bursa Malaysia Derivatives Exchange gained 44 ringgit, or 1.06%, to 4,198 ringgit ($1,039.62) a metric ton, the highest close since November 19, 2025.
The market traded higher on news that the U.S. will soon release its final regulations around biofuels, which means that biomass diesel feedstock demand will rise, and that January could see double-digit losses in palm production, said Paramalingam Supramaniam, director at Selangor-based brokerage Pelindung Bestari. Business Recorder
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Waste, Palm Oil, and the Road to Energy Independence for Indonesia
Indonesia's energy transition is a long journey that demands collective effort. By positioning used cooking oil as a strategic complement to crude palm oil, we can strengthen national energy security ahead of the B50 era while delivering environmental benefits that reach grassroots communities. Let our kitchens become the starting point of Indonesia's energy sovereignty.
INDONESIA is steadily advancing toward energy independence. The government's commitment to reducing fossil fuel imports deserves recognition, particularly through the mandatory biodiesel program that has progressed from B35 to B40 in 2025, with B50 expected to be enacted in 2026. This policy firmly places palm oil at the heart of the national energy strategy.
Yet every major policy brings its own challenges. Meeting the B50 target in 2026 is projected to require an additional 3–5 million tons of crude palm oil (CPO) beyond current demand. At the same time, the Indonesian Palm Oil Association (GAPKI) projects national palm oil production to stagnate at around 53 million tons in 2025, while domestic consumption for food and energy continues to rise. This imbalance forces Indonesia to seek creative solutions—ones that do not jeopardize food security or drive excessive land expansion with serious environmental risks.
An Untapped Partner from Household Kitchens
Amid the recurring “food versus energy” debate, one strategic partner remains underutilized: used cooking oil (UCO), commonly known as used cooking oil. Chemically, UCO can be converted—when properly processed—into biodiesel comparable in quality to that produced from fresh CPO. Rather than competing with palm oil, used cooking oil acts as a buffer, easing pressure on CPO supplies and allowing the palm oil industry to maintain stability in food markets and strategic exports.
Studies by the International Council on Clean Transportation (ICCT) suggest that Indonesia's potential UCO supply is substantial, yet only a small fraction is currently collected. Local observations in South Jakarta in 2022 revealed that around 80 percent of households still dispose of cooking used oil into drains, largely due to lack of information, inconvenience, or uncertainty about collection points. This practice clogs waterways, increases the organic load in wastewater systems, and risks contaminating soil and groundwater.
The government has begun to recognize this opportunity. Trade Regulation No. 2 of 2025 restricts the export of used cooking oil, ensuring that domestic supplies are retained—even though export prices can be almost double local collection prices. However, without a comprehensive system for collection and stock management, the regulation's impact remains limited.
Appropriate Technology Matters KBA News
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Malaysia to introduce UCO reference price in first quarter 2026
The Malaysian Palm Oil Board (MPOB) will introduce an official used cooking oil (UCO) reference price in the first quarter of 2026, according to an Eco-Business report.
MPOB – the statutory body which oversees the regulation, research and development of the country’s palm oil industry – said the move was aimed at improving market transparency, guiding fair trading and strengthening the development of a circular palm oil economy.
The benchmark was expected to provide clearer price signals while protecting smaller market participants from price manipulation and misinformation, Malaysia’s Plantation and Commodities minister Noraini Ahmad was quoted as saying in the 20 January report.
“The initiative supports Malaysia’s push towards a circular economy, where waste and by-products are converted into valuable industrial and energy resources,” Ahmad was reported as saying in a 13 January New Straits Times article.
MPOB director general Dr Ahmad Parveez Ghulam Kadir added that the reference price was based on the local delivered price, reflecting UCO sold within Malaysia and including local transport costs, rather than export-based free on board (FOB) pricing.
“It (the reference price) is to make it more transparent, so that people have a reference whenever they would like to sell whatever UCO they have collected. This will help ensure that they get a good price and that the market is more regulated,” Kadir was quoted as saying in a 13 January report by The Edge Malaysia. OFI Magazine
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Indonesian palm oil union KBS calls for legislation for palm oil workers
During the 3rd international IPOWU conference, which took place from 8 to 13 September 2025, the Palm Oil Workers Coalition (KBS) called for special legislation to protect palm oil workers. The theme of the IPOWU conference was 'Decent work on palm oil plantations'.
KBS was one of the organizers of the event. KBS coordinator Ismet Inoni highlighted various labor issues faced by palm oil plantation workers, including wage inequality, the dangers of pesticides and gender issues. The union has compiled an inventory of these problems and found that Indonesian labor law does not sufficiently cover palm oil workers. "These laws do not address many issues on palm oil plantations," said Ismet, "so one of the programs of the Palm Oil Labor Coalition is to draft a law on the protection of workers on palm oil plantations in Indonesia."
Draft law written
In 2022, KBS drafted an initial bill on the protection of workers on palm oil plantations (RUPBS), which was then submitted to the Ministry of Labor. It consists of 59 articles and regulates various aspects of work in the palm oil industry, including labor relations, recruitment systems, wages, safety, health and well-being at work, the right to organize, the protection of female workers and the prevention and handling of sexual violence. RUPBS also includes administrative and criminal penalties for companies that violate the various provisions. The trade union has written a supplement to this. Labor Minister Yassierli, who attended the IPOWU conference, said: "The coalition of palm oil workers is committed to decent work in the palm oil plantation sector. We are awaiting their recommendations."
High quotas
This call is all the more urgent considering there were 93,000 labor rights violations and 462,000 occupational accidents in Indonesia in 2024. In an interview on the draft bill, Ismet stated that one of the said labor rights violations was the lack of job security. “Employees work on a contract basis, as temporary day laborers (BHL) or as piece-rate day laborers (BHB). Some workers are not paid and therefore have no social security – in this case a woman or child,” said Ismet at the KBS office in the Pasar Minggu district. He argued that workers involve their wives and children in their work because otherwise they would not be able to meet the high quotas.
Below the minimum wage
Although several regions in West and South Kalimantan have set a district minimum wage (UMSK) for the palm oil sector, the wages of many workers are still below the UMSK. “They work on the basis of their presence and usually less than 20 days a month. Some even only work three days a month, which means they only earn around 300,000 or 400,000 rupiah,” said Ismet. Social security is also often non-existent.
New research into pesticides
Research conducted last year by KBS in collaboration with IPOWU shows that palm oil plantations in Indonesia still use 39 types of pesticides. Dangerous pesticides such as paraquat, which is banned from sale in the European Union, are still widely used in the spraying of palm oil plantations. The consequences of this are serious, especially for the workers who spray them, but also for their colleagues who work on the plantations.
Following up on this study, KBS conducted further research in Central Kalimantan, particularly in the town of East Waringin, and in North Sumatra, particularly in the regency of Mandailing Natal. KBS interviewed approximately 30 workers in the two provinces and found that they suffered from conditions such as shortness of breath, skin irritation, itching and, in the most serious case, a woman with breast cancer. Although the link between the use of agrochemicals and these various diseases has not yet been confirmed, Ismet is pushing for medical studies. FNV
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Palm oil closes at two month high on US biofuel regulations
KUALA LUMPUR: Malaysian palm oil futures closed at its highest level in two months on Thursday, as the likelihood of a production decline amid firm demand, and expectations that the U.S. will soon increase its biofuel blending levels supported the market.
The benchmark palm oil contract for April delivery on Bursa Malaysia Derivatives Exchange gained 44 ringgit, or 1.06%, to 4,198 ringgit ($1,039.62) a metric ton, the highest close since November 19, 2025.
The market traded higher on news that the U.S. will soon release its final regulations around biofuels, which means that biomass diesel feedstock demand will rise, and that January could see double-digit losses in palm production, said Paramalingam Supramaniam, director at Selangor-based brokerage Pelindung Bestari. Business Recorder
--------
Waste, Palm Oil, and the Road to Energy Independence for Indonesia
Indonesia's energy transition is a long journey that demands collective effort. By positioning used cooking oil as a strategic complement to crude palm oil, we can strengthen national energy security ahead of the B50 era while delivering environmental benefits that reach grassroots communities. Let our kitchens become the starting point of Indonesia's energy sovereignty.
INDONESIA is steadily advancing toward energy independence. The government's commitment to reducing fossil fuel imports deserves recognition, particularly through the mandatory biodiesel program that has progressed from B35 to B40 in 2025, with B50 expected to be enacted in 2026. This policy firmly places palm oil at the heart of the national energy strategy.
Yet every major policy brings its own challenges. Meeting the B50 target in 2026 is projected to require an additional 3–5 million tons of crude palm oil (CPO) beyond current demand. At the same time, the Indonesian Palm Oil Association (GAPKI) projects national palm oil production to stagnate at around 53 million tons in 2025, while domestic consumption for food and energy continues to rise. This imbalance forces Indonesia to seek creative solutions—ones that do not jeopardize food security or drive excessive land expansion with serious environmental risks.
An Untapped Partner from Household Kitchens
Amid the recurring “food versus energy” debate, one strategic partner remains underutilized: used cooking oil (UCO), commonly known as used cooking oil. Chemically, UCO can be converted—when properly processed—into biodiesel comparable in quality to that produced from fresh CPO. Rather than competing with palm oil, used cooking oil acts as a buffer, easing pressure on CPO supplies and allowing the palm oil industry to maintain stability in food markets and strategic exports.
Studies by the International Council on Clean Transportation (ICCT) suggest that Indonesia's potential UCO supply is substantial, yet only a small fraction is currently collected. Local observations in South Jakarta in 2022 revealed that around 80 percent of households still dispose of cooking used oil into drains, largely due to lack of information, inconvenience, or uncertainty about collection points. This practice clogs waterways, increases the organic load in wastewater systems, and risks contaminating soil and groundwater.
The government has begun to recognize this opportunity. Trade Regulation No. 2 of 2025 restricts the export of used cooking oil, ensuring that domestic supplies are retained—even though export prices can be almost double local collection prices. However, without a comprehensive system for collection and stock management, the regulation's impact remains limited.
Appropriate Technology Matters KBA News
--------
Malaysia to introduce UCO reference price in first quarter 2026
The Malaysian Palm Oil Board (MPOB) will introduce an official used cooking oil (UCO) reference price in the first quarter of 2026, according to an Eco-Business report.
MPOB – the statutory body which oversees the regulation, research and development of the country’s palm oil industry – said the move was aimed at improving market transparency, guiding fair trading and strengthening the development of a circular palm oil economy.
The benchmark was expected to provide clearer price signals while protecting smaller market participants from price manipulation and misinformation, Malaysia’s Plantation and Commodities minister Noraini Ahmad was quoted as saying in the 20 January report.
“The initiative supports Malaysia’s push towards a circular economy, where waste and by-products are converted into valuable industrial and energy resources,” Ahmad was reported as saying in a 13 January New Straits Times article.
MPOB director general Dr Ahmad Parveez Ghulam Kadir added that the reference price was based on the local delivered price, reflecting UCO sold within Malaysia and including local transport costs, rather than export-based free on board (FOB) pricing.
“It (the reference price) is to make it more transparent, so that people have a reference whenever they would like to sell whatever UCO they have collected. This will help ensure that they get a good price and that the market is more regulated,” Kadir was quoted as saying in a 13 January report by The Edge Malaysia. OFI Magazine
--------
Indonesian palm oil union KBS calls for legislation for palm oil workers
During the 3rd international IPOWU conference, which took place from 8 to 13 September 2025, the Palm Oil Workers Coalition (KBS) called for special legislation to protect palm oil workers. The theme of the IPOWU conference was 'Decent work on palm oil plantations'.
KBS was one of the organizers of the event. KBS coordinator Ismet Inoni highlighted various labor issues faced by palm oil plantation workers, including wage inequality, the dangers of pesticides and gender issues. The union has compiled an inventory of these problems and found that Indonesian labor law does not sufficiently cover palm oil workers. "These laws do not address many issues on palm oil plantations," said Ismet, "so one of the programs of the Palm Oil Labor Coalition is to draft a law on the protection of workers on palm oil plantations in Indonesia."
Draft law written
In 2022, KBS drafted an initial bill on the protection of workers on palm oil plantations (RUPBS), which was then submitted to the Ministry of Labor. It consists of 59 articles and regulates various aspects of work in the palm oil industry, including labor relations, recruitment systems, wages, safety, health and well-being at work, the right to organize, the protection of female workers and the prevention and handling of sexual violence. RUPBS also includes administrative and criminal penalties for companies that violate the various provisions. The trade union has written a supplement to this. Labor Minister Yassierli, who attended the IPOWU conference, said: "The coalition of palm oil workers is committed to decent work in the palm oil plantation sector. We are awaiting their recommendations."
High quotas
This call is all the more urgent considering there were 93,000 labor rights violations and 462,000 occupational accidents in Indonesia in 2024. In an interview on the draft bill, Ismet stated that one of the said labor rights violations was the lack of job security. “Employees work on a contract basis, as temporary day laborers (BHL) or as piece-rate day laborers (BHB). Some workers are not paid and therefore have no social security – in this case a woman or child,” said Ismet at the KBS office in the Pasar Minggu district. He argued that workers involve their wives and children in their work because otherwise they would not be able to meet the high quotas.
Below the minimum wage
Although several regions in West and South Kalimantan have set a district minimum wage (UMSK) for the palm oil sector, the wages of many workers are still below the UMSK. “They work on the basis of their presence and usually less than 20 days a month. Some even only work three days a month, which means they only earn around 300,000 or 400,000 rupiah,” said Ismet. Social security is also often non-existent.
New research into pesticides
Research conducted last year by KBS in collaboration with IPOWU shows that palm oil plantations in Indonesia still use 39 types of pesticides. Dangerous pesticides such as paraquat, which is banned from sale in the European Union, are still widely used in the spraying of palm oil plantations. The consequences of this are serious, especially for the workers who spray them, but also for their colleagues who work on the plantations.
Following up on this study, KBS conducted further research in Central Kalimantan, particularly in the town of East Waringin, and in North Sumatra, particularly in the regency of Mandailing Natal. KBS interviewed approximately 30 workers in the two provinces and found that they suffered from conditions such as shortness of breath, skin irritation, itching and, in the most serious case, a woman with breast cancer. Although the link between the use of agrochemicals and these various diseases has not yet been confirmed, Ismet is pushing for medical studies. FNV
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January 22, 2026
Indonesia seizes 85,000 hectares of sugarcane land, raising palm oil supply concerns
Indonesia has taken over about 85,000 hectares of land used for sugarcane farming and processing from Sugar Group Companies (SGC), one of the country’s largest private sugar producers, after authorities said the land legally belongs to the government, reported Reuters.
The move has raised concern in the country and pushed up global palm oil prices as Indonesia is world’s biggest producer of palm oil.
The takeover is part of a wider government drive to reclaim plantations and mining areas that are considered to be operating illegally.
Minister of Agrarian Affairs and Spatial Planning Nusron Wahid said all permits covering the land had been cancelled. He said the area, which includes sugarcane fields and a sugar factory, would be returned to its rightful owner, the Defence Ministry, and placed under the control of the Indonesian Air Force.
SGC did not immediately respond to a request for comment, stated news agency Reuters.
The land is located in Lampung province on the island of Sumatra. Nusron said reviews carried out by the Supreme Audit Agency in 2015, 2019 and 2022 found that the land was owned by the Defence Ministry, specifically the Air Force.
He explained that while the company had been granted government-issued rights to use the land, those rights did not change the fact that ownership remained with the state. The Air Force operates under the Defence Ministry.
The minister did not clarify why the government chose to reclaim the land at this time, despite the most recent audit having been completed four years ago.
According to Nusron, the Air Force plans to convert the seized land into a training facility for military personnel.
Since it was established early last year, the military-backed forestry task force has taken control of about 8,800 hectares of land previously used for mining activities such as nickel, coal, quartz sand and limestone. It has also seized palm oil plantations covering around 4.1 million hectares, an area roughly the size of the Netherlands. Chini Mandi
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Carson Group updates on Indonesian Govt.’s move to nationalise palm oil plantations
Carson Cumberbatch PLC and Bukit Darah PLC have issued their latest response to the Indonesian Government’s plans to nationalise its palm oil plantation.
The update is a follow up to the Announcement dated 28 October 2025 on the ‘Implementation of new laws in Indonesia for Palm Oil Plantations’ which, according to publicly available information, has currently affected approx. 4.1 million hectares of palm oil plantations across Indonesia.
In a filing to the Colombo Stock Exchange, the two companies said based on information received from their subsidiary, Goodhope Asia Holdings Ltd. (Goodhope). Goodhope has continued its engagement with the Presidential Task Force established by the Government of Indonesia and has attended meetings and provided information as requested. The Task Force has intimated to Goodhope a provisional administrative fine of approximately IDR 1,826 billion (equivalent to approximately $ 108.4 million) which has been communicated as a temporary notification and subject to future adjustment and finalisation following further review by the Task Force.
Goodhope has sought detailed clarification from the authorities regarding the basis and methodology underlying this provisional computation and is actively discussing the matter. It has adequate liquidity to manage the impact, if imposed.
The company further reiterates its continuing commitment to full compliance with applicable Indonesian laws and regulations and remains engaged in constructive dialogue with the relevant authorities to ensure regulatory adherence and operational continuity, and to safeguard the interests of all stakeholders. FTLK
Indonesia seizes 85,000 hectares of sugarcane land, raising palm oil supply concerns
Indonesia has taken over about 85,000 hectares of land used for sugarcane farming and processing from Sugar Group Companies (SGC), one of the country’s largest private sugar producers, after authorities said the land legally belongs to the government, reported Reuters.
The move has raised concern in the country and pushed up global palm oil prices as Indonesia is world’s biggest producer of palm oil.
The takeover is part of a wider government drive to reclaim plantations and mining areas that are considered to be operating illegally.
Minister of Agrarian Affairs and Spatial Planning Nusron Wahid said all permits covering the land had been cancelled. He said the area, which includes sugarcane fields and a sugar factory, would be returned to its rightful owner, the Defence Ministry, and placed under the control of the Indonesian Air Force.
SGC did not immediately respond to a request for comment, stated news agency Reuters.
The land is located in Lampung province on the island of Sumatra. Nusron said reviews carried out by the Supreme Audit Agency in 2015, 2019 and 2022 found that the land was owned by the Defence Ministry, specifically the Air Force.
He explained that while the company had been granted government-issued rights to use the land, those rights did not change the fact that ownership remained with the state. The Air Force operates under the Defence Ministry.
The minister did not clarify why the government chose to reclaim the land at this time, despite the most recent audit having been completed four years ago.
According to Nusron, the Air Force plans to convert the seized land into a training facility for military personnel.
Since it was established early last year, the military-backed forestry task force has taken control of about 8,800 hectares of land previously used for mining activities such as nickel, coal, quartz sand and limestone. It has also seized palm oil plantations covering around 4.1 million hectares, an area roughly the size of the Netherlands. Chini Mandi
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Carson Group updates on Indonesian Govt.’s move to nationalise palm oil plantations
Carson Cumberbatch PLC and Bukit Darah PLC have issued their latest response to the Indonesian Government’s plans to nationalise its palm oil plantation.
The update is a follow up to the Announcement dated 28 October 2025 on the ‘Implementation of new laws in Indonesia for Palm Oil Plantations’ which, according to publicly available information, has currently affected approx. 4.1 million hectares of palm oil plantations across Indonesia.
In a filing to the Colombo Stock Exchange, the two companies said based on information received from their subsidiary, Goodhope Asia Holdings Ltd. (Goodhope). Goodhope has continued its engagement with the Presidential Task Force established by the Government of Indonesia and has attended meetings and provided information as requested. The Task Force has intimated to Goodhope a provisional administrative fine of approximately IDR 1,826 billion (equivalent to approximately $ 108.4 million) which has been communicated as a temporary notification and subject to future adjustment and finalisation following further review by the Task Force.
Goodhope has sought detailed clarification from the authorities regarding the basis and methodology underlying this provisional computation and is actively discussing the matter. It has adequate liquidity to manage the impact, if imposed.
The company further reiterates its continuing commitment to full compliance with applicable Indonesian laws and regulations and remains engaged in constructive dialogue with the relevant authorities to ensure regulatory adherence and operational continuity, and to safeguard the interests of all stakeholders. FTLK
January 21, 2026
Indonesia revokes mining and plantation permits after deadly floods
Authorities blame resources projects for exacerbating flooding and landslides that killed more than 1,000 people
Indonesia has revoked the permits of 28 resources companies, including a subsidiary of Jardine Matheson, as part of a probe into whether their operations played a role in the deadly floods that killed more than 1,000 people late last year.
President Prabowo Subianto ordered the revocation after a government task force found the companies had violated regulations, state secretary Prasetyo Hadi said late on Tuesday.
“The task force reported to the president the results of investigations into companies suspected of violating regulations. Based on that report, the president decided to revoke the permits of 28 companies found guilty of violations,” said Prasetyo.
“The government remains committed to regulating natural resource-based businesses to ensure they comply with applicable laws and regulations.”
Twenty-two of those companies are involved in operations in natural forests and plantations over an area covering about 1mn hectares, while the remaining six are involved in mining, plantations and timber.
Commodities have been a significant source of revenue and growth for resource-rich Indonesia, the world’s largest producer of palm oil and nickel, but their development has also resulted in massive deforestation and environmental damage across the archipelago. Environmental groups have long called for projects in the biodiverse island of Sumatra to be halted.
Indonesia stepped up probes of potential violations after flooding on the island killed 1,190 people in late November. Government officials blamed mining and palm oil plantations for exacerbating the flooding and landslides and promised more action.
One of the companies to have their permits revoked, Jardines-linked Agincourt Resources, operates the Martabe gold mine in Sumatra. Agincourt is a subsidiary of Indonesian conglomerate Astra International, which is controlled by Jardines.
The gold mine has proved controversial for Jardines, one of Hong Kong’s oldest colonial-era business empires.
Environmentalists say the mining operations threaten the habitat of the world’s most endangered great ape, the Tapanuli orangutan. Norway’s sovereign fund sold its stake in Jardines in 2024, citing its links to “severe environmental damage” from the mine.
The mine, located in North Sumatra province, has been closed since early December following the flooding and investigations launched by Indonesian authorities.
Agincourt said it “respects every government decision and maintains its rights in accordance with applicable regulations” without commenting further. FT
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Environmental Clampdown Rattles Indonesia Markets
Indonesian stocks fell 113 points, or 1.2%, to 9,011 in Wednesday afternoon deals, pulling back from a record high in the prior session as traders booked profits.
Market sentiment also weakened after President Prabowo revoked permits for 28 firms in forestry, palm oil, cocoa, power generation, and mining, citing environmental violations linked to last year’s floods in Sumatra.
Losses were broad-based, driven by property, financial, and infrastructure shares.
United Tractors slumped near 15% after its unit Agincourt, operator of the Martabe gold and silver mine, was among those affected.
Astra Intl. dipped 11.3%, pressured by its stake in United Tractors, while Toba Pulp Lestari eased 0.8% as it sought clarification on the crackdown.
A modest rise in U.S.
futures helped cap further declines ahead of President Trump’s address at the World Economic Forum in Davos.
Investors now await Bank Indonesia’s policy decision, with rates widely expected to stay on hold for a fourth straight month. Trading Economics
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Malaysia tailors trade diplomacy to counter palm oil discrimination
Malaysia combats palm oil discrimination with tailored trade diplomacy, diversifying markets and boosting high-value exports to new regions.
KUALA LUMPUR: The government is employing a dynamic trade diplomacy strategy to counter discrimination against Malaysian palm oil.
Plantation and Commodities Minister Datuk Seri Dr Noraini Ahmad said the ministry tailors its approach to meet the specific needs of key international markets.
She outlined a comprehensive strategy focusing on compliance, market diversification and value-added activities within the industry.
Initiatives include targeting premium oil markets and encouraging industry transformation towards high-value products.
“We are strengthening the implementation of MSPO 2.0 to ensure that palm oil meets international standards,” Noraini said in Parliament.
She was responding to a supplementary question on measures to enhance exports amid international discrimination.
The ministry, through the Malaysian Palm Oil Council, is actively diversifying markets to reduce reliance on traditional buyers.
It is strengthening its presence in high-potential regions like Sub-Saharan Africa, the Middle East, North Africa and ASEAN.
As a result, 50% of Malaysia’s total palm oil exports went to these new markets in 2025. The SunMY
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Seed oils vs butter: Here's what’s actually healthier, according to doctors
With droves of wellness warriors choosing butter over seed oils, scientists weigh in on their favourite fats
Plant oils are “the biggest villain” out of “all the bullshit foods”. Not our words, but those of major health influencer (and big fan of raw milk) Dr Paul Saladino.
Extreme? Very likely. But Saladino’s anti-seed oil stance is no longer fringe. He’s joined in that opinion by swathes of dieters and nutritionists – as well as the US health secretary Robert F Kennedy Jr.
Kennedy has called seed oils “one of the most unhealthy ingredients that we have in foods,” and has advocated for the return of butter, tallow and lard to American diets, claiming that seed oils promote inflammation in the body.
It’s a sentiment reflecting a broader shift in eating habits, says Prof Thomas Sanders, nutrition scientist at King’s College London: “In the last few years, butter has come back on the menu. People are going back to full-fat milk, going back to eating butter.”
This is particularly true in the US, where the Department of Agriculture has reported steadily increasing levels of butter consumption in recent years, reaching a record 3kg (6.8lbs) – that’s the weight of a newborn baby – per person in 2024.
And these trends are worrying health professionals. That’s because, despite all the butter hype, the evidence still suggests that plant oils are a healthier choice.
“The evidence is really consistent,” says Prof Sarah Berry, nutrition scientist at King’s College London. “Randomised controlled trials show that plant oils are better for you, and butter is worse for you.” BBC Science Focus
Indonesia revokes mining and plantation permits after deadly floods
Authorities blame resources projects for exacerbating flooding and landslides that killed more than 1,000 people
Indonesia has revoked the permits of 28 resources companies, including a subsidiary of Jardine Matheson, as part of a probe into whether their operations played a role in the deadly floods that killed more than 1,000 people late last year.
President Prabowo Subianto ordered the revocation after a government task force found the companies had violated regulations, state secretary Prasetyo Hadi said late on Tuesday.
“The task force reported to the president the results of investigations into companies suspected of violating regulations. Based on that report, the president decided to revoke the permits of 28 companies found guilty of violations,” said Prasetyo.
“The government remains committed to regulating natural resource-based businesses to ensure they comply with applicable laws and regulations.”
Twenty-two of those companies are involved in operations in natural forests and plantations over an area covering about 1mn hectares, while the remaining six are involved in mining, plantations and timber.
Commodities have been a significant source of revenue and growth for resource-rich Indonesia, the world’s largest producer of palm oil and nickel, but their development has also resulted in massive deforestation and environmental damage across the archipelago. Environmental groups have long called for projects in the biodiverse island of Sumatra to be halted.
Indonesia stepped up probes of potential violations after flooding on the island killed 1,190 people in late November. Government officials blamed mining and palm oil plantations for exacerbating the flooding and landslides and promised more action.
One of the companies to have their permits revoked, Jardines-linked Agincourt Resources, operates the Martabe gold mine in Sumatra. Agincourt is a subsidiary of Indonesian conglomerate Astra International, which is controlled by Jardines.
The gold mine has proved controversial for Jardines, one of Hong Kong’s oldest colonial-era business empires.
Environmentalists say the mining operations threaten the habitat of the world’s most endangered great ape, the Tapanuli orangutan. Norway’s sovereign fund sold its stake in Jardines in 2024, citing its links to “severe environmental damage” from the mine.
The mine, located in North Sumatra province, has been closed since early December following the flooding and investigations launched by Indonesian authorities.
Agincourt said it “respects every government decision and maintains its rights in accordance with applicable regulations” without commenting further. FT
--------
Environmental Clampdown Rattles Indonesia Markets
Indonesian stocks fell 113 points, or 1.2%, to 9,011 in Wednesday afternoon deals, pulling back from a record high in the prior session as traders booked profits.
Market sentiment also weakened after President Prabowo revoked permits for 28 firms in forestry, palm oil, cocoa, power generation, and mining, citing environmental violations linked to last year’s floods in Sumatra.
Losses were broad-based, driven by property, financial, and infrastructure shares.
United Tractors slumped near 15% after its unit Agincourt, operator of the Martabe gold and silver mine, was among those affected.
Astra Intl. dipped 11.3%, pressured by its stake in United Tractors, while Toba Pulp Lestari eased 0.8% as it sought clarification on the crackdown.
A modest rise in U.S.
futures helped cap further declines ahead of President Trump’s address at the World Economic Forum in Davos.
Investors now await Bank Indonesia’s policy decision, with rates widely expected to stay on hold for a fourth straight month. Trading Economics
--------
Malaysia tailors trade diplomacy to counter palm oil discrimination
Malaysia combats palm oil discrimination with tailored trade diplomacy, diversifying markets and boosting high-value exports to new regions.
KUALA LUMPUR: The government is employing a dynamic trade diplomacy strategy to counter discrimination against Malaysian palm oil.
Plantation and Commodities Minister Datuk Seri Dr Noraini Ahmad said the ministry tailors its approach to meet the specific needs of key international markets.
She outlined a comprehensive strategy focusing on compliance, market diversification and value-added activities within the industry.
Initiatives include targeting premium oil markets and encouraging industry transformation towards high-value products.
“We are strengthening the implementation of MSPO 2.0 to ensure that palm oil meets international standards,” Noraini said in Parliament.
She was responding to a supplementary question on measures to enhance exports amid international discrimination.
The ministry, through the Malaysian Palm Oil Council, is actively diversifying markets to reduce reliance on traditional buyers.
It is strengthening its presence in high-potential regions like Sub-Saharan Africa, the Middle East, North Africa and ASEAN.
As a result, 50% of Malaysia’s total palm oil exports went to these new markets in 2025. The SunMY
---------
Seed oils vs butter: Here's what’s actually healthier, according to doctors
With droves of wellness warriors choosing butter over seed oils, scientists weigh in on their favourite fats
Plant oils are “the biggest villain” out of “all the bullshit foods”. Not our words, but those of major health influencer (and big fan of raw milk) Dr Paul Saladino.
Extreme? Very likely. But Saladino’s anti-seed oil stance is no longer fringe. He’s joined in that opinion by swathes of dieters and nutritionists – as well as the US health secretary Robert F Kennedy Jr.
Kennedy has called seed oils “one of the most unhealthy ingredients that we have in foods,” and has advocated for the return of butter, tallow and lard to American diets, claiming that seed oils promote inflammation in the body.
It’s a sentiment reflecting a broader shift in eating habits, says Prof Thomas Sanders, nutrition scientist at King’s College London: “In the last few years, butter has come back on the menu. People are going back to full-fat milk, going back to eating butter.”
This is particularly true in the US, where the Department of Agriculture has reported steadily increasing levels of butter consumption in recent years, reaching a record 3kg (6.8lbs) – that’s the weight of a newborn baby – per person in 2024.
And these trends are worrying health professionals. That’s because, despite all the butter hype, the evidence still suggests that plant oils are a healthier choice.
“The evidence is really consistent,” says Prof Sarah Berry, nutrition scientist at King’s College London. “Randomised controlled trials show that plant oils are better for you, and butter is worse for you.” BBC Science Focus
January 20, 2026
Malaysia adopts diplomatic strategy to address discrimination against palm oil
KUALA LUMPUR (Jan 20): The government, through the Plantation and Commodities Ministry, has adopted a dynamic trade diplomacy strategy to address all forms of discrimination by tailoring its approach to specific key market needs.
Plantation and Commodities Minister Datuk Seri Dr Noraini Ahmad said the ministry has implemented a comprehensive approach to boost palm oil exports, focusing on compliance with international standards, market diversification and the generation of value-added activities within the palm oil industry.
“Among the initiatives undertaken by the ministry and its agencies are focusing on premium or high-quality oil markets, encouraging industry transformation towards high-value-added products, and at the same time, strengthening the implementation of MSPO 2.0 to ensure that palm oil meets international standards,” she said.
Noraini said this in response to a supplementary question from Riduan Rubin (Independent-Tenom) on the ministry's measures to enhance Malaysia's palm oil exports in light of discrimination at the international level.
Earlier, she said the ministry, through the Malaysian Palm Oil Council (MPOC), has implemented a market diversification strategy to reduce reliance on traditional markets such as India, China and the European Union.
At the same time, the ministry has also strengthened its presence in high-potential markets such as Sub-Saharan Africa, the Middle East, North Africa and Asean.
As a result, 50% of Malaysia’s total palm oil exports went to these new markets in 2025, while 30% were exported to traditional markets versus 43% in 2024, Noraini said.
Noraini said that the establishment of the Palm Oil Research and Technical Service Institute (PORTSIM) in Shanghai, China has also strengthened Malaysia-China industrial and trade relations through technology transfer, product innovation and the development of new palm oil applications.
For more Parliament stories, click here. The Edge
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Debunking Global Myths: Indonesia Pushes to Rebuild Palm Oil’s Image
PALMOILMAGAZINE, West Kalimantan — Indonesian palm oil continues to face strong negative narratives on the global stage, particularly around environmental and water-use issues. Bambang, Deputy for Plant Quarantine at the Indonesian Quarantine Agency (Barantin), said palm oil has long been unfairly targeted by misleading campaigns that distort scientific facts.
“Some claim oil palm is wasteful in its water consumption. In reality, it is one of the most efficient crops in absorbing and utilizing water,” Bambang explained. “Its evapotranspiration process even contributes to cloud formation and supports the natural water cycle.”
He called on all stakeholders—from government institutions and industry players to smallholders—to work together to strengthen the positive image of Indonesian palm oil internationally.
In the near future, Bambang is scheduled to attend meetings with the Dutch government in Rotterdam to explore cooperation opportunities in palm oil marketing and diplomatic outreach across Europe. “We want Rotterdam to become a strategic gateway for Indonesian palm oil into Europe, while also helping reverse the negative perceptions that have developed over the years,” he said optimistically.
Bambang also praised the role of the Plantation Fund Management Agency (BPDP), which since 2016 has disbursed substantial funding to support smallholder farmers. These funds have been allocated to smallholder replanting programs, research, human resource development, and international promotion efforts.
“In the early years, the portion of BPDP funds reaching farmers was very small—less than one percent of total collections. But today it has increased significantly, and the impact is real,” he told Palmoilmagazine.com. He noted that in 2016, only around 240 hectares of smallholder plantations were replanted. The following year, the program expanded rapidly to more than 20,000 hectares, and was later targeted to reach up to 185,000 hectares. Palm Oil Magazine
Malaysia adopts diplomatic strategy to address discrimination against palm oil
KUALA LUMPUR (Jan 20): The government, through the Plantation and Commodities Ministry, has adopted a dynamic trade diplomacy strategy to address all forms of discrimination by tailoring its approach to specific key market needs.
Plantation and Commodities Minister Datuk Seri Dr Noraini Ahmad said the ministry has implemented a comprehensive approach to boost palm oil exports, focusing on compliance with international standards, market diversification and the generation of value-added activities within the palm oil industry.
“Among the initiatives undertaken by the ministry and its agencies are focusing on premium or high-quality oil markets, encouraging industry transformation towards high-value-added products, and at the same time, strengthening the implementation of MSPO 2.0 to ensure that palm oil meets international standards,” she said.
Noraini said this in response to a supplementary question from Riduan Rubin (Independent-Tenom) on the ministry's measures to enhance Malaysia's palm oil exports in light of discrimination at the international level.
Earlier, she said the ministry, through the Malaysian Palm Oil Council (MPOC), has implemented a market diversification strategy to reduce reliance on traditional markets such as India, China and the European Union.
At the same time, the ministry has also strengthened its presence in high-potential markets such as Sub-Saharan Africa, the Middle East, North Africa and Asean.
As a result, 50% of Malaysia’s total palm oil exports went to these new markets in 2025, while 30% were exported to traditional markets versus 43% in 2024, Noraini said.
Noraini said that the establishment of the Palm Oil Research and Technical Service Institute (PORTSIM) in Shanghai, China has also strengthened Malaysia-China industrial and trade relations through technology transfer, product innovation and the development of new palm oil applications.
For more Parliament stories, click here. The Edge
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Debunking Global Myths: Indonesia Pushes to Rebuild Palm Oil’s Image
PALMOILMAGAZINE, West Kalimantan — Indonesian palm oil continues to face strong negative narratives on the global stage, particularly around environmental and water-use issues. Bambang, Deputy for Plant Quarantine at the Indonesian Quarantine Agency (Barantin), said palm oil has long been unfairly targeted by misleading campaigns that distort scientific facts.
“Some claim oil palm is wasteful in its water consumption. In reality, it is one of the most efficient crops in absorbing and utilizing water,” Bambang explained. “Its evapotranspiration process even contributes to cloud formation and supports the natural water cycle.”
He called on all stakeholders—from government institutions and industry players to smallholders—to work together to strengthen the positive image of Indonesian palm oil internationally.
In the near future, Bambang is scheduled to attend meetings with the Dutch government in Rotterdam to explore cooperation opportunities in palm oil marketing and diplomatic outreach across Europe. “We want Rotterdam to become a strategic gateway for Indonesian palm oil into Europe, while also helping reverse the negative perceptions that have developed over the years,” he said optimistically.
Bambang also praised the role of the Plantation Fund Management Agency (BPDP), which since 2016 has disbursed substantial funding to support smallholder farmers. These funds have been allocated to smallholder replanting programs, research, human resource development, and international promotion efforts.
“In the early years, the portion of BPDP funds reaching farmers was very small—less than one percent of total collections. But today it has increased significantly, and the impact is real,” he told Palmoilmagazine.com. He noted that in 2016, only around 240 hectares of smallholder plantations were replanted. The following year, the program expanded rapidly to more than 20,000 hectares, and was later targeted to reach up to 185,000 hectares. Palm Oil Magazine
January 19, 2026
The Paradox of Government Policy and the Eruption of Agrarian Conflicts in Indonesia
Throughout 2025, there were 341 outbreaks of agrarian conflict, the largest in the past five years. The KPA (National Commission for Agrarian Affairs and Spatial Planning) believes that paradoxical government policies contributed to these conflicts.
his video clip depicts several residents who have experienced criminalization and even persecution due to agrarian conflicts. The portrait of the grandmother wearing a caping (traditional hat), for example, is named Daeng Jintu. This female farmer is from Polongbangkeng, Takalar Regency, South Sulawesi.
He was criminalized after attempting to defend his land, which was in conflict with a state-owned sugarcane plantation company. This agrarian conflict is said to be inextricably linked to the government's efforts to achieve food and energy self-sufficiency. Kompas
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Standards and sustainability will make or break Indonesia–EU trade deal
In Brief
Indonesia’s free trade agreement with the European Union promises tariff reductions across almost all tariff lines. But access to the EU market is increasingly shaped by rules of origin, sustainability, traceability and due diligence. Palm oil and textiles show how sustainability requirements, smallholder supply chains and limited value-added processing can blunt gains from tariff reductions. Real economic benefits will depend on Indonesia’s capacity to meet EU standards.
The signing of the Indonesia–EU Comprehensive Economic Partnership Agreement (IEU–CEPA) in September 2025 marked a significant achievement for both parties. Beyond trade, the agreement reaffirms Indonesia’s bebas aktif (‘free and active’) foreign policy and strengthens engagement with advanced markets even as Jakarta deepens ties with groupings such as BRICS. The agreement offers tariff reductions or eliminations across nearly all tariff lines.
But access to the EU market is no longer dictated by tariffs alone. As tariff barriers recede, rules of origin, sustainability, standards, traceability and due diligence will determine Indonesia’s gains from the agreement. With the IEU–CEPA set to enter into force in 2027, Indonesia faces the decisive question of whether its industries can adapt quickly enough to a world where standards and sustainability are a primary source of competitiveness. The answer will shape Indonesia’s ability to participate in a standards-focused global economy. East Asia Forum
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Indonesia To Oblige Aviation Industry Using SAF, Possibly From 2026
JAKARTA — The Indonesian government has planned to oblige the use of bioavtur or sustainable aviation fuel (SAF) in aviation industry since 2026 or 2027. It will be started with the international flights.
Effendi Manurung, Head of Bioenergy Engineering and Environment Sub-division at the renewable energy and energy conservation directorate general of the ministry of energy and mineral resources (KESDM), said that basically the roadmap of bioavtur had been designed by the coordinating ministry of maritime and investment, ruling the SAF blending of 1% in 2027 and up to 5% in 2029.
Effendi said that KESDM opened an opportunity of advancing the implementation of SAF-1% for international flights in 2026. But it has not yet determined whether it will be implemented as mandatory at once or in stages. “Our superiors hope that it can be started in 2026. But it’s not yet certain whether it will be mandatory or not. We’re still in a process of finalizing the plan,” he said during the FGD on Life Cycle Assessment of Production of Sustainable Aviation Fuel in Jakarta on Thursday (30/10/2025).
Effendi said that the SAF-1% implementation plan is designed by considering a number of issues, including supply and prices. He admitted that currently the price of bioavtur in the form of SAF-1% is more expensive than conventional avtur.
If it were obliged for all flights, both international and domestic, it would directly impact ticket prices paid by passengers. Furthermore, there is no policy yet regulating incentives for the use of bioavtur.
“There are no incentives yet, and to avoid a major issue [of ticket price increases], the international flights will be subjected first. This was the recommendation from the Coordinating Minister for Maritime Affairs and Investment at the time,” he said.
It is based on the consideration that international flights have been now recovering from the negative impacts of the Covid-19 pandemic as compared to domestic flights, which are still struggling. GAPKI
The Paradox of Government Policy and the Eruption of Agrarian Conflicts in Indonesia
Throughout 2025, there were 341 outbreaks of agrarian conflict, the largest in the past five years. The KPA (National Commission for Agrarian Affairs and Spatial Planning) believes that paradoxical government policies contributed to these conflicts.
his video clip depicts several residents who have experienced criminalization and even persecution due to agrarian conflicts. The portrait of the grandmother wearing a caping (traditional hat), for example, is named Daeng Jintu. This female farmer is from Polongbangkeng, Takalar Regency, South Sulawesi.
He was criminalized after attempting to defend his land, which was in conflict with a state-owned sugarcane plantation company. This agrarian conflict is said to be inextricably linked to the government's efforts to achieve food and energy self-sufficiency. Kompas
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Standards and sustainability will make or break Indonesia–EU trade deal
In Brief
Indonesia’s free trade agreement with the European Union promises tariff reductions across almost all tariff lines. But access to the EU market is increasingly shaped by rules of origin, sustainability, traceability and due diligence. Palm oil and textiles show how sustainability requirements, smallholder supply chains and limited value-added processing can blunt gains from tariff reductions. Real economic benefits will depend on Indonesia’s capacity to meet EU standards.
The signing of the Indonesia–EU Comprehensive Economic Partnership Agreement (IEU–CEPA) in September 2025 marked a significant achievement for both parties. Beyond trade, the agreement reaffirms Indonesia’s bebas aktif (‘free and active’) foreign policy and strengthens engagement with advanced markets even as Jakarta deepens ties with groupings such as BRICS. The agreement offers tariff reductions or eliminations across nearly all tariff lines.
But access to the EU market is no longer dictated by tariffs alone. As tariff barriers recede, rules of origin, sustainability, standards, traceability and due diligence will determine Indonesia’s gains from the agreement. With the IEU–CEPA set to enter into force in 2027, Indonesia faces the decisive question of whether its industries can adapt quickly enough to a world where standards and sustainability are a primary source of competitiveness. The answer will shape Indonesia’s ability to participate in a standards-focused global economy. East Asia Forum
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Indonesia To Oblige Aviation Industry Using SAF, Possibly From 2026
JAKARTA — The Indonesian government has planned to oblige the use of bioavtur or sustainable aviation fuel (SAF) in aviation industry since 2026 or 2027. It will be started with the international flights.
Effendi Manurung, Head of Bioenergy Engineering and Environment Sub-division at the renewable energy and energy conservation directorate general of the ministry of energy and mineral resources (KESDM), said that basically the roadmap of bioavtur had been designed by the coordinating ministry of maritime and investment, ruling the SAF blending of 1% in 2027 and up to 5% in 2029.
Effendi said that KESDM opened an opportunity of advancing the implementation of SAF-1% for international flights in 2026. But it has not yet determined whether it will be implemented as mandatory at once or in stages. “Our superiors hope that it can be started in 2026. But it’s not yet certain whether it will be mandatory or not. We’re still in a process of finalizing the plan,” he said during the FGD on Life Cycle Assessment of Production of Sustainable Aviation Fuel in Jakarta on Thursday (30/10/2025).
Effendi said that the SAF-1% implementation plan is designed by considering a number of issues, including supply and prices. He admitted that currently the price of bioavtur in the form of SAF-1% is more expensive than conventional avtur.
If it were obliged for all flights, both international and domestic, it would directly impact ticket prices paid by passengers. Furthermore, there is no policy yet regulating incentives for the use of bioavtur.
“There are no incentives yet, and to avoid a major issue [of ticket price increases], the international flights will be subjected first. This was the recommendation from the Coordinating Minister for Maritime Affairs and Investment at the time,” he said.
It is based on the consideration that international flights have been now recovering from the negative impacts of the Covid-19 pandemic as compared to domestic flights, which are still struggling. GAPKI
January 17, 2026
Indonesia Attracts $3.7 Billion Investment to Climb Up Palm Oil Value Chain
Jakarta. Indonesia attracted Rp 62.8 trillion ($3.7 billion) worth of investments in the palm oil sector last year, with all the money meant to enable the country create higher-value products from this agricultural commodity.
Over the past years, the resource-rich Indonesia has been wanting to climb up the value chain. To this end, the country has been opening its doors for investors who wish to set up factories that can process its natural resources, such as palm oil, into more sophisticated goods. Investment Minister Rosan Roeslani revealed that investors had put tens of trillions of rupiahs into the Indonesian palm oil downstream industry throughout 2025.
“This downstream policy is about capturing more value out of our commodities at home because it has a multiplier economic impact and can create jobs,” Rosan told a press briefing in Jakarta on Thursday.
“Not only does it boost the economy, but having all the manufacturing in Indonesia allows us to improve our [human] capital by introducing them to new technologies. … And we will continue to encourage this in the palm oil industry,” Rosan said.
The minister did not go into details on whether it was mainly domestic or foreign investors who had been backing the industrial value creation push in the palm oil industry. However, data showed that Indonesia amassed around Rp 6.6 trillion worth of investments in “other forestry sectors”, which included nutmegs, pine, coconut, cacao, and biofuel. Jakarta Globe
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Indonesia’s B50 delay opens short-term export window for Malaysian palm oil
KUALA LUMPUR: Indonesia’s decision to delay the implementation of the B50 biodiesel mandate presents Malaysia with a short-term opportunity to increase palm oil exports as the commodity’s price is kept stable by the move, according to an academic.
Dr Chong Siew Huay, a senior lecturer at the Faculty of Business and Management, Universiti Teknologi MARA (UiTM), said the postponement means Indonesia will absorb less crude palm oil (CPO) domestically for biodiesel than originally planned, as the country retains the B40 mandate for now.
"In the short term, global demand for palm oil is slightly lower than expected because Indonesia’s domestic biodiesel demand is not increasing as quickly as anticipated with the B50,” she told Bernama.
She noted that with Indonesia absorbing less CPO domestically, more palm oil would be channelled into international markets, creating opportunities for Malaysia to increase exports, particularly in markets where Indonesia is a direct competitor.
"This could ease pressure on palm oil supply in the global market and help to maintain stable domestic and export conditions,” she said, adding that prices are likely to stabilise or rise more slowly than previously anticipated as reduced domestic demand lessens upward pressure on CPO prices.
Chong said Malaysia’s longer-term competitiveness in the global palm oil market would depend on factors such as productivity, the development of value-added products including refined palm oil and oleochemicals, as well as sustainability practices, rather than relying solely on Indonesia’s policy decisions.
She explained that Indonesia’s decision to delay the B50 rollout was driven mainly by fiscal sustainability concerns, as higher biodiesel blending ratios would substantially increase subsidy requirements, particularly during periods of high CPO prices and uncertain global energy markets. "Moving from B40 to B50 would amplify the government’s exposure to price volatility and budgetary pressure, raising concerns over fiscal capacity and economic stability,” she said. The StarMY
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Palm Oil Prices Rose As US Biofuel Targets Raised Demand Hopes
Palm followed soybean oil higher after the US signaled bigger 2026 blending volumes, with stronger Malaysian exports and a softer ringgit adding support.
What’s going on here?
Palm oil prices jumped after the US signaled higher 2026 biofuel blending volumes, boosting demand expectations across the vegetable-oils market.
What does this mean?
Malaysian palm oil futures closed about 2% higher at 4,071 ringgit a metric ton, extending a second weekly gain. The move tracked a rally in soybean oil after the US said it aims to finalize 2026 biofuel quotas by March, with investors bracing for higher blending than in 2025. That matters because biodiesel and renewable diesel soak up huge volumes of oils like soy and palm, and the two feedstocks tend to move together as they compete for global buyers. Finimize
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Genting Plantations’ Indonesian unit fined RM97m by forest task force
KUALA LUMPUR (Jan 16): Genting Plantations Bhd (KL:GENP) said on Friday its Indonesian unit has been fined 396 billion rupiah (RM96.6 million) by Indonesia’s Forest Area Enforcement Task Force for alleged non-compliance in forest-designated areas.
The Malaysian plantation group said its 95%-owned indirect subsidiary, PT Susantri Permai, had received an interim notice from the task force and has since paid the fine. The notice is pending finalisation by the authority, Genting Plantations said in a filing with Bursa Malaysia on Friday.
The group did not disclose details of the alleged breach, nor did it say whether the penalty would have a material impact on its financial performance.
Indonesia has stepped up enforcement against plantation companies operating illegally in forest-designated zones, with significant portions of seized land being transferred to state-owned plantation firm Agrinas Palma Nusantara.
Genting Plantations, a unit of Genting Bhd (KL:GENTING), has a landbank of about 64,300ha in Malaysia and around 178,900ha in Indonesia, including plasma schemes, according to its annual report. It operates seven palm oil mills in Malaysia and six in Indonesia, with a combined milling capacity of 725 tonnes per hour.
Shares in Genting Plantations were up 0.4% at RM5.16 at midday break on Friday, giving the group a market capitalisation of RM4.63 billion. The stock has fallen 9.31% over the past year. The EdgeMY
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Liberia: LACRA Announces Introduction of Palm Oil Sector Policy Validation Process Commences
MONROVIA –The Liberia Agriculture Commodity Regulatory Authority (LACRA) has formally announced the introduction of a national policy framework for the palm oil sector under its regulatory regime, marking a major milestone in the structured governance and development of one of Liberia’s most important agricultural value chains.
In an announcement issued on Thursday, January 15, 2026, the LACRA disclosed that stakeholder consultations and policy validation activities have officially begun. The Authority said this represents the first comprehensive policy process for the palm oil sector since LACRA was established, underscoring its mandate to regulate, develop, and promote key agricultural commodities in a coordinated and transparent manner.
According to LACRA, the palm oil sector plays a critical role in Liberia’s rural economy, supporting thousands of smallholder farmers, artisanal processors, traders, and cooperatives across multiple counties. Despite its significance for livelihoods, food security, and domestic commerce, the sector has historically operated without a unified regulatory and policy framework, resulting in fragmented oversight, inconsistent standards, and limited sector-wide data.
The introduction of the palm oil policy under LACRA’s authority is intended to address these gaps by providing a clear framework to guide production, processing, marketing, pricing, traceability, and sustainability. LACRA said the policy will also clarify institutional roles, strengthen compliance mechanisms, and improve coordination among sector actors, including farmers, processors, exporters, and relevant public institutions. Front Page Africa
Indonesia Attracts $3.7 Billion Investment to Climb Up Palm Oil Value Chain
Jakarta. Indonesia attracted Rp 62.8 trillion ($3.7 billion) worth of investments in the palm oil sector last year, with all the money meant to enable the country create higher-value products from this agricultural commodity.
Over the past years, the resource-rich Indonesia has been wanting to climb up the value chain. To this end, the country has been opening its doors for investors who wish to set up factories that can process its natural resources, such as palm oil, into more sophisticated goods. Investment Minister Rosan Roeslani revealed that investors had put tens of trillions of rupiahs into the Indonesian palm oil downstream industry throughout 2025.
“This downstream policy is about capturing more value out of our commodities at home because it has a multiplier economic impact and can create jobs,” Rosan told a press briefing in Jakarta on Thursday.
“Not only does it boost the economy, but having all the manufacturing in Indonesia allows us to improve our [human] capital by introducing them to new technologies. … And we will continue to encourage this in the palm oil industry,” Rosan said.
The minister did not go into details on whether it was mainly domestic or foreign investors who had been backing the industrial value creation push in the palm oil industry. However, data showed that Indonesia amassed around Rp 6.6 trillion worth of investments in “other forestry sectors”, which included nutmegs, pine, coconut, cacao, and biofuel. Jakarta Globe
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Indonesia’s B50 delay opens short-term export window for Malaysian palm oil
KUALA LUMPUR: Indonesia’s decision to delay the implementation of the B50 biodiesel mandate presents Malaysia with a short-term opportunity to increase palm oil exports as the commodity’s price is kept stable by the move, according to an academic.
Dr Chong Siew Huay, a senior lecturer at the Faculty of Business and Management, Universiti Teknologi MARA (UiTM), said the postponement means Indonesia will absorb less crude palm oil (CPO) domestically for biodiesel than originally planned, as the country retains the B40 mandate for now.
"In the short term, global demand for palm oil is slightly lower than expected because Indonesia’s domestic biodiesel demand is not increasing as quickly as anticipated with the B50,” she told Bernama.
She noted that with Indonesia absorbing less CPO domestically, more palm oil would be channelled into international markets, creating opportunities for Malaysia to increase exports, particularly in markets where Indonesia is a direct competitor.
"This could ease pressure on palm oil supply in the global market and help to maintain stable domestic and export conditions,” she said, adding that prices are likely to stabilise or rise more slowly than previously anticipated as reduced domestic demand lessens upward pressure on CPO prices.
Chong said Malaysia’s longer-term competitiveness in the global palm oil market would depend on factors such as productivity, the development of value-added products including refined palm oil and oleochemicals, as well as sustainability practices, rather than relying solely on Indonesia’s policy decisions.
She explained that Indonesia’s decision to delay the B50 rollout was driven mainly by fiscal sustainability concerns, as higher biodiesel blending ratios would substantially increase subsidy requirements, particularly during periods of high CPO prices and uncertain global energy markets. "Moving from B40 to B50 would amplify the government’s exposure to price volatility and budgetary pressure, raising concerns over fiscal capacity and economic stability,” she said. The StarMY
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Palm Oil Prices Rose As US Biofuel Targets Raised Demand Hopes
Palm followed soybean oil higher after the US signaled bigger 2026 blending volumes, with stronger Malaysian exports and a softer ringgit adding support.
What’s going on here?
Palm oil prices jumped after the US signaled higher 2026 biofuel blending volumes, boosting demand expectations across the vegetable-oils market.
What does this mean?
Malaysian palm oil futures closed about 2% higher at 4,071 ringgit a metric ton, extending a second weekly gain. The move tracked a rally in soybean oil after the US said it aims to finalize 2026 biofuel quotas by March, with investors bracing for higher blending than in 2025. That matters because biodiesel and renewable diesel soak up huge volumes of oils like soy and palm, and the two feedstocks tend to move together as they compete for global buyers. Finimize
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Genting Plantations’ Indonesian unit fined RM97m by forest task force
KUALA LUMPUR (Jan 16): Genting Plantations Bhd (KL:GENP) said on Friday its Indonesian unit has been fined 396 billion rupiah (RM96.6 million) by Indonesia’s Forest Area Enforcement Task Force for alleged non-compliance in forest-designated areas.
The Malaysian plantation group said its 95%-owned indirect subsidiary, PT Susantri Permai, had received an interim notice from the task force and has since paid the fine. The notice is pending finalisation by the authority, Genting Plantations said in a filing with Bursa Malaysia on Friday.
The group did not disclose details of the alleged breach, nor did it say whether the penalty would have a material impact on its financial performance.
Indonesia has stepped up enforcement against plantation companies operating illegally in forest-designated zones, with significant portions of seized land being transferred to state-owned plantation firm Agrinas Palma Nusantara.
Genting Plantations, a unit of Genting Bhd (KL:GENTING), has a landbank of about 64,300ha in Malaysia and around 178,900ha in Indonesia, including plasma schemes, according to its annual report. It operates seven palm oil mills in Malaysia and six in Indonesia, with a combined milling capacity of 725 tonnes per hour.
Shares in Genting Plantations were up 0.4% at RM5.16 at midday break on Friday, giving the group a market capitalisation of RM4.63 billion. The stock has fallen 9.31% over the past year. The EdgeMY
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Liberia: LACRA Announces Introduction of Palm Oil Sector Policy Validation Process Commences
MONROVIA –The Liberia Agriculture Commodity Regulatory Authority (LACRA) has formally announced the introduction of a national policy framework for the palm oil sector under its regulatory regime, marking a major milestone in the structured governance and development of one of Liberia’s most important agricultural value chains.
In an announcement issued on Thursday, January 15, 2026, the LACRA disclosed that stakeholder consultations and policy validation activities have officially begun. The Authority said this represents the first comprehensive policy process for the palm oil sector since LACRA was established, underscoring its mandate to regulate, develop, and promote key agricultural commodities in a coordinated and transparent manner.
According to LACRA, the palm oil sector plays a critical role in Liberia’s rural economy, supporting thousands of smallholder farmers, artisanal processors, traders, and cooperatives across multiple counties. Despite its significance for livelihoods, food security, and domestic commerce, the sector has historically operated without a unified regulatory and policy framework, resulting in fragmented oversight, inconsistent standards, and limited sector-wide data.
The introduction of the palm oil policy under LACRA’s authority is intended to address these gaps by providing a clear framework to guide production, processing, marketing, pricing, traceability, and sustainability. LACRA said the policy will also clarify institutional roles, strengthen compliance mechanisms, and improve coordination among sector actors, including farmers, processors, exporters, and relevant public institutions. Front Page Africa
January 16, 2026
US clears FGV to export palm oil after modification of withhold release order
KUALA LUMPUR (Jan 16): The US has cleared FGV Holdings Bhd to export palm oil and palm oil products to the US effective Jan 15, 2026, following modification of the withhold release order (WRO).
In a statement on Friday, FGV said the US Customs and Border Protection (CBP) had confirmed that products from FGV, its subsidiaries and joint ventures are now admissible into US commerce, provided they comply with all applicable US laws and regulations.
"FGV wishes to express our appreciation to the CBP for its guidance and responsiveness in modifying the WRO and recognising the group’s effort in remediating and enhancing labour practices.
"The group also extends our gratitude to the Malaysian government and all stakeholders for their continued support and understanding throughout this process," the statement said.
he group said the modification follows FGV’s sustained and comprehensive efforts to strengthen its labour practices in line with national regulations and international standards.
"These efforts included the implementation of a robust action plan to ensure that there are no International Labour Organization (ILO) indicators of forced labour and child labour in FGV’s operations," it added.
Among key actions undertaken by FGV included strengthening recruitment procedures to align with ethical and responsible recruitment principles and standards, implementing a recruitment fee reimbursement programme and collaborating with the National Union of Plantation Workers (NUPW) to promote workers’ right to freedom of association and union membership.
FGV group chief executive officer Datuk Fakhrunniam Othman said the WRO modification is an important milestone for the group and reflects the progress made by consistently doing things right and ethically. The Edge
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MPOB: Palm oil sector must evolve with sustainability driven innovation
KUALA LUMPUR: The Malaysian Palm Oil Board (MPOB) has emphasised that the future direction of the national palm oil industry must be dynamic, anchored in sustainability and traceability, and focused on expanding downstream products to strengthen its long-term position amid an increasingly complex global landscape.
The Palm Oil Economic Review and Outlook Seminar 2026 (R&O 2026), held at Berjaya Times Square Hotel here on Tuesday, brought together more than 400 industry players, and academics to deliberate on market performance in 2025, prospects for 2026, and strategic directions for Malaysia’s palm oil sector.
Themed ‘Securing the Future of Palm Oil in a Changing Global Economy’, the programme was officiated by Minister of Plantation and Commodities Datuk Seri Dr Noraini Ahmad.
In her keynote address, Noraini said Malaysia’s palm oil competitiveness hinges on three core pillars higher productivity, stronger sustainability assurance, and faster adoption of innovation while remaining agile in managing market expectations and operational realities.
“Malaysia continues to lead the palm oil industry not merely in terms of production volume, but through quality, credibility and long-term value,” she said.
Unlike previous editions, R&O 2026 was extended two days to allow for more focused and targeted discussions, enabling industry practitioners, researchers and policymakers to gain updated insights from MPOB as well as market projections from invited analysts.
MPOB chairman Datuk Mohamad Helmy Othman Basha said the industry’s future direction and strategies require a more holistic and forward-looking approach that integrates market research, scientific studies, legislation and operational realities.
During the opening ceremony, MPOB also launched a book titled ‘Small Bites, Big Impact – The Red Palm Oil Biscuit Story’, which highlights findings from the Red Palm Oil (RPO) Supplementation Study conducted in collaboration with Universiti Malaya.
Available for free on MPOB’s Palmoilis website, the publication outlines the effectiveness of red palm oil–based biscuits in improving provitamin A levels, iron status, blood profiles and gut health, as well as in reducing inflammation, vision problems and parasitic infections among children.
The seminar also witnessed the exchange of a memorandum of agreement (MoA) between MPOB, represented by its Director-General Datuk Dr Ahmad Parveez Ghulam Kadir, and Aerodyne Geospatial Sdn Bhd, represented by its founder and Group Chief Executive Officer Datuk Kamarul A. Muhamed.
The collaboration aims to enhance the Oil Palm Estate Monitoring System through the development of an integrated digital platform capable of realtime monitoring of plantation activities, including harvesting, fertilisation, mechanisation, labour utilisation and overall operational performance.
The system is expected to support more efficient, waste-free resource and estate management, while enabling policymakers and industry stakeholders to make more informed, data-driven decisions. The Borneo Post
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Indonesia vows action against laggards on forestry fines
The unprecendented crackdown targeting oil palm plantations and mines has unnerved the industry
[JAKARTA] Indonesia’s military-backed forestry task force has threatened legal action against dozens of plantation and mining companies refusing to pay hefty fines for operations in forest areas that authorities deem illegal.
Goodhope Group, part of Sri Lankan conglomerate Carson Cumberbatch, and Singapore-based Musim Mas Group were among companies that did not attend when summoned, the task force said in an Instagram posting.
The unprecendented crackdown since last year targeting oil palm plantations and mines has unnerved the industry, buoying global palm prices for fear it will hit output, and more recently, triggering rallies in the prices of metals like tin.
“For companies that still object, those that fail to appear for summons or continue unauthorised activities in forest areas, the task force will take more progressive legal action to ensure the state’s sovereignty,” spokesperson Barita Simanjuntak said.
The task force has taken over 8,800 hectares of mining areas turning out items such as nickel, coal, quartz sand and limestone, and palm planations across 4.1 million hectares or roughly the size of the Netherlands, it said in Wednesday’s (Jan 14) statement.
As many as 25 of the 32 mine companies and 29 of the 83 plantation firms summoned to pay fines have objected, failed to attend or sought rescheduling, it said.
Seven mining and 54 palm oil companies have paid or agreed to pay fines of US$552 million, the task force added.
Companies that complied include the palm oil units of conglomerate Salim Group which paid fines equivalent to US136 million, Best Agro Group, which forked over US$98 million in fines, and US$57 million by a unit of Sampoerna Agro.
Astra Agro Lestari also paid a fine of US$34 million, the task force added in the Instagram post. Business Times
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Latin America Needs Incentives to Unlock SAF Potential: IATA
Latin America must develop a clearer understanding of its potential to produce sustainable aviation fuel (SAF) and implement public policies that enable industrial development, according to Daniel Chereau, Head Fuel, International Air Transport Association (IATA), in an interview with A21.
Chereau said global adoption of SAF will advance at different speeds depending on regional conditions and regulatory frameworks. “What is missing in Latin America is understanding the potential as producers and that governments establish public policies that deliver incentives” he said.
He noted that Brazil is among the most advanced markets in the region, largely due to ethanol policies that have been in place for more than 50 years. “From that perspective, it is natural to expect Brazil to have a more developed SAF industry,” Chereau said.
In Mexico, discussions are underway with sugar producers amid declining demand for sugar and growing interest in biofuels as an alternative outlet. Chereau recalled that Mexico’s airport and fuel services agency, Aeropuertos y Servicios Auxiliares (ASA), previously developed a “flight plan” aimed at integrating stakeholders across the aviation value chain. Despite long-standing interest, he said the initiative lacked the incentive policies needed for implementation.
ASA, Mexico’s main jet fuel supplier, serves 52 airports and supplies more than 90% of the domestic market. The agency aims to promote clean energy use and support the aviation sector’s sustainable transition through the development and deployment of SAF. Infrastructure, Communications and Transportation Minister Jesús Esteva said at ASA’s 60th anniversary event that SAF implementation is “one of the biggest challenges” facing the aviation sector and that ASA must lead efforts to expand supply.
ASA Director Carlos Merino said the agency has launched a pilot project to blend imported SAF with conventional jet fuel, with a long-term goal of producing SAF domestically by 2030. In the near term, imports—likely from the United States—will remain necessary. Mexico also participates in ICAO’s CORSIA scheme, which includes a voluntary phase from 2024 to 2026 and mandatory targets from 2027 to 2035.
According to Guillermo Gómez, CEO, Consultoría Sustentable G2H, Mexico’s primary SAF advantage lies in its biomass resources, including agricultural, forestry and urban waste, used cooking oils and potential power-to-liquid pathways. Sugarcane and sorghum stand out due to their scale and integration potential. Sugarcane alone covers more than 800,000 hectares across at least 15 states and supports the production of sugar, bagasse, bioelectricity and ethanol.
Despite this strong feedstock base, Mexico lacks pilot plants, industrial-scale projects and refineries adapted for SAF production, as well as intersectoral consortia. Gómez said this gap represents an opportunity to build capacity through research, financing and innovation, but would require coordinated efforts among government, industry and rural producers.
In Colombia, palm oil producers have expressed interest in entering the SAF market, a process Chereau described as similar to Mexico’s engagement with the sugar industry. Meanwhile, Chile has promoted green hydrogen as a key energy vector and set a target to begin SAF production by 2030, with projections extending to 2050. “Latin America is a vast region with regulatory fragmentation and differing sustainability policies, but there are emerging signals in certain countries,” Chereau said. Mexico Business
US clears FGV to export palm oil after modification of withhold release order
KUALA LUMPUR (Jan 16): The US has cleared FGV Holdings Bhd to export palm oil and palm oil products to the US effective Jan 15, 2026, following modification of the withhold release order (WRO).
In a statement on Friday, FGV said the US Customs and Border Protection (CBP) had confirmed that products from FGV, its subsidiaries and joint ventures are now admissible into US commerce, provided they comply with all applicable US laws and regulations.
"FGV wishes to express our appreciation to the CBP for its guidance and responsiveness in modifying the WRO and recognising the group’s effort in remediating and enhancing labour practices.
"The group also extends our gratitude to the Malaysian government and all stakeholders for their continued support and understanding throughout this process," the statement said.
he group said the modification follows FGV’s sustained and comprehensive efforts to strengthen its labour practices in line with national regulations and international standards.
"These efforts included the implementation of a robust action plan to ensure that there are no International Labour Organization (ILO) indicators of forced labour and child labour in FGV’s operations," it added.
Among key actions undertaken by FGV included strengthening recruitment procedures to align with ethical and responsible recruitment principles and standards, implementing a recruitment fee reimbursement programme and collaborating with the National Union of Plantation Workers (NUPW) to promote workers’ right to freedom of association and union membership.
FGV group chief executive officer Datuk Fakhrunniam Othman said the WRO modification is an important milestone for the group and reflects the progress made by consistently doing things right and ethically. The Edge
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MPOB: Palm oil sector must evolve with sustainability driven innovation
KUALA LUMPUR: The Malaysian Palm Oil Board (MPOB) has emphasised that the future direction of the national palm oil industry must be dynamic, anchored in sustainability and traceability, and focused on expanding downstream products to strengthen its long-term position amid an increasingly complex global landscape.
The Palm Oil Economic Review and Outlook Seminar 2026 (R&O 2026), held at Berjaya Times Square Hotel here on Tuesday, brought together more than 400 industry players, and academics to deliberate on market performance in 2025, prospects for 2026, and strategic directions for Malaysia’s palm oil sector.
Themed ‘Securing the Future of Palm Oil in a Changing Global Economy’, the programme was officiated by Minister of Plantation and Commodities Datuk Seri Dr Noraini Ahmad.
In her keynote address, Noraini said Malaysia’s palm oil competitiveness hinges on three core pillars higher productivity, stronger sustainability assurance, and faster adoption of innovation while remaining agile in managing market expectations and operational realities.
“Malaysia continues to lead the palm oil industry not merely in terms of production volume, but through quality, credibility and long-term value,” she said.
Unlike previous editions, R&O 2026 was extended two days to allow for more focused and targeted discussions, enabling industry practitioners, researchers and policymakers to gain updated insights from MPOB as well as market projections from invited analysts.
MPOB chairman Datuk Mohamad Helmy Othman Basha said the industry’s future direction and strategies require a more holistic and forward-looking approach that integrates market research, scientific studies, legislation and operational realities.
During the opening ceremony, MPOB also launched a book titled ‘Small Bites, Big Impact – The Red Palm Oil Biscuit Story’, which highlights findings from the Red Palm Oil (RPO) Supplementation Study conducted in collaboration with Universiti Malaya.
Available for free on MPOB’s Palmoilis website, the publication outlines the effectiveness of red palm oil–based biscuits in improving provitamin A levels, iron status, blood profiles and gut health, as well as in reducing inflammation, vision problems and parasitic infections among children.
The seminar also witnessed the exchange of a memorandum of agreement (MoA) between MPOB, represented by its Director-General Datuk Dr Ahmad Parveez Ghulam Kadir, and Aerodyne Geospatial Sdn Bhd, represented by its founder and Group Chief Executive Officer Datuk Kamarul A. Muhamed.
The collaboration aims to enhance the Oil Palm Estate Monitoring System through the development of an integrated digital platform capable of realtime monitoring of plantation activities, including harvesting, fertilisation, mechanisation, labour utilisation and overall operational performance.
The system is expected to support more efficient, waste-free resource and estate management, while enabling policymakers and industry stakeholders to make more informed, data-driven decisions. The Borneo Post
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Indonesia vows action against laggards on forestry fines
The unprecendented crackdown targeting oil palm plantations and mines has unnerved the industry
[JAKARTA] Indonesia’s military-backed forestry task force has threatened legal action against dozens of plantation and mining companies refusing to pay hefty fines for operations in forest areas that authorities deem illegal.
Goodhope Group, part of Sri Lankan conglomerate Carson Cumberbatch, and Singapore-based Musim Mas Group were among companies that did not attend when summoned, the task force said in an Instagram posting.
The unprecendented crackdown since last year targeting oil palm plantations and mines has unnerved the industry, buoying global palm prices for fear it will hit output, and more recently, triggering rallies in the prices of metals like tin.
“For companies that still object, those that fail to appear for summons or continue unauthorised activities in forest areas, the task force will take more progressive legal action to ensure the state’s sovereignty,” spokesperson Barita Simanjuntak said.
The task force has taken over 8,800 hectares of mining areas turning out items such as nickel, coal, quartz sand and limestone, and palm planations across 4.1 million hectares or roughly the size of the Netherlands, it said in Wednesday’s (Jan 14) statement.
As many as 25 of the 32 mine companies and 29 of the 83 plantation firms summoned to pay fines have objected, failed to attend or sought rescheduling, it said.
Seven mining and 54 palm oil companies have paid or agreed to pay fines of US$552 million, the task force added.
Companies that complied include the palm oil units of conglomerate Salim Group which paid fines equivalent to US136 million, Best Agro Group, which forked over US$98 million in fines, and US$57 million by a unit of Sampoerna Agro.
Astra Agro Lestari also paid a fine of US$34 million, the task force added in the Instagram post. Business Times
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Latin America Needs Incentives to Unlock SAF Potential: IATA
Latin America must develop a clearer understanding of its potential to produce sustainable aviation fuel (SAF) and implement public policies that enable industrial development, according to Daniel Chereau, Head Fuel, International Air Transport Association (IATA), in an interview with A21.
Chereau said global adoption of SAF will advance at different speeds depending on regional conditions and regulatory frameworks. “What is missing in Latin America is understanding the potential as producers and that governments establish public policies that deliver incentives” he said.
He noted that Brazil is among the most advanced markets in the region, largely due to ethanol policies that have been in place for more than 50 years. “From that perspective, it is natural to expect Brazil to have a more developed SAF industry,” Chereau said.
In Mexico, discussions are underway with sugar producers amid declining demand for sugar and growing interest in biofuels as an alternative outlet. Chereau recalled that Mexico’s airport and fuel services agency, Aeropuertos y Servicios Auxiliares (ASA), previously developed a “flight plan” aimed at integrating stakeholders across the aviation value chain. Despite long-standing interest, he said the initiative lacked the incentive policies needed for implementation.
ASA, Mexico’s main jet fuel supplier, serves 52 airports and supplies more than 90% of the domestic market. The agency aims to promote clean energy use and support the aviation sector’s sustainable transition through the development and deployment of SAF. Infrastructure, Communications and Transportation Minister Jesús Esteva said at ASA’s 60th anniversary event that SAF implementation is “one of the biggest challenges” facing the aviation sector and that ASA must lead efforts to expand supply.
ASA Director Carlos Merino said the agency has launched a pilot project to blend imported SAF with conventional jet fuel, with a long-term goal of producing SAF domestically by 2030. In the near term, imports—likely from the United States—will remain necessary. Mexico also participates in ICAO’s CORSIA scheme, which includes a voluntary phase from 2024 to 2026 and mandatory targets from 2027 to 2035.
According to Guillermo Gómez, CEO, Consultoría Sustentable G2H, Mexico’s primary SAF advantage lies in its biomass resources, including agricultural, forestry and urban waste, used cooking oils and potential power-to-liquid pathways. Sugarcane and sorghum stand out due to their scale and integration potential. Sugarcane alone covers more than 800,000 hectares across at least 15 states and supports the production of sugar, bagasse, bioelectricity and ethanol.
Despite this strong feedstock base, Mexico lacks pilot plants, industrial-scale projects and refineries adapted for SAF production, as well as intersectoral consortia. Gómez said this gap represents an opportunity to build capacity through research, financing and innovation, but would require coordinated efforts among government, industry and rural producers.
In Colombia, palm oil producers have expressed interest in entering the SAF market, a process Chereau described as similar to Mexico’s engagement with the sugar industry. Meanwhile, Chile has promoted green hydrogen as a key energy vector and set a target to begin SAF production by 2030, with projections extending to 2050. “Latin America is a vast region with regulatory fragmentation and differing sustainability policies, but there are emerging signals in certain countries,” Chereau said. Mexico Business
January 15, 2026
Indonesia’s Biodiesel Shift: B50 Plan Put on Hold, Raising Questions for Global Palm Oil Markets
Jakarta, January 2026 — Indonesia has shelved plans to introduce a 50 % palm oil-based biodiesel blend (B50) this year, opting instead to retain its current 40 % biodiesel mandate (B40) amid ongoing technical and economic concerns.
The decision, made public this week by government officials, comes as Jakarta grapples with the practical challenges of scaling up its renewable fuel program — once touted as a major step toward energy self-sufficiency and a significant factor in global palm oil demand.
What Changed? From B50 to B40
Indonesia, the world’s largest producer and exporter of crude palm oil, had earlier targeted a mandatory B50 blend for 2026. Under that plan, diesel would contain equal parts conventional fossil fuel and biodiesel derived from palm oil — double the biofuel content currently mandated in B40.
However, officials say that technical feasibility and funding constraints — including the cost of subsidizing the more aggressive blend — made it impractical to roll out B50 as initially scheduled. Instead, the government confirmed that B40 will remain in place throughout 2026, with the B50 rollout still under study.
SEE ALSO Indonesia: The World’s Dumping Ground for Waste?
Coordinating Minister for Economic Affairs Airlangga Hartarto indicated that while the B50 program isn’t cancelled outright, its implementation will depend on how crude oil and palm oil price dynamics evolve, as well as on continuing industry trials and infrastructure readiness.
Economic and Market Implications
The decision has already reverberated beyond Indonesia’s borders. Global palm oil prices saw downward pressure after the delay was announced, underlining how expected domestic demand for biofuel can tighten exportable supplies and influence international commodity markets.
To support the biodiesel mandate and maintain a subsidy framework, Indonesian authorities announced increases in palm oil export levies, raising the tariff on crude palm oil from 10 % to 12.5 %, with corresponding hikes on refined products. Such fiscal measures could influence Indonesian competitiveness and the global trade landscape.
Analysts caution that adjustments to levy rates and biodiesel policy may prompt buyers to look more toward other palm oil suppliers, such as Malaysia, depending on cost and availability. Saibumi
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Indonesia claims B40 biodiesel mix can boost CPO value, cut CO2 emissions by 38 million tons
Jakarta – Throughout 2025, the government noted that the implementation of B40 biodiesel was able to reduce emissions by tens of millions of tonnes of carbon while boosting the added value of crude palm oil (CPO) by tens of trillions of rupiah. According to the Ministry of Energy and Mineral Resources (MEMR), this mandatory policy not only strengthens efforts to reduce greenhouse gas emissions but also has a significant economic impact on the national palm oil sector.
On Thursday, 8 January, Minister of Energy and Mineral Resources Bahlil Lahadalia stated that the biodiesel programme, which uses a blend of 40 per cent palm-based biofuel and 60 per cent diesel, has become one of the main instruments for strengthening Indonesia’s energy security. One of the most noticeable impacts is the sharp decline in diesel imports compared to the previous year.
“If we compare, solar imports in 2024 will still be around 8 million tonnes. In 2025, that figure will be reduced to around 5 million tonnes,” said Bahlil during a press conference on the performance of the Ministry of Energy and Mineral Resources in 2025.
He explained that this achievement was supported by the realisation of domestic biodiesel utilisation exceeding the target. Data from the Ministry of Energy and Mineral Resources shows that biodiesel consumption from January to December 2025 reached 14.2 million kilolitres, exceeding the Key Performance Indicator target of 13.5 million kilolitres. This performance is equivalent to 105.2 per cent of the target set by the government.
According to Bahlil, this success provides a strong foundation for the government to take further steps. One of the major targets currently being prepared is the complete cessation of diesel imports starting in 2026. The government is also preparing to trial a higher blend of biodiesel, namely B50, which is planned to be completed in the first half of 2026 before a decision is made on its widespread implementation.
“If the B50 trial goes well and domestic processing capacity is ready, then solar imports will no longer be necessary,” he said.
In addition to reducing dependence on foreign energy supplies, the biodiesel policy also helps conserve foreign exchange reserves. Throughout 2025, the government recorded foreign exchange savings of Rp130.21 trillion. At the same time, this policy reduced carbon emissions by around 38.88 million tonnes of CO₂ equivalent.
Not only that, but the B40 programme also creates added economic value domestically. The processing of CPO into biodiesel throughout last year generated an additional economic value of around Rp20.43 trillion, which is considered to have strengthened the national palm oil industry chain.
The government’s optimism for achieving a solar import-free Indonesia by 2026 is also supported by the operation of the Balikpapan Refinery Development Master Plan (RDMP) project in East Kalimantan. The project is projected to significantly increase domestic solar production capacity.
“With the combination of B50 and the imminent operation of RDMP in East Kalimantan, national diesel fuel demand can be met domestically,” said Bahlil.
However, he acknowledged that there are still certain types of diesel fuel with high specifications, such as Solar CN51, which is needed for the heavy equipment industry, that currently still need to be met through limited imports. This is because domestic production capacity for this type of fuel is still in the development stage. Tanah Air
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PKH Task Force Receives Fines of IDR 5.27 Trillion from 48 Palm Oil and Mining Companies
JAKARTA - The Forest Area Regulation Task Force (Satgas PKH) has collected administrative fines from 48 palm oil plantation and mining sector companies with a total value of around IDR 5.27 trillion. The payment is part of enforcing rules on violations of forest area utilization.
Spokesperson for the PKH Barita Task Force, Barita Simanjuntak, said the payment of the fine showed corporate compliance with government policies in forest area management.
"We appreciate companies that have fulfilled their obligations to pay administrative fines to the state," Barita said at a press conference in Jakarta, Wednesday.
From the palm oil plantation sector, as many as 41 companies have paid administrative fines with a total value of around Rp4.76 trillion. Salim Group is recorded as the largest contributor with a payment of around Rp2.33 trillion. Followed by the Sampoerna Agro Group through PT Mutiara Bunda Jaya with Rp965 billion.
Furthermore, the Astra Agro Lestari Group paid Rp571.04 billion, Best Agro Group around Rp645.33 billion, Bumitama Gunajaya Agro Group Rp116.15 billion, and Surya Dumai Group Rp93.19 billion.
Meanwhile, from the mining sector, the PKH Task Force recorded the payment and commitment to pay administrative fines from seven companies with a total value of around Rp515 billion. The payment, among others, comes from PT Tonia Mitra Sejahtera for Rp500 billion and PT Mahakam Sumber Jaya worth Rp13.28 billion.
In addition, five other mining companies have expressed their readiness to pay administrative fines according to the schedule set with a value of around IDR 1.8 billion.
The PKH Task Force also noted the potential for additional fines, especially from the palm oil plantation sector. Of the 83 palm oil companies that were summoned, 73 companies have attended the call, including 41 companies that have made payments.
Of this amount, 13 companies expressed their readiness to pay administrative fines with a total value of around IDR 2.39 trillion. The payment process is currently running according to the agreed schedule.
As for the mining sector, the PKH Task Force has invited 32 companies, with 22 companies fulfilling the call. Of these, seven companies have received and agreed to pay administrative fines, while other companies are still filing objections or waiting for rescheduling.
Barita emphasized that forest area discipline not only includes the collection of administrative fines, but also the re-possession of forest areas and the recovery of state assets. The PKH Task Force is also preparing legal steps against corporations that do not show good faith in fulfilling their obligations in accordance with the provisions of laws and regulations.
Until now, the PKH Task Force has identified and secured large-scale land assets in the palm oil plantation and mining sectors. VOI
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Papua Lawmaker Rejects Prabowo's Palm Oil Plan, Military Projects
TEMPO.CO, Jakarta – Paul Finsen Mayor, a member of the Regional Representative Council (DPD) from Southwest Papua, expressed his disapproval of Indonesian President Prabowo Subianto's plan to encourage oil palm plantations in Papua. Finsen stated that his opposition represents the aspirations of the indigenous Papuan people.
He also asked Regional Representative Council (DPD) Speaker Sultan Bachtiar Najamudin to report the opposition to Prabowo and Minister of Energy and Mineral Resources Bahlil Lahadalia. The request was made during an interruption of the DPD plenary session on Wednesday, January 14, 2026.
"Leaders, the indigenous people of Papua reject the oil palm initiative in Papua. So, convey this to Mr. Prabowo and Bahlil, stop with this project because Papuans don't like it," Finsen said in the plenary meeting room at the DPR, DPD, and MPR complex in Jakarta on Wednesday.
In addition to palm oil, Finsen also expressed his objections to the establishment of the Territorial Development Infantry Battalion (Yonif TP) in Papua. He believes that the Indonesian Army headquarters, which focuses on improving food security, is not aligned with the needs of Papuans.
This is because Yonif TP has a special company that handles agriculture and animal husbandry. "Papuans need schools and hospitals, not army headquarters," he said.
Finsen also reminded that the Papuan Special Autonomy Law mandates improving access to education and healthcare, rather than food security.
After hearing Finsen's concerns, Regional Representative Council (DPD) Speaker Sultan stated that he had gathered all input from his members. The former deputy governor of Bengkulu is seeking a face-to-face meeting with Prabowo to follow up on the senators' concerns.
"We are currently seeking a meeting schedule, including with the President in a consultation meeting to convey the same point," said Sultan.
One month ago, Prabowo pushed for the planting of oil palms in Papua, which can produce an alternative fuel to hydrocarbon-based fuels. He delivered this directive while briefing six governors and 42 regents in the Papua region, along with his cabinet members and the Executive Committee for the Acceleration of Special Autonomy Development in Papua at the State Palace in Jakarta on Tuesday, December 16, 2025.
"We hope that oil palms will also be planted in Papua so that they can also produce fuel from palm oil," Prabowo said. Tempo
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India emerges as key market for Argentine vegetable oil exports
India has consolidated its position as the world’s leading importer of Argentine vegetable oils, according to information shared by the Argentine Oilseed Industry Chamber (CIARA) and the Center of Grain Exporters (CEC) on their social media channels.
India meets a large share of its domestic demand for vegetable oils through imports, which are used mainly for human consumption and basic industrial applications. This reliance on foreign supply reflects the pace of growth in domestic consumption, which continues to outstrip the country’s local production capacity.
Official statistics show that India imported more than 14 million tonnes of crude vegetable oils and related products in 2021, with a total value of around US$17.4 billion, placing the country among the most important global markets for the segment. Within this volume, crude soybean oil and crude sunflower oil accounted for a significant share, with major shipments originating from Argentina, Brazil, Russia and Ukraine.
For Argentina, the Indian market represents a strategic opportunity. CIARA-CEC notes that India’s sustained demand supports growth prospects for Argentine soybean and sunflower oil exports, two of the main byproducts of the country’s oilseed complex, in which Argentina holds a prominent position globally.
According to import data published by CIARA-CEC on the social media platform X, Argentina was India’s largest supplier of edible oils in 2025, shipping a total of 3.53 million tonnes between January and December. Crude soybean oil accounted for the bulk of the volume, at 2.88 million tonnes, followed by 0.65 million tonnes of crude sunflower oil.
While Argentina’s vegetable oil exports are largely shipped in bulk, a portion of these volumes is transported in containers, particularly products that undergo additional refining. The chart below shows Argentina’s monthly soybean oil shipments in containers, measured in TEUs. The data is sourced from Datamar.
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Policy uncertainty the biggest worry for MPOA in 2026
BY ROSLIN AZMY HASSAN Chief executive of the Malaysian Palm Oil Association (MPOA)
The Edge: After a year marked by uncertainty from tariffs and geopolitics, what are your expectations for 2026?
MPOA: Despite a tough external environment this year, we are heading into 2026 with cautious optimism. Most analysts at the MPOB International Palm Oil Congress and Exhibition (PIPOC) 2025, including CIMB, Fastmarkets and Glenauk, expect CPO prices to stay fairly stable next year, trading at RM4,000 to RM4,600 per tonne.
Dr Julian McGill of Glenauk Economics sees prices recovering to between RM4,300 and RM4,400 by the first quarter of 2026. Dr Sathia Varqa of Fastmarkets expects RM4,500 to RM4,600 on seasonal recovery.
A few positive factors going into 2026:
Overall, we expect a more balanced year, with firmer prices and better clarity on global policies.
What downside risks or competitive threats worry you most for 2026?
There are several:
1. Policy uncertainty – the biggest factor
AI and mechanisation are increasingly part of plantation operations. We are seeing:
The challenges:
Do you face challenges in hiring the right people? Are there plans to reduce reliance on foreign labour?
Yes, labour remains one of the biggest constraints, especially for harvesting. Even with improved recruitment flow, the sector is still heavily reliant on foreign labour.
This is why mechanisation and automation are critical. Growers are actively adopting:
If you could ask the government for one thing, what would it be?
A consistent long-term policy framework is essential, especially on labour, sustainability and mechanisation.
But if we could ask for one specific thing, it would be for the Windfall Profit Levy (WPL) to be channelled back to the industry as replanting support.
Malaysia urgently needs to ramp up replanting to between 200,000ha and 228,000 ha per year to clear the backlog of old trees. Replanting costs typically range from RM18,000 to RM25,000 per hectare, which remains prohibitive, particularly for mid-sized estates.
Incentives sought include:
A few other notable updates
MPOA members comprise individuals and corporate bodies involved in plantation tree crop agriculture, with at least 40ha. MPOA
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Malaysian Palm Oil Board to begin publishing UCO prices in Q1 2026
In Malaysia, the Malaysia Reserve newspaper reports that the Malaysian Palm Oil Board will begin an official reference price for used cooking oil during the first quarter of this year to help support fair trading practices and help small players especially escape price manipulation due to misinformation. Although palm oil is a key feedstock for biodiesel nationally, the country is putting effort into solidifying different waste feedstocks to supplement production for both biodiesel and palm-based chemical products. Biofuels Digest
Indonesia’s Biodiesel Shift: B50 Plan Put on Hold, Raising Questions for Global Palm Oil Markets
Jakarta, January 2026 — Indonesia has shelved plans to introduce a 50 % palm oil-based biodiesel blend (B50) this year, opting instead to retain its current 40 % biodiesel mandate (B40) amid ongoing technical and economic concerns.
The decision, made public this week by government officials, comes as Jakarta grapples with the practical challenges of scaling up its renewable fuel program — once touted as a major step toward energy self-sufficiency and a significant factor in global palm oil demand.
What Changed? From B50 to B40
Indonesia, the world’s largest producer and exporter of crude palm oil, had earlier targeted a mandatory B50 blend for 2026. Under that plan, diesel would contain equal parts conventional fossil fuel and biodiesel derived from palm oil — double the biofuel content currently mandated in B40.
However, officials say that technical feasibility and funding constraints — including the cost of subsidizing the more aggressive blend — made it impractical to roll out B50 as initially scheduled. Instead, the government confirmed that B40 will remain in place throughout 2026, with the B50 rollout still under study.
SEE ALSO Indonesia: The World’s Dumping Ground for Waste?
Coordinating Minister for Economic Affairs Airlangga Hartarto indicated that while the B50 program isn’t cancelled outright, its implementation will depend on how crude oil and palm oil price dynamics evolve, as well as on continuing industry trials and infrastructure readiness.
Economic and Market Implications
The decision has already reverberated beyond Indonesia’s borders. Global palm oil prices saw downward pressure after the delay was announced, underlining how expected domestic demand for biofuel can tighten exportable supplies and influence international commodity markets.
To support the biodiesel mandate and maintain a subsidy framework, Indonesian authorities announced increases in palm oil export levies, raising the tariff on crude palm oil from 10 % to 12.5 %, with corresponding hikes on refined products. Such fiscal measures could influence Indonesian competitiveness and the global trade landscape.
Analysts caution that adjustments to levy rates and biodiesel policy may prompt buyers to look more toward other palm oil suppliers, such as Malaysia, depending on cost and availability. Saibumi
--------
Indonesia claims B40 biodiesel mix can boost CPO value, cut CO2 emissions by 38 million tons
Jakarta – Throughout 2025, the government noted that the implementation of B40 biodiesel was able to reduce emissions by tens of millions of tonnes of carbon while boosting the added value of crude palm oil (CPO) by tens of trillions of rupiah. According to the Ministry of Energy and Mineral Resources (MEMR), this mandatory policy not only strengthens efforts to reduce greenhouse gas emissions but also has a significant economic impact on the national palm oil sector.
On Thursday, 8 January, Minister of Energy and Mineral Resources Bahlil Lahadalia stated that the biodiesel programme, which uses a blend of 40 per cent palm-based biofuel and 60 per cent diesel, has become one of the main instruments for strengthening Indonesia’s energy security. One of the most noticeable impacts is the sharp decline in diesel imports compared to the previous year.
“If we compare, solar imports in 2024 will still be around 8 million tonnes. In 2025, that figure will be reduced to around 5 million tonnes,” said Bahlil during a press conference on the performance of the Ministry of Energy and Mineral Resources in 2025.
He explained that this achievement was supported by the realisation of domestic biodiesel utilisation exceeding the target. Data from the Ministry of Energy and Mineral Resources shows that biodiesel consumption from January to December 2025 reached 14.2 million kilolitres, exceeding the Key Performance Indicator target of 13.5 million kilolitres. This performance is equivalent to 105.2 per cent of the target set by the government.
According to Bahlil, this success provides a strong foundation for the government to take further steps. One of the major targets currently being prepared is the complete cessation of diesel imports starting in 2026. The government is also preparing to trial a higher blend of biodiesel, namely B50, which is planned to be completed in the first half of 2026 before a decision is made on its widespread implementation.
“If the B50 trial goes well and domestic processing capacity is ready, then solar imports will no longer be necessary,” he said.
In addition to reducing dependence on foreign energy supplies, the biodiesel policy also helps conserve foreign exchange reserves. Throughout 2025, the government recorded foreign exchange savings of Rp130.21 trillion. At the same time, this policy reduced carbon emissions by around 38.88 million tonnes of CO₂ equivalent.
Not only that, but the B40 programme also creates added economic value domestically. The processing of CPO into biodiesel throughout last year generated an additional economic value of around Rp20.43 trillion, which is considered to have strengthened the national palm oil industry chain.
The government’s optimism for achieving a solar import-free Indonesia by 2026 is also supported by the operation of the Balikpapan Refinery Development Master Plan (RDMP) project in East Kalimantan. The project is projected to significantly increase domestic solar production capacity.
“With the combination of B50 and the imminent operation of RDMP in East Kalimantan, national diesel fuel demand can be met domestically,” said Bahlil.
However, he acknowledged that there are still certain types of diesel fuel with high specifications, such as Solar CN51, which is needed for the heavy equipment industry, that currently still need to be met through limited imports. This is because domestic production capacity for this type of fuel is still in the development stage. Tanah Air
--------
PKH Task Force Receives Fines of IDR 5.27 Trillion from 48 Palm Oil and Mining Companies
JAKARTA - The Forest Area Regulation Task Force (Satgas PKH) has collected administrative fines from 48 palm oil plantation and mining sector companies with a total value of around IDR 5.27 trillion. The payment is part of enforcing rules on violations of forest area utilization.
Spokesperson for the PKH Barita Task Force, Barita Simanjuntak, said the payment of the fine showed corporate compliance with government policies in forest area management.
"We appreciate companies that have fulfilled their obligations to pay administrative fines to the state," Barita said at a press conference in Jakarta, Wednesday.
From the palm oil plantation sector, as many as 41 companies have paid administrative fines with a total value of around Rp4.76 trillion. Salim Group is recorded as the largest contributor with a payment of around Rp2.33 trillion. Followed by the Sampoerna Agro Group through PT Mutiara Bunda Jaya with Rp965 billion.
Furthermore, the Astra Agro Lestari Group paid Rp571.04 billion, Best Agro Group around Rp645.33 billion, Bumitama Gunajaya Agro Group Rp116.15 billion, and Surya Dumai Group Rp93.19 billion.
Meanwhile, from the mining sector, the PKH Task Force recorded the payment and commitment to pay administrative fines from seven companies with a total value of around Rp515 billion. The payment, among others, comes from PT Tonia Mitra Sejahtera for Rp500 billion and PT Mahakam Sumber Jaya worth Rp13.28 billion.
In addition, five other mining companies have expressed their readiness to pay administrative fines according to the schedule set with a value of around IDR 1.8 billion.
The PKH Task Force also noted the potential for additional fines, especially from the palm oil plantation sector. Of the 83 palm oil companies that were summoned, 73 companies have attended the call, including 41 companies that have made payments.
Of this amount, 13 companies expressed their readiness to pay administrative fines with a total value of around IDR 2.39 trillion. The payment process is currently running according to the agreed schedule.
As for the mining sector, the PKH Task Force has invited 32 companies, with 22 companies fulfilling the call. Of these, seven companies have received and agreed to pay administrative fines, while other companies are still filing objections or waiting for rescheduling.
Barita emphasized that forest area discipline not only includes the collection of administrative fines, but also the re-possession of forest areas and the recovery of state assets. The PKH Task Force is also preparing legal steps against corporations that do not show good faith in fulfilling their obligations in accordance with the provisions of laws and regulations.
Until now, the PKH Task Force has identified and secured large-scale land assets in the palm oil plantation and mining sectors. VOI
--------
Papua Lawmaker Rejects Prabowo's Palm Oil Plan, Military Projects
TEMPO.CO, Jakarta – Paul Finsen Mayor, a member of the Regional Representative Council (DPD) from Southwest Papua, expressed his disapproval of Indonesian President Prabowo Subianto's plan to encourage oil palm plantations in Papua. Finsen stated that his opposition represents the aspirations of the indigenous Papuan people.
He also asked Regional Representative Council (DPD) Speaker Sultan Bachtiar Najamudin to report the opposition to Prabowo and Minister of Energy and Mineral Resources Bahlil Lahadalia. The request was made during an interruption of the DPD plenary session on Wednesday, January 14, 2026.
"Leaders, the indigenous people of Papua reject the oil palm initiative in Papua. So, convey this to Mr. Prabowo and Bahlil, stop with this project because Papuans don't like it," Finsen said in the plenary meeting room at the DPR, DPD, and MPR complex in Jakarta on Wednesday.
In addition to palm oil, Finsen also expressed his objections to the establishment of the Territorial Development Infantry Battalion (Yonif TP) in Papua. He believes that the Indonesian Army headquarters, which focuses on improving food security, is not aligned with the needs of Papuans.
This is because Yonif TP has a special company that handles agriculture and animal husbandry. "Papuans need schools and hospitals, not army headquarters," he said.
Finsen also reminded that the Papuan Special Autonomy Law mandates improving access to education and healthcare, rather than food security.
After hearing Finsen's concerns, Regional Representative Council (DPD) Speaker Sultan stated that he had gathered all input from his members. The former deputy governor of Bengkulu is seeking a face-to-face meeting with Prabowo to follow up on the senators' concerns.
"We are currently seeking a meeting schedule, including with the President in a consultation meeting to convey the same point," said Sultan.
One month ago, Prabowo pushed for the planting of oil palms in Papua, which can produce an alternative fuel to hydrocarbon-based fuels. He delivered this directive while briefing six governors and 42 regents in the Papua region, along with his cabinet members and the Executive Committee for the Acceleration of Special Autonomy Development in Papua at the State Palace in Jakarta on Tuesday, December 16, 2025.
"We hope that oil palms will also be planted in Papua so that they can also produce fuel from palm oil," Prabowo said. Tempo
--------
India emerges as key market for Argentine vegetable oil exports
India has consolidated its position as the world’s leading importer of Argentine vegetable oils, according to information shared by the Argentine Oilseed Industry Chamber (CIARA) and the Center of Grain Exporters (CEC) on their social media channels.
India meets a large share of its domestic demand for vegetable oils through imports, which are used mainly for human consumption and basic industrial applications. This reliance on foreign supply reflects the pace of growth in domestic consumption, which continues to outstrip the country’s local production capacity.
Official statistics show that India imported more than 14 million tonnes of crude vegetable oils and related products in 2021, with a total value of around US$17.4 billion, placing the country among the most important global markets for the segment. Within this volume, crude soybean oil and crude sunflower oil accounted for a significant share, with major shipments originating from Argentina, Brazil, Russia and Ukraine.
For Argentina, the Indian market represents a strategic opportunity. CIARA-CEC notes that India’s sustained demand supports growth prospects for Argentine soybean and sunflower oil exports, two of the main byproducts of the country’s oilseed complex, in which Argentina holds a prominent position globally.
According to import data published by CIARA-CEC on the social media platform X, Argentina was India’s largest supplier of edible oils in 2025, shipping a total of 3.53 million tonnes between January and December. Crude soybean oil accounted for the bulk of the volume, at 2.88 million tonnes, followed by 0.65 million tonnes of crude sunflower oil.
While Argentina’s vegetable oil exports are largely shipped in bulk, a portion of these volumes is transported in containers, particularly products that undergo additional refining. The chart below shows Argentina’s monthly soybean oil shipments in containers, measured in TEUs. The data is sourced from Datamar.
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Policy uncertainty the biggest worry for MPOA in 2026
BY ROSLIN AZMY HASSAN Chief executive of the Malaysian Palm Oil Association (MPOA)
The Edge: After a year marked by uncertainty from tariffs and geopolitics, what are your expectations for 2026?
MPOA: Despite a tough external environment this year, we are heading into 2026 with cautious optimism. Most analysts at the MPOB International Palm Oil Congress and Exhibition (PIPOC) 2025, including CIMB, Fastmarkets and Glenauk, expect CPO prices to stay fairly stable next year, trading at RM4,000 to RM4,600 per tonne.
Dr Julian McGill of Glenauk Economics sees prices recovering to between RM4,300 and RM4,400 by the first quarter of 2026. Dr Sathia Varqa of Fastmarkets expects RM4,500 to RM4,600 on seasonal recovery.
A few positive factors going into 2026:
- Global production growth is expected to be flat, held back by La Niña, ageing trees and high input costs, especially in Indonesia;
- Palm oil is regaining price competitiveness against soybean oil;
- Export demand tends to rebound quickly when palm becomes cheaper; and
- Indonesia’s biodiesel programme, even with uncertainties, continues to support demand structurally.
Overall, we expect a more balanced year, with firmer prices and better clarity on global policies.
What downside risks or competitive threats worry you most for 2026?
There are several:
1. Policy uncertainty – the biggest factor
- Indonesia’s B40/B50 rollout is still unclear, given insufficient capacity and funding;
- US-China trade tensions continue to influence soybean flows and vegetable oil prices; and
- The EUDR, while delayed, still carries operational challenges.
- La Niña may create uneven yields across the region.
- Land seizures, reclassification issues and slow replanting could put three million to 3.5 million tonnes of Indonesian supply at risk, which can cause volatility.
- China’s massive soybean crushing has made the country a soybean oil exporter, shifting global dynamics; and
- Any US restrictions on Canadian canola could flood global markets with displaced supply.
- Our replanting rate is only 1.5% versus the required 4%, with 650,000ha of old palms. This depresses yields and competitiveness. So, while demand is stable, supply, policy and weather remain key watchpoints for 2026.
AI and mechanisation are increasingly part of plantation operations. We are seeing:
- Drone-based crop monitoring;
- Digital estate systems;
- Precision agriculture tools;
- Early mechanised harvesting solutions; and
- Smallholder digitalisation through FELDA’s Smart Plantation Management Solutions (SPMS), RISE and e-Nota.
The challenges:
- Terrain and crop height make tech adaptation difficult;
- High upfront cost;
- Skills gap, where we need more trained operators and technicians; and
- Field execution is often the limiting factor, not technology.
Do you face challenges in hiring the right people? Are there plans to reduce reliance on foreign labour?
Yes, labour remains one of the biggest constraints, especially for harvesting. Even with improved recruitment flow, the sector is still heavily reliant on foreign labour.
This is why mechanisation and automation are critical. Growers are actively adopting:
- Mechanised collection tools;
- Assisted harvesting devices;
- AI and digital monitoring systems; and
- Drones for surveillance and fertiliser application.
If you could ask the government for one thing, what would it be?
A consistent long-term policy framework is essential, especially on labour, sustainability and mechanisation.
But if we could ask for one specific thing, it would be for the Windfall Profit Levy (WPL) to be channelled back to the industry as replanting support.
Malaysia urgently needs to ramp up replanting to between 200,000ha and 228,000 ha per year to clear the backlog of old trees. Replanting costs typically range from RM18,000 to RM25,000 per hectare, which remains prohibitive, particularly for mid-sized estates.
Incentives sought include:
- Direct replanting grants covering 50% of land clearing, planting materials and early maintenance costs;
- Soft loans or zero-interest financing with moratoriums during the three- to four-year immature phase for small and medium companies;
- Tax deductions or accelerated capital allowances for replanting and mechanisation investments;
- Labour-saving mechanisation support, including grants for harvesting, in-field transport and automation technologies; and
- Funding support for EUDR and MSPO (Malaysian Sustainable Palm Oil) compliance, including traceability systems, digital land mapping and sustainability certification costs.
- Raise yields through younger, higher-yielding palms.
- Reduce labour dependency via modern planting layouts and mechanisation.
- Strengthen Malaysia’s long-term competitiveness as an efficient palm oil producer.
- Improve EUDR and MSPO compliance, especially among smallholders.
A few other notable updates
- EUDR Delay: The EUDR has been delayed to end-2026/27 with simplified requirements. This avoids a major operational shock;
- Indonesia’s B50 Programme: Indonesia’s B50 programme begins road testing this month with early rollout likely restricted to the public sector;
- Indonesia Replanting: Indonesia’s replanting programme is far behind target, with only 23,000ha achieved this year, raising long-term supply questions;
- Production Trends: Indonesia produced around 43 million tonnes in the first nine months (up 11% year on year), but future growth will be constrained;
- Malaysia’s Position: Malaysia needs bold replanting action or we risk falling further behind our competitors; and
- Digital Transformation: The digital transformation of smallholder models such as FELDA is showing promising results in productivity and governance.
MPOA members comprise individuals and corporate bodies involved in plantation tree crop agriculture, with at least 40ha. MPOA
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Malaysian Palm Oil Board to begin publishing UCO prices in Q1 2026
In Malaysia, the Malaysia Reserve newspaper reports that the Malaysian Palm Oil Board will begin an official reference price for used cooking oil during the first quarter of this year to help support fair trading practices and help small players especially escape price manipulation due to misinformation. Although palm oil is a key feedstock for biodiesel nationally, the country is putting effort into solidifying different waste feedstocks to supplement production for both biodiesel and palm-based chemical products. Biofuels Digest
January 14, 2026
Nigeria bets on $2 billion fund to boost energy transition
Summary
LAGOS, Jan 13 (Reuters) - Nigeria is betting on green finance to drive its energy transition with the president unveiling plans for a $2 billion climate fund on Tuesday, saying oversubscribed green bonds were proof of investor appetite.
Speaking at the Abu Dhabi Sustainability Week summit, President Bola Tinubu said Nigeria’s Climate Investment Platform aimed to mobilise $500 million for climate-resilient infrastructure, while the National Climate Change Fund is targeting a $2 billion capitalisation to back projects that cut emissions and boost resilience.
Tinubu also announced that Nigeria and the United Arab Emirates had signed a Comprehensive Economic Partnership Agreement (CEPA) that aims to boost trade and investment across sectors including renewable energy, aviation, logistics, agriculture, digital trade, and climate-smart infrastructure.
Nigeria faces major environmental and climate policy challenges including reducing gas flaring and methane emissions, as it works towards its Energy Transition Plan, which targets net-zero emissions by 2060 while delivering universal energy access.
Nigeria’s green bond programme has drawn strong investor interest. A 50 billion naira ($38 million) sovereign green bond issued in 2025 attracted 91 billion naira in subscriptions, while Lagos State’s green bond was oversubscribed by nearly 98%, the president said. Reuters
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After years of progress, Indonesia risks ‘tragedy’ of a deforestation spike
In December, Indonesia’s forestry minister, Raja Juli Antoni, indicated the Southeast Asian nation had lost more forest during the first nine months of 2025 than the annual totals for any of the first three years of this decade.
Gross deforestation in Indonesia in 2025 was on track to at least match 2024’s tally, which reflected the most extensive losses since 2019, Antoni told a parliamentary committee in December.
As Indonesia pushes ahead with its Merauke Food Estate project, which involves clearing at least 2 million hectares (4.9 million acres) of forest in South Papua province, worries are mounting that Indonesia’s commodity exports may suffer if big markets like the EU force importers, including food-processing companies, to prove they are not buying palm oil and other products that have resulted from clearing rainforest.
“The tragedy of this project [Merauke Food Estate] is that it is undermining Indonesia’s recent success in the battle to halt global deforestation,” Amanda Hurowitz, forest commodities lead at nonprofit Mighty Earth, told Mongabay.
Deforestation accelerates
Indonesia’s deforestation slowed substantially during former President Joko Widodo’s second five-year term in office in part because of a moratorium on clearing forest for oil palm plantations following widespread fires a decade ago. Prior to that, for years, Indonesia was one of the world’s biggest deforestation hotspots as corporate-run plantations proliferated in Sumatra and Borneo.
Gross deforestation, not including replanted trees, covered an area of 166,500 hectares (411,000 acres) during the first nine months of 2025, Antoni told a parliamentary committee in December.
New area impacted by deforestation shrank to 119,100 hectares (294,000 acres) in 2020, roughly a quarter the level from the previous year when the Widodo administration issued a moratorium on new permits to clear primary forest. During the four years before 2024, annual increase in gross deforestation didn’t exceed 146,000 hectares (360,000 acres).
But last year’s official tally jumped by more than half to 216,000 (534,000 acres) — an understatement, according to NGO Auriga Nusantara, which puts the total at more than 260,000 hectares (642,000 acres).
Carbon credits fizzle
A reacceleration in the rate of Indonesia’s deforestation risks drawing attention to the country’s spotty climate record. At No. 6, Indonesia ranks among the top greenhouse gas emitters after China, the U.S., India, the EU and Russia, according to the EU’s 2025 Emissions Database for Global Atmospheric Research.
At a planned $1 billion auction of carbon credits at the COP30 Summit in Brazil, Indonesia managed to sell fewer than 2.8 million carbon credits out of 90 million on offer. Carbon credits based on fewer than half of its 40 energy and conservation projects found takers, the country’s climate envoy Hashim Djojohadikusumo said. Mongabay
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Malaysia to introduce official used cooking oil reference price in early 2026
[KUALA LUMPUR] Malaysia will introduce an official reference price for used cooking oil in the first quarter of this year to prevent price manipulation in the sector, its commodities minister said on Tuesday, as it seeks to better regulate the commodity.
Plantation and Commodities Minister Noraini Ahmad told an industry conference that the new benchmark will provide price guidance and allow the fair trading of used cooking oil, as well as protect industry players from fraud.
Malaysia, the world’s second largest palm oil producer, has been boosting efforts to crack down on fraud in the used cooking oil industry.
Noraini also called for the palm oil sector to step up efforts to increase the use of technology and mechanisation, in order to reduce its dependence on manual labour.
Malaysia’s palm oil exports in 2025 were valued at RM112 billion (S$35.5 billion), up from RM109 billion in 2024, Malaysian Palm Oil Board chairman Mohamad Helmy Othman Basha told the conference earlier. REUTERS/ Business Times
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Climate activist shareholder group pushes BP, Shell on plans for declining oil demand
LONDON, Jan 14 (Reuters) - Climate activist shareholder group Follow This and more than 20 other investors have filed resolutions calling on BP (BP.L), opens new tab and Shell (SHEL.L), opens new tab to disclose how they will create value if global demand for oil and gas declines, the group said on Wednesday.
The resolutions reflect a strategic shift on the part of the Dutch activist group, after it said in April that a lack of investor appetite had forced it to suspend its nearly decade-long campaign of seeking from major oil and gas producers to emissions cuts.
Follow This started filing climate resolutions at shareholder meetings in 2016 and attracted peak shareholder votes in subsequent years of 80% at Phillips 66 (PSX.N), opens new tab, 60% at Chevron (CVX.N), opens new tab, around a third at Exxon (XOM.N), opens new tab and Shell (SHEL.L), opens new tab and a fifth at BP (BP.L), opens new tab.
The group will concentrate on demanding that BP and Shell disclose longer-term strategies under scenarios of declining oil and gas demand, the group said.
Along with other producers, the two companies have cut back their renewable energy pledges to focus investment on oil and gas projects.
The resolutions request BP and Shell to publish reports covering at least 10 years, detailing capital expenditure, production plans, and free cash flow projections under declining demand scenarios, including from the International Energy Agency. Reuters
Nigeria bets on $2 billion fund to boost energy transition
Summary
- Nigeria-UAE sign CEPA to boost trade in renewable energy
- Tinubu seeks $25–$30 billion annually in climate finance
- President calls for global finance shift for developing nations
LAGOS, Jan 13 (Reuters) - Nigeria is betting on green finance to drive its energy transition with the president unveiling plans for a $2 billion climate fund on Tuesday, saying oversubscribed green bonds were proof of investor appetite.
Speaking at the Abu Dhabi Sustainability Week summit, President Bola Tinubu said Nigeria’s Climate Investment Platform aimed to mobilise $500 million for climate-resilient infrastructure, while the National Climate Change Fund is targeting a $2 billion capitalisation to back projects that cut emissions and boost resilience.
Tinubu also announced that Nigeria and the United Arab Emirates had signed a Comprehensive Economic Partnership Agreement (CEPA) that aims to boost trade and investment across sectors including renewable energy, aviation, logistics, agriculture, digital trade, and climate-smart infrastructure.
Nigeria faces major environmental and climate policy challenges including reducing gas flaring and methane emissions, as it works towards its Energy Transition Plan, which targets net-zero emissions by 2060 while delivering universal energy access.
Nigeria’s green bond programme has drawn strong investor interest. A 50 billion naira ($38 million) sovereign green bond issued in 2025 attracted 91 billion naira in subscriptions, while Lagos State’s green bond was oversubscribed by nearly 98%, the president said. Reuters
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After years of progress, Indonesia risks ‘tragedy’ of a deforestation spike
- Deforestation is accelerating, underscoring Indonesia’s reputation as a big greenhouse gas emitter and potentially inviting more scrutiny of its commodity exports.
- Gross deforestation in Indonesia in 2025 was on track to at least match 2024’s tally, which reflected the most extensive losses since 2019, Indonesia’s forestry minister, Raja Juli Antoni, told a parliamentary committee in December.
- Indonesia’s Merauke Food Estate project involves clearing at least 2 million hectares of forest, and worries are mounting that commodity exports may suffer if big markets like the EU force importers to prove they are not buying palm oil and other products that have resulted from clearing rainforest.
- A reacceleration in the rate of Indonesia’s deforestation risks is also drawing attention to the country’s spotty climate record: At No. 6, Indonesia ranks among the top greenhouse gas emitters after China, the U.S., India, the EU and Russia.
In December, Indonesia’s forestry minister, Raja Juli Antoni, indicated the Southeast Asian nation had lost more forest during the first nine months of 2025 than the annual totals for any of the first three years of this decade.
Gross deforestation in Indonesia in 2025 was on track to at least match 2024’s tally, which reflected the most extensive losses since 2019, Antoni told a parliamentary committee in December.
As Indonesia pushes ahead with its Merauke Food Estate project, which involves clearing at least 2 million hectares (4.9 million acres) of forest in South Papua province, worries are mounting that Indonesia’s commodity exports may suffer if big markets like the EU force importers, including food-processing companies, to prove they are not buying palm oil and other products that have resulted from clearing rainforest.
“The tragedy of this project [Merauke Food Estate] is that it is undermining Indonesia’s recent success in the battle to halt global deforestation,” Amanda Hurowitz, forest commodities lead at nonprofit Mighty Earth, told Mongabay.
Deforestation accelerates
Indonesia’s deforestation slowed substantially during former President Joko Widodo’s second five-year term in office in part because of a moratorium on clearing forest for oil palm plantations following widespread fires a decade ago. Prior to that, for years, Indonesia was one of the world’s biggest deforestation hotspots as corporate-run plantations proliferated in Sumatra and Borneo.
Gross deforestation, not including replanted trees, covered an area of 166,500 hectares (411,000 acres) during the first nine months of 2025, Antoni told a parliamentary committee in December.
New area impacted by deforestation shrank to 119,100 hectares (294,000 acres) in 2020, roughly a quarter the level from the previous year when the Widodo administration issued a moratorium on new permits to clear primary forest. During the four years before 2024, annual increase in gross deforestation didn’t exceed 146,000 hectares (360,000 acres).
But last year’s official tally jumped by more than half to 216,000 (534,000 acres) — an understatement, according to NGO Auriga Nusantara, which puts the total at more than 260,000 hectares (642,000 acres).
Carbon credits fizzle
A reacceleration in the rate of Indonesia’s deforestation risks drawing attention to the country’s spotty climate record. At No. 6, Indonesia ranks among the top greenhouse gas emitters after China, the U.S., India, the EU and Russia, according to the EU’s 2025 Emissions Database for Global Atmospheric Research.
At a planned $1 billion auction of carbon credits at the COP30 Summit in Brazil, Indonesia managed to sell fewer than 2.8 million carbon credits out of 90 million on offer. Carbon credits based on fewer than half of its 40 energy and conservation projects found takers, the country’s climate envoy Hashim Djojohadikusumo said. Mongabay
--------
Malaysia to introduce official used cooking oil reference price in early 2026
[KUALA LUMPUR] Malaysia will introduce an official reference price for used cooking oil in the first quarter of this year to prevent price manipulation in the sector, its commodities minister said on Tuesday, as it seeks to better regulate the commodity.
Plantation and Commodities Minister Noraini Ahmad told an industry conference that the new benchmark will provide price guidance and allow the fair trading of used cooking oil, as well as protect industry players from fraud.
Malaysia, the world’s second largest palm oil producer, has been boosting efforts to crack down on fraud in the used cooking oil industry.
Noraini also called for the palm oil sector to step up efforts to increase the use of technology and mechanisation, in order to reduce its dependence on manual labour.
Malaysia’s palm oil exports in 2025 were valued at RM112 billion (S$35.5 billion), up from RM109 billion in 2024, Malaysian Palm Oil Board chairman Mohamad Helmy Othman Basha told the conference earlier. REUTERS/ Business Times
--------
Climate activist shareholder group pushes BP, Shell on plans for declining oil demand
- Follow This shifts strategy to focus on value if hydrocarbon demand declines
- Investors that back assets worth around 1.5 trillion euros back the resolutions
- Investor support for emissions cuts reached around 20% at BP and 80% at Phillips 66
LONDON, Jan 14 (Reuters) - Climate activist shareholder group Follow This and more than 20 other investors have filed resolutions calling on BP (BP.L), opens new tab and Shell (SHEL.L), opens new tab to disclose how they will create value if global demand for oil and gas declines, the group said on Wednesday.
The resolutions reflect a strategic shift on the part of the Dutch activist group, after it said in April that a lack of investor appetite had forced it to suspend its nearly decade-long campaign of seeking from major oil and gas producers to emissions cuts.
Follow This started filing climate resolutions at shareholder meetings in 2016 and attracted peak shareholder votes in subsequent years of 80% at Phillips 66 (PSX.N), opens new tab, 60% at Chevron (CVX.N), opens new tab, around a third at Exxon (XOM.N), opens new tab and Shell (SHEL.L), opens new tab and a fifth at BP (BP.L), opens new tab.
The group will concentrate on demanding that BP and Shell disclose longer-term strategies under scenarios of declining oil and gas demand, the group said.
Along with other producers, the two companies have cut back their renewable energy pledges to focus investment on oil and gas projects.
The resolutions request BP and Shell to publish reports covering at least 10 years, detailing capital expenditure, production plans, and free cash flow projections under declining demand scenarios, including from the International Energy Agency. Reuters
January 13, 2026
Indonesia inaugurates country's largest oil refinery project in Balikpapan
JAKARTA, Jan. 12 (Xinhua) -- Indonesian President Prabowo Subianto officially inaugurated the Refinery Development Master Plan (RDMP) at Refinery Unit V in Balikpapan, East Kalimantan province, on Monday.
The Balikpapan RDMP is part of the Indonesian government's efforts to strengthen national energy security and support Indonesia's goal of energy self-sufficiency.
During the ceremony, Prabowo said the project is expected to reduce Indonesia's dependence on imported fuel, while emphasizing that Indonesia has abundant energy resources, including palm oil for biodiesel, geothermal energy, solar power, and hydropower. He said these resources should be managed properly so the country can achieve energy independence.
"We must not depend on energy from outside. We want to be independent, and we are capable," Prabowo said.
Minister of Energy and Mineral Resources Bahlil Lahadalia said that the Balikpapan RDMP is the biggest refinery project in the country, enabling the refinery to process up to 360,000 barrels of oil per day.
The project is expected to save up to 68 trillion Indonesian rupiah annually in fuel imports and make a significant contribution to the national economy. It will also improve fuel quality to Euro V standards and increase the production of valuable petroleum products. Xinhua
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Indonesia official says launch of B50 biodiesel depends on crude oil, palm oil prices
JAKARTA, Jan 13 (Reuters) - The launch of Indonesia's B50 biodiesel mandate will depend on the price gap between crude oil and crude palm oil, a senior official said on Tuesday.
Indonesia, the world's largest producer of palm oil, previously said it would start its B50 mandate, which requires a 50-50 blend of palm-based fuel and diesel, in the second half of 2026. The current mandate calls for biodiesel that is 40% palm-based.
The country subsidises its biodiesel programme using proceeds from palm oil export levies. The size of the subsidy depends on the difference between crude oil and crude palm oil prices.
"This year, the guidance from the president is to maintain B40," said Airlangga Hartarto, the coordinating minister for economic affairs. "For B50, reviews are being continuously conducted and we must monitor the difference between crude oil and crude palm oil prices."
"We are preparing for (implementation) in the second semester, however under current price conditions, the president's directive is (to maintain) B40, but be ready for B50," he added. Reuters
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Germany enacts national law transposing the EU Renewable Energy Directive into domestic legislation
The European Red III initiative has been forcing European nations to reconsider their commitments to clean energy on the continent. The initiative is aimed at increasing renewable energy developments and removing barriers for member states to promote the production and use of clean energy. Germany’s cabinet has recently enacted a law to transpose the EU Renewable Energy Directive into domestic legislation.
Germany’s progressive nature has been on full display recently
In December of last year, the German cabinet approved proposed legislation to implement the EU RED III directive into law, paving the way for other European nations to do the same. The aim of the RED III directive is to foster a more welcoming environment for renewable energy production across the EU member states.
By implementing the directive into law, Germany can now reduce the greenhouse gas (GHG) reduction quota and do away with double-counting of advanced fuels from this year onwards. The new bill, passed by the cabinet, follows a leak in November that will see the overall greenhouse gas reduction quota level rise to 59pc by 2040.
It’s worth mentioning that aviation and marine fuels will be exempt from the new quotas. The new law implemented by the German cabinet will end the eligibility of palm oil products for compliance with the GHG quota, but the exclusion will not come into effect until 2027, leaving the door open for this year to be a transitional one for the European energy market.
The new law provides a pathway for Germany to increase renewable energy production
The aim of the new law is to provide an accelerated framework and path towards decarbonizing the German energy market. Renewable energy has encompassed the entire world and has been advancing at a steady pace as nations aim to meet self-imposed clean energy and emission reduction targets.
The next step is for the law to pass through the bureaucratic process in Germany
The law can only be enforced once it has been published in the Federal Law Gazette. Before that happens, the new law needs to be submitted to Germany’s lower and upper parliaments for debate. While the lower house approval is not a requirement, the upper parliament may make changes to the law if deemed necessary. Energies Media
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MPOB To Introduce Used Cooking Oil Reference Price In 1Q 2026
KUALA LUMPUR, Jan 13 (Bernama) -- The Malaysia Palm Oil Board (MPOB) will introduce an official used cooking oil (UCO) reference price in the first quarter of 2026, said Plantation and Commodities Minister Datuk Seri Dr Noraini Ahmad.
She said the benchmark will provide a clear price guidance, support fair trading and protect small players from price manipulation and fraud, while playing an important step towards a more orderly and sustainable UCO market.
“UCO plays an important role in this transition (turning waste into valuable resources), particularly for downstream uses such as biofuels and palm-based chemical products.
“MPOB continues to strengthen governance, clear tracking and market oversight to ensure that UCO is managed in a safe and orderly manner,” she said in her opening speech before launching the Palm Oil Economic Review And Outlook (R&O) Seminar 2026.
Meanwhile, Noraini said the average crude palm oil price increased by 2.7 per cent to RM4,292 per tonne in 2025 from RM4,179 per tonne in 2024.
She said export revenue for palm oil and palm-based products is expected to exceed RM100 billion in 2025, with crude palm oil production approaching 20 million tonnes.
“This is a strong achievement. From the government's view, our future competitiveness depends on three key areas: higher productivity, stronger sustainability assurances, and faster adoption of innovation,” she added.
On prospects, Noraini opined that Malaysia’s palm oil outlook remains positive, with the priority being to strengthen productivity, sustainability and adaptability together.
She said Malaysia must focus on quality, sustainability and traceability rather than volume alone; therefore, the government will continue to strengthen its assurance system to keep Malaysian palm oil trusted and competitive.
“I am very confident that the Malaysian oil palm industry has a strong and resilient future and growth must go hand in hand with sustainability, inclusiveness and innovation.
“This requires close cooperation between the government, industrial players, researchers and (also) the smallholders,” she said.
The R&O seminar, organised by MPOB with the theme “Securing the Future of Palm Oil in a Changing Global Economy”, brings together more than 400 industry experts and academicians to discuss the 2025 market performance, the potential for 2026 as well as the strategies and direction for the Malaysian palm oil indfustry.
The event also saw the launch of the booklet titled “Small Bites, Big Impact – The Red Palm Oil Biscuit Story” which highlights the findings from the red palm oil supplementation study conducted by MPOB in collaboration with the University of Malaya. Bernama
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Indonesia inaugurates country's largest oil refinery project in Balikpapan
JAKARTA, Jan. 12 (Xinhua) -- Indonesian President Prabowo Subianto officially inaugurated the Refinery Development Master Plan (RDMP) at Refinery Unit V in Balikpapan, East Kalimantan province, on Monday.
The Balikpapan RDMP is part of the Indonesian government's efforts to strengthen national energy security and support Indonesia's goal of energy self-sufficiency.
During the ceremony, Prabowo said the project is expected to reduce Indonesia's dependence on imported fuel, while emphasizing that Indonesia has abundant energy resources, including palm oil for biodiesel, geothermal energy, solar power, and hydropower. He said these resources should be managed properly so the country can achieve energy independence.
"We must not depend on energy from outside. We want to be independent, and we are capable," Prabowo said.
Minister of Energy and Mineral Resources Bahlil Lahadalia said that the Balikpapan RDMP is the biggest refinery project in the country, enabling the refinery to process up to 360,000 barrels of oil per day.
The project is expected to save up to 68 trillion Indonesian rupiah annually in fuel imports and make a significant contribution to the national economy. It will also improve fuel quality to Euro V standards and increase the production of valuable petroleum products. Xinhua
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Indonesia official says launch of B50 biodiesel depends on crude oil, palm oil prices
JAKARTA, Jan 13 (Reuters) - The launch of Indonesia's B50 biodiesel mandate will depend on the price gap between crude oil and crude palm oil, a senior official said on Tuesday.
Indonesia, the world's largest producer of palm oil, previously said it would start its B50 mandate, which requires a 50-50 blend of palm-based fuel and diesel, in the second half of 2026. The current mandate calls for biodiesel that is 40% palm-based.
The country subsidises its biodiesel programme using proceeds from palm oil export levies. The size of the subsidy depends on the difference between crude oil and crude palm oil prices.
"This year, the guidance from the president is to maintain B40," said Airlangga Hartarto, the coordinating minister for economic affairs. "For B50, reviews are being continuously conducted and we must monitor the difference between crude oil and crude palm oil prices."
"We are preparing for (implementation) in the second semester, however under current price conditions, the president's directive is (to maintain) B40, but be ready for B50," he added. Reuters
--------
Germany enacts national law transposing the EU Renewable Energy Directive into domestic legislation
The European Red III initiative has been forcing European nations to reconsider their commitments to clean energy on the continent. The initiative is aimed at increasing renewable energy developments and removing barriers for member states to promote the production and use of clean energy. Germany’s cabinet has recently enacted a law to transpose the EU Renewable Energy Directive into domestic legislation.
Germany’s progressive nature has been on full display recently
In December of last year, the German cabinet approved proposed legislation to implement the EU RED III directive into law, paving the way for other European nations to do the same. The aim of the RED III directive is to foster a more welcoming environment for renewable energy production across the EU member states.
By implementing the directive into law, Germany can now reduce the greenhouse gas (GHG) reduction quota and do away with double-counting of advanced fuels from this year onwards. The new bill, passed by the cabinet, follows a leak in November that will see the overall greenhouse gas reduction quota level rise to 59pc by 2040.
It’s worth mentioning that aviation and marine fuels will be exempt from the new quotas. The new law implemented by the German cabinet will end the eligibility of palm oil products for compliance with the GHG quota, but the exclusion will not come into effect until 2027, leaving the door open for this year to be a transitional one for the European energy market.
The new law provides a pathway for Germany to increase renewable energy production
The aim of the new law is to provide an accelerated framework and path towards decarbonizing the German energy market. Renewable energy has encompassed the entire world and has been advancing at a steady pace as nations aim to meet self-imposed clean energy and emission reduction targets.
The next step is for the law to pass through the bureaucratic process in Germany
The law can only be enforced once it has been published in the Federal Law Gazette. Before that happens, the new law needs to be submitted to Germany’s lower and upper parliaments for debate. While the lower house approval is not a requirement, the upper parliament may make changes to the law if deemed necessary. Energies Media
--------
MPOB To Introduce Used Cooking Oil Reference Price In 1Q 2026
KUALA LUMPUR, Jan 13 (Bernama) -- The Malaysia Palm Oil Board (MPOB) will introduce an official used cooking oil (UCO) reference price in the first quarter of 2026, said Plantation and Commodities Minister Datuk Seri Dr Noraini Ahmad.
She said the benchmark will provide a clear price guidance, support fair trading and protect small players from price manipulation and fraud, while playing an important step towards a more orderly and sustainable UCO market.
“UCO plays an important role in this transition (turning waste into valuable resources), particularly for downstream uses such as biofuels and palm-based chemical products.
“MPOB continues to strengthen governance, clear tracking and market oversight to ensure that UCO is managed in a safe and orderly manner,” she said in her opening speech before launching the Palm Oil Economic Review And Outlook (R&O) Seminar 2026.
Meanwhile, Noraini said the average crude palm oil price increased by 2.7 per cent to RM4,292 per tonne in 2025 from RM4,179 per tonne in 2024.
She said export revenue for palm oil and palm-based products is expected to exceed RM100 billion in 2025, with crude palm oil production approaching 20 million tonnes.
“This is a strong achievement. From the government's view, our future competitiveness depends on three key areas: higher productivity, stronger sustainability assurances, and faster adoption of innovation,” she added.
On prospects, Noraini opined that Malaysia’s palm oil outlook remains positive, with the priority being to strengthen productivity, sustainability and adaptability together.
She said Malaysia must focus on quality, sustainability and traceability rather than volume alone; therefore, the government will continue to strengthen its assurance system to keep Malaysian palm oil trusted and competitive.
“I am very confident that the Malaysian oil palm industry has a strong and resilient future and growth must go hand in hand with sustainability, inclusiveness and innovation.
“This requires close cooperation between the government, industrial players, researchers and (also) the smallholders,” she said.
The R&O seminar, organised by MPOB with the theme “Securing the Future of Palm Oil in a Changing Global Economy”, brings together more than 400 industry experts and academicians to discuss the 2025 market performance, the potential for 2026 as well as the strategies and direction for the Malaysian palm oil indfustry.
The event also saw the launch of the booklet titled “Small Bites, Big Impact – The Red Palm Oil Biscuit Story” which highlights the findings from the red palm oil supplementation study conducted by MPOB in collaboration with the University of Malaya. Bernama
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January 12, 2026
Indonesia, Pakistan Push Trade Pact Upgrade to CEPA by 2027
TEMPO.CO, Jakarta – The Indonesian Government and the Government of Pakistan have agreed to accelerate the Indonesia-Pakistan Preferential Trade Agreement (IP-PTA) into a Comprehensive Economic Partnership Agreement (CEPA).
Deputy Trade Minister, Dyah Roro Esti, stated that Indonesia and Pakistan continue to strengthen their strategic partnership in trade and the economy. "We are pushing for the acceleration of the expansion of IP-PTA into CEPA, which is targeted to be realized by 2027," she said during her bilateral meeting with Pakistan's Minister of Trade, Jam Kamal Khan, on the sidelines of the 8th Pakistan Edible Oil Conference (PEOC) in Karachi, Pakistan on Friday, January 9, 2026, as quoted from Antara.
In the meeting, Roro stated that Indonesia also proposed for technical negotiations to begin in early 2026, utilizing the progress of the Indonesia-Pakistan Trade in Goods Agreement (IP-TIGA) as a foundation. "The expansion of cooperation towards CEPA will strengthen the integration of trade in goods, services, and investments in a more comprehensive and sustainable manner."
The bilateral meeting follows the visit of President Prabowo Subianto to Pakistan in December 2025, which resulted in several strategic agreements to deepen and expand the trade cooperation between the two countries. Tempo
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B50 Biodiesel Won’t Affect Palm Oil Exports, Indonesia Tells Pakistan
Jakarta. Indonesia has told Pakistan that it could rest assured that Jakarta’s upcoming B50 biodiesel mandate would not affect the palm oil exports bound for Islamabad and elsewhere.
Indonesia has implemented a mandatory 40% palm oil-based biodiesel blend, known as the B40. The world’s largest palm oil supplier is now planning to impose the B50 later this year, which will see the government raising the mandatory blend to 50%. Deputy Trade Minister Dyah Roro Esti Widya Putri said the greater palm oil content would not affect the shipments to international partners, including Pakistan.
“All biodiesel policies, such as the B50 program, will not disrupt palm oil export,” Dyah Roro told a recent conference with Pakistani businesses in Karachi.
Pakistan is the third-largest foreign consumer of Indonesian palm oil, just behind China and India. Indonesia’s exports to Pakistan neared $3.5 billion in January-November 2025. Almost $2.8 billion of Indonesian exports were shipments of goods under the category of “animal fats/vegetable oil”, Trade Ministry data revealed. Jakarta Globe
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Indonesia’s B50 Biodiesel Mandate Seen Strengthening Malaysia’s Palm Oil Competitiveness
KUALA LUMPUR, Jan 12 (Bernama) -- Indonesia’s move to implement its B50 biodiesel mandate is expected to enhance Malaysia’s competitiveness in the global palm oil market, says an economist.
Universiti Kebangsaan Malaysia economics associate professor Dr Norlin Khalid said the policy could position Malaysia as a preferred alternative for exporters and buyers through favourable pricing, reliable supply, and consistent product quality.
Norlin said the policy shift would make Indonesian palm oil less competitive due to higher export levies and tighter export availability, making Malaysia an alternative and reliable source of supply.
“As the world’s largest palm oil producer, Indonesia’s decision to raise export levies to finance its biodiesel mandate is expected to influence global palm oil supply dynamics, as a significant share of palm oil production is being absorbed by the domestic biodiesel programme, thereby reducing export availability.
“In this context, higher export costs and stronger domestic absorption of palm oil in Indonesia can create opportunities for Malaysia’s palm oil industry, particularly in price-sensitive and supply security-driven markets such as India, China, Africa, and the Middle East,” she told Bernama.
On Jan 8, 2025, news media reported that Indonesia was likely to increase its palm oil export levy to support the country's biodiesel mandate. News reports said the country has mandated a mandatory 40 per cent palm-based biodiesel blend, known as B40, the highest blending rate in the world, and seeks to increase the blend to 50 per cent (B50) later this year, with a ministerial-level meeting anticipated to be held this week to discuss the matter.According to Norlin, the policy shift is expected to contribute to firmer prices and reinforce Malaysia’s exposure to Indonesia-driven supply shocks, providing a supportive price environment, as tighter global supply conditions tend to strengthen crude palm oil (CPO) price levels.
“Even if Malaysia’s palm oil production growth remains stable, the industry benefits from positive price transmission effects. In particular, Indonesia’s biodiesel policy, which drives higher domestic demand, tends to support higher benchmark prices, with the impact reflected in Bursa Malaysia Derivatives (BMD) CPO futures,” she said.
Overall, Norlin said Malaysia is well-positioned to strengthen its role in global palm oil supply by meeting additional demand in key export markets, while contributing to overall market stability. Bernama
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Productivity to Decide Malaysia’s Palm Oil Competitiveness, MPOC Urges Realistic Yield Targets
PALMOILMAGAZINE, KUALA LUMPUR – The future competitiveness and sustainability of Malaysia’s palm oil industry will increasingly hinge on its ability to raise productivity. Stagnant production growth is beginning to constrain supply—an issue industry players say has been looming for decades.
Malaysian Palm Oil Council (MPOC) Chairman Carl Bek-Nielsen said the industry has spent too long talking about higher yields without delivering meaningful progress. In some cases, productivity has even declined. For him, long-term sustainability will not be achieved by chasing overly ambitious numbers, but by setting realistic and achievable targets.
“If productivity is low and commodity prices fall, that is a recipe for disaster. But with high productivity, the industry has a cushion when prices weaken,” Bek-Nielsen said, as quoted by Palmoilmagazine.com from The Edge Markets, Monday (5 January 2026).
The interview marked Bek-Nielsen’s first public discussion since assuming the role of MPOC chairman in May 2023. A Danish national and Malaysian permanent resident, he has spent more than 30 years in the palm oil sector. He began his career at United Plantations Bhd in 1993 as a cadet planter and has served as the group’s CEO since January 2013.
Bek-Nielsen described Malaysia’s national ambition of lifting yields to six to seven tons of crude palm oil (CPO) per hectare as unrealistic, given the dominance of ageing trees and the slow pace of replanting, particularly among smallholders. In 2024, Malaysia’s average CPO productivity stood at just 3.28 tons per hectare.
Instead, he proposed a gradual approach with a more attainable goal of around 4.5 tons per hectare by 2035. Such an improvement, he said, would already represent a major leap for the industry and significantly strengthen Malaysia’s position in addressing the European Union Deforestation Regulation (EUDR), as higher yields reduce the need for land expansion and directly address deforestation concerns. Palm Oil Magazine
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West Papua stresses Indigenous approval for palm oil expansion
The West Papua provincial government has stressed to Jakarta any release of forest areas for palm oil plantation expansion must obtain approval from Indigenous communities, who under new protections hold customary land rights.
It comes after a recent Indonesian court decision allowed Papuan Indigenous peoples to cultivate its forests at will for its own benefit.
The policy aims to protect the rights of Indigenous people while also conserving forests throughout traditional Papuan territory.
Head of the West Papua Forestry Office, Jimmy Walter Susanto — an Indonesian figure — said the aspirations of Indigenous people is a top priority in policymaking related to forest utilisation.
"West Papua has a standard operating procedure," he said, according to Antara, an Indonesian-based news agency.
"Every plan to release forest areas must include a letter of approval from Indigenous communities."
Mr Susanto emphasised the provincial government must prioritise Indigenous participation in all forestry decisions to prevent social conflict and ensure investment projects "respect community rights and forest sustainability".
This principle is applied to prevent social conflicts and ensure investments are in line with the protection of Indigenous rights and conservation of forestry areas. NIT
Indonesia, Pakistan Push Trade Pact Upgrade to CEPA by 2027
TEMPO.CO, Jakarta – The Indonesian Government and the Government of Pakistan have agreed to accelerate the Indonesia-Pakistan Preferential Trade Agreement (IP-PTA) into a Comprehensive Economic Partnership Agreement (CEPA).
Deputy Trade Minister, Dyah Roro Esti, stated that Indonesia and Pakistan continue to strengthen their strategic partnership in trade and the economy. "We are pushing for the acceleration of the expansion of IP-PTA into CEPA, which is targeted to be realized by 2027," she said during her bilateral meeting with Pakistan's Minister of Trade, Jam Kamal Khan, on the sidelines of the 8th Pakistan Edible Oil Conference (PEOC) in Karachi, Pakistan on Friday, January 9, 2026, as quoted from Antara.
In the meeting, Roro stated that Indonesia also proposed for technical negotiations to begin in early 2026, utilizing the progress of the Indonesia-Pakistan Trade in Goods Agreement (IP-TIGA) as a foundation. "The expansion of cooperation towards CEPA will strengthen the integration of trade in goods, services, and investments in a more comprehensive and sustainable manner."
The bilateral meeting follows the visit of President Prabowo Subianto to Pakistan in December 2025, which resulted in several strategic agreements to deepen and expand the trade cooperation between the two countries. Tempo
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B50 Biodiesel Won’t Affect Palm Oil Exports, Indonesia Tells Pakistan
Jakarta. Indonesia has told Pakistan that it could rest assured that Jakarta’s upcoming B50 biodiesel mandate would not affect the palm oil exports bound for Islamabad and elsewhere.
Indonesia has implemented a mandatory 40% palm oil-based biodiesel blend, known as the B40. The world’s largest palm oil supplier is now planning to impose the B50 later this year, which will see the government raising the mandatory blend to 50%. Deputy Trade Minister Dyah Roro Esti Widya Putri said the greater palm oil content would not affect the shipments to international partners, including Pakistan.
“All biodiesel policies, such as the B50 program, will not disrupt palm oil export,” Dyah Roro told a recent conference with Pakistani businesses in Karachi.
Pakistan is the third-largest foreign consumer of Indonesian palm oil, just behind China and India. Indonesia’s exports to Pakistan neared $3.5 billion in January-November 2025. Almost $2.8 billion of Indonesian exports were shipments of goods under the category of “animal fats/vegetable oil”, Trade Ministry data revealed. Jakarta Globe
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Indonesia’s B50 Biodiesel Mandate Seen Strengthening Malaysia’s Palm Oil Competitiveness
KUALA LUMPUR, Jan 12 (Bernama) -- Indonesia’s move to implement its B50 biodiesel mandate is expected to enhance Malaysia’s competitiveness in the global palm oil market, says an economist.
Universiti Kebangsaan Malaysia economics associate professor Dr Norlin Khalid said the policy could position Malaysia as a preferred alternative for exporters and buyers through favourable pricing, reliable supply, and consistent product quality.
Norlin said the policy shift would make Indonesian palm oil less competitive due to higher export levies and tighter export availability, making Malaysia an alternative and reliable source of supply.
“As the world’s largest palm oil producer, Indonesia’s decision to raise export levies to finance its biodiesel mandate is expected to influence global palm oil supply dynamics, as a significant share of palm oil production is being absorbed by the domestic biodiesel programme, thereby reducing export availability.
“In this context, higher export costs and stronger domestic absorption of palm oil in Indonesia can create opportunities for Malaysia’s palm oil industry, particularly in price-sensitive and supply security-driven markets such as India, China, Africa, and the Middle East,” she told Bernama.
On Jan 8, 2025, news media reported that Indonesia was likely to increase its palm oil export levy to support the country's biodiesel mandate. News reports said the country has mandated a mandatory 40 per cent palm-based biodiesel blend, known as B40, the highest blending rate in the world, and seeks to increase the blend to 50 per cent (B50) later this year, with a ministerial-level meeting anticipated to be held this week to discuss the matter.According to Norlin, the policy shift is expected to contribute to firmer prices and reinforce Malaysia’s exposure to Indonesia-driven supply shocks, providing a supportive price environment, as tighter global supply conditions tend to strengthen crude palm oil (CPO) price levels.
“Even if Malaysia’s palm oil production growth remains stable, the industry benefits from positive price transmission effects. In particular, Indonesia’s biodiesel policy, which drives higher domestic demand, tends to support higher benchmark prices, with the impact reflected in Bursa Malaysia Derivatives (BMD) CPO futures,” she said.
Overall, Norlin said Malaysia is well-positioned to strengthen its role in global palm oil supply by meeting additional demand in key export markets, while contributing to overall market stability. Bernama
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Productivity to Decide Malaysia’s Palm Oil Competitiveness, MPOC Urges Realistic Yield Targets
PALMOILMAGAZINE, KUALA LUMPUR – The future competitiveness and sustainability of Malaysia’s palm oil industry will increasingly hinge on its ability to raise productivity. Stagnant production growth is beginning to constrain supply—an issue industry players say has been looming for decades.
Malaysian Palm Oil Council (MPOC) Chairman Carl Bek-Nielsen said the industry has spent too long talking about higher yields without delivering meaningful progress. In some cases, productivity has even declined. For him, long-term sustainability will not be achieved by chasing overly ambitious numbers, but by setting realistic and achievable targets.
“If productivity is low and commodity prices fall, that is a recipe for disaster. But with high productivity, the industry has a cushion when prices weaken,” Bek-Nielsen said, as quoted by Palmoilmagazine.com from The Edge Markets, Monday (5 January 2026).
The interview marked Bek-Nielsen’s first public discussion since assuming the role of MPOC chairman in May 2023. A Danish national and Malaysian permanent resident, he has spent more than 30 years in the palm oil sector. He began his career at United Plantations Bhd in 1993 as a cadet planter and has served as the group’s CEO since January 2013.
Bek-Nielsen described Malaysia’s national ambition of lifting yields to six to seven tons of crude palm oil (CPO) per hectare as unrealistic, given the dominance of ageing trees and the slow pace of replanting, particularly among smallholders. In 2024, Malaysia’s average CPO productivity stood at just 3.28 tons per hectare.
Instead, he proposed a gradual approach with a more attainable goal of around 4.5 tons per hectare by 2035. Such an improvement, he said, would already represent a major leap for the industry and significantly strengthen Malaysia’s position in addressing the European Union Deforestation Regulation (EUDR), as higher yields reduce the need for land expansion and directly address deforestation concerns. Palm Oil Magazine
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West Papua stresses Indigenous approval for palm oil expansion
The West Papua provincial government has stressed to Jakarta any release of forest areas for palm oil plantation expansion must obtain approval from Indigenous communities, who under new protections hold customary land rights.
It comes after a recent Indonesian court decision allowed Papuan Indigenous peoples to cultivate its forests at will for its own benefit.
The policy aims to protect the rights of Indigenous people while also conserving forests throughout traditional Papuan territory.
Head of the West Papua Forestry Office, Jimmy Walter Susanto — an Indonesian figure — said the aspirations of Indigenous people is a top priority in policymaking related to forest utilisation.
"West Papua has a standard operating procedure," he said, according to Antara, an Indonesian-based news agency.
"Every plan to release forest areas must include a letter of approval from Indigenous communities."
Mr Susanto emphasised the provincial government must prioritise Indigenous participation in all forestry decisions to prevent social conflict and ensure investment projects "respect community rights and forest sustainability".
This principle is applied to prevent social conflicts and ensure investments are in line with the protection of Indigenous rights and conservation of forestry areas. NIT
January 10, 2026
Indonesia Hosts US Chief Agricultural Negotiator Julie Callahan Ahead of Deal Signing
Jakarta. Senior minister Airlangga Hartarto revealed Thursday night that he had just hosted US chief agricultural negotiator Julie Callahan in his Jakarta office, just a few weeks before the scheduled signing of the bilateral trade deal.
In a social media post, Airlangga revealed that the meeting had zeroed in on the tariffs in bilateral agricultural trade. Airlangga had just returned from Washington about two weeks ago, during which he met Callahan’s boss Jamieson Greer. The latest developments marked a win for Indonesian palm oil as the agricultural commodity could enter the US market tariff-free. However, other products, including manufactured goods, are still subject to a 19% import tax.
“We affirmed Indonesia’s commitment to push for a fair, balanced, and mutually beneficial trade. We seek more competitive market access for Indonesia’s leading agricultural products,” Airlangga said, commenting on his talks with Callahan.
This ranges from sustainable palm oil, cacao, coffee, spices, to value-added agroindustry products, according to Airlangga.
Jakarta hopes that its partnership with Washington extends beyond tariffs and also aims to enhance standards, sustainability, and global supply chain integration. “This way, the Indonesian agricultural sector can be more competitive and bring tangible benefits for both farmers and businesses,” Airlangga said.
President Prabowo Subianto is set to head to Washington by the end of this month to sign the trade agreement. Both governments will soon meet to check on the final document before the signing.
US President Donald Trump launched the capricious tariff policies in April, even initially threatening a 32% import tax on Indonesian goods before slashing them to 19% after months of negotiations. Indonesia has pledged to import $4.5 billion worth of agricultural products, including soybeans, wheat, and cotton, among others. In November, the Trump administration rolled back its reciprocal tariffs on a wide range of agricultural goods, including cocoa, coffee, and spices. Jakarta Globe
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Pakistan Seen as Strategic Partner in Indonesia’s Palm Oil Diplomacy
KBRN, Jakarta: Indonesia is strengthening its position as a global leader in the palm oil market by deepening ties with Pakistan, a country regarded not only as a major consumer but also as a strategic trade partner.
his commitment was underscored during a high-level meeting between Indonesia’s Ambassador to Pakistan, Chandra W. Sukotjo, and the Secretary-General of the Council of Palm Oil Producing Countries (CPOPC), Izzana Salleh, at the Indonesian Consulate General in Karachi on Thursday, January 8, 2026.
The meeting aligned government diplomacy with the vision of palm oil–producing nations, aiming to safeguard Indonesia’s economic interests in Pakistan. The visit coincided with the Pakistan Edible Oil Conference (PEOC), the region’s most prominent vegetable oil industry forum.
Ambassador Chandra emphasized that Pakistan’s reliance on Indonesian palm oil makes it more than just a market.
“Synergy between CPOPC and Indonesian missions abroad is crucial in addressing global challenges and countering negative narratives about palm oil. We must ensure international partners receive balanced, data-driven, and transparent information about Indonesia’s economic contributions and sustainability commitments,” he said, as quoted on the official website of the Indonesian Ministry of Foreign Affairs.
Echoing this, Consul General Mudzakir, who accompanied Ambassador Chandra at the meeting, reaffirmed the consulate’s readiness to serve as a bridge for industry stakeholders.
“We are committed to facilitating constructive dialogue with government, industry associations, and key importers in Pakistan. Our focus is to maintain Indonesia’s position as a trusted supplier for Pakistan’s food security in cooking oil and related industries,” he noted. RRI
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Governor Lucky Aiyedatiwa of Ondo State inaugurates 5,000-litre palm oil production factory in Ondo
Governor Lucky Aiyedatiwa of Ondo State, on Friday, reaffirmed his administration’s commitment to providing an enabling environment for small and medium-scale enterprises (SMEs) to thrive.
Aiyedatiwa stated this while inaugurating a fully integrated palm oil and palm kernel production factory established by Lo Choches Nigeria Limited in Akure, the state capital.
Represented by his deputy, Dr Olayide Adelami, described the project as a significant boost to the state’s industrial growth and economic diversification drive.
“This factory will do more than produce palm oil and palm kernel. It will create jobs for our youths, stimulate ancillary businesses, support local farmers, reduce dependence on external supplies and contribute meaningfully to our Internally Generated Revenue,” the governor said.
Aiyedatiwa also stressed that sustainable business growth thrives in a secure environment, noting that his administration has strengthened the state’s security architecture and deepened community policing to protect lives, property and investments.
He commended the management of Lo Choches Nigeria Limited for their confidence in Ondo State and for prioritising the engagement of local skills in the factory’s operations.
In his remarks, the Chief Executive Officer of the company, Lateef Audu, said the investment was driven by his passion for agriculture and belief in a production-based economy as a pathway to national development. Tribune OnlineNG
Indonesia Hosts US Chief Agricultural Negotiator Julie Callahan Ahead of Deal Signing
Jakarta. Senior minister Airlangga Hartarto revealed Thursday night that he had just hosted US chief agricultural negotiator Julie Callahan in his Jakarta office, just a few weeks before the scheduled signing of the bilateral trade deal.
In a social media post, Airlangga revealed that the meeting had zeroed in on the tariffs in bilateral agricultural trade. Airlangga had just returned from Washington about two weeks ago, during which he met Callahan’s boss Jamieson Greer. The latest developments marked a win for Indonesian palm oil as the agricultural commodity could enter the US market tariff-free. However, other products, including manufactured goods, are still subject to a 19% import tax.
“We affirmed Indonesia’s commitment to push for a fair, balanced, and mutually beneficial trade. We seek more competitive market access for Indonesia’s leading agricultural products,” Airlangga said, commenting on his talks with Callahan.
This ranges from sustainable palm oil, cacao, coffee, spices, to value-added agroindustry products, according to Airlangga.
Jakarta hopes that its partnership with Washington extends beyond tariffs and also aims to enhance standards, sustainability, and global supply chain integration. “This way, the Indonesian agricultural sector can be more competitive and bring tangible benefits for both farmers and businesses,” Airlangga said.
President Prabowo Subianto is set to head to Washington by the end of this month to sign the trade agreement. Both governments will soon meet to check on the final document before the signing.
US President Donald Trump launched the capricious tariff policies in April, even initially threatening a 32% import tax on Indonesian goods before slashing them to 19% after months of negotiations. Indonesia has pledged to import $4.5 billion worth of agricultural products, including soybeans, wheat, and cotton, among others. In November, the Trump administration rolled back its reciprocal tariffs on a wide range of agricultural goods, including cocoa, coffee, and spices. Jakarta Globe
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Pakistan Seen as Strategic Partner in Indonesia’s Palm Oil Diplomacy
KBRN, Jakarta: Indonesia is strengthening its position as a global leader in the palm oil market by deepening ties with Pakistan, a country regarded not only as a major consumer but also as a strategic trade partner.
his commitment was underscored during a high-level meeting between Indonesia’s Ambassador to Pakistan, Chandra W. Sukotjo, and the Secretary-General of the Council of Palm Oil Producing Countries (CPOPC), Izzana Salleh, at the Indonesian Consulate General in Karachi on Thursday, January 8, 2026.
The meeting aligned government diplomacy with the vision of palm oil–producing nations, aiming to safeguard Indonesia’s economic interests in Pakistan. The visit coincided with the Pakistan Edible Oil Conference (PEOC), the region’s most prominent vegetable oil industry forum.
Ambassador Chandra emphasized that Pakistan’s reliance on Indonesian palm oil makes it more than just a market.
“Synergy between CPOPC and Indonesian missions abroad is crucial in addressing global challenges and countering negative narratives about palm oil. We must ensure international partners receive balanced, data-driven, and transparent information about Indonesia’s economic contributions and sustainability commitments,” he said, as quoted on the official website of the Indonesian Ministry of Foreign Affairs.
Echoing this, Consul General Mudzakir, who accompanied Ambassador Chandra at the meeting, reaffirmed the consulate’s readiness to serve as a bridge for industry stakeholders.
“We are committed to facilitating constructive dialogue with government, industry associations, and key importers in Pakistan. Our focus is to maintain Indonesia’s position as a trusted supplier for Pakistan’s food security in cooking oil and related industries,” he noted. RRI
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Governor Lucky Aiyedatiwa of Ondo State inaugurates 5,000-litre palm oil production factory in Ondo
Governor Lucky Aiyedatiwa of Ondo State, on Friday, reaffirmed his administration’s commitment to providing an enabling environment for small and medium-scale enterprises (SMEs) to thrive.
Aiyedatiwa stated this while inaugurating a fully integrated palm oil and palm kernel production factory established by Lo Choches Nigeria Limited in Akure, the state capital.
Represented by his deputy, Dr Olayide Adelami, described the project as a significant boost to the state’s industrial growth and economic diversification drive.
“This factory will do more than produce palm oil and palm kernel. It will create jobs for our youths, stimulate ancillary businesses, support local farmers, reduce dependence on external supplies and contribute meaningfully to our Internally Generated Revenue,” the governor said.
Aiyedatiwa also stressed that sustainable business growth thrives in a secure environment, noting that his administration has strengthened the state’s security architecture and deepened community policing to protect lives, property and investments.
He commended the management of Lo Choches Nigeria Limited for their confidence in Ondo State and for prioritising the engagement of local skills in the factory’s operations.
In his remarks, the Chief Executive Officer of the company, Lateef Audu, said the investment was driven by his passion for agriculture and belief in a production-based economy as a pathway to national development. Tribune OnlineNG
January 09, 2026
Stagnant Production, B50 May Cut Indonesia’s Palm Exports In 2026
JAKARTA – Indonesia’s export of crude palm oil (CPO) is projected to continue under pressures in 2026. The Indonesian Palm Oil Association (GAPKI) said that that stagnant production, the increase of domestic consumption, and the implementation plan of mandatory biodiesel 50 percent (B50), are potential to limit the volume of national palm oil exports.¹
Being the world’s largest producer and exporter of palm oil, Indonesia is facing structural challenges amid rising global demand. Such condition is seen potential to pose a risk of weakening CPO export performance and triggering price pressures in the domestic market.
Global Palm Production Still Stagnant
GAPKI Chairman Eddy Martono stated that palm oil production from the world’s two major producing countries, Indonesia and Malaysia, has shown a tendency to stagnate during the last few years. But in the meantime, global demand for vegetable oils has been continually increasing.¹
Eddy said that the imbalance between supply and demand will become a major challenge for the palm oil industry in 2026. Production stagnation occurs amidst growing demand for food and energy, both domestically and globally.
CPO Export 2025 Up, supported by competitive price
Despite facing supply constraints, Indonesia’s CPO exports had been continually showing positive performance throughout 2025. Based on GAPKI data, as of October 2025 the CPO export volume reached 27.69 million tons, which was higher than 24.84 million tons during the same period of the previous year.²
The export increase was primarily supported by more competitive prices of palm oil compared to other vegetable oils. Since April 2025, palm oil prices have been recorded below those of sunflower and soybean oils.¹
This contrasts with 2024, when palm oil prices briefly exceeded those of rival vegetable oils, resulting in a decline in exports.
Stagnant production potential to push up price and inflation
GAPKI has projected that stagnant production of palm oil is potential to continue until 2026. With limited supply and increasing demand, palm oil prices are expected to rebound.³
Eddy Martono emphasized that Indonesia is not only the largest palm oil producer in the world, but also the largest consumer. This condition is considered potential to raise inflationary pressures, particularly in the sectors of food and energy.³
Domestic consumption up, export availability decreases
The rise of domestic palm oil consumption is another factor that will pressure exports. GAPKI recorded that domestic palm oil consumption reached 20.68 million tons during period of January–October 2025, which increased from 19.64 million tons during the same period at the previous year.²
This consumption increase was largely driven by the energy sector through the government’s mandatory biodiesel program. With stagnant production, the increase of domestic consumption had directly reduced the availability of CPO supply for exports.
Mandatory B50 potential to reduce CPO export in 2026
The government’s plan to implement the B50 program will likely stand as a potential factor to suppress the Indonesian CPO exports in 2026. According to Eddy, under the situation of limited supply, increasing CPO absorption for domestic needs will reduce export volumes.¹
“It’s impossible that only domestic supply will be reduced,” said Eddy.¹
GAPKI estimates that Indonesian CPO export in 2026 is potential to decline or at least stagnate compared to that in 2025.
POPSI: Mandatory B50 potential to pressure palm smallholders
On the other hand, the Association of Indonesian Palm Oil Smallholders (POPSI) has highlighted the impact of the mandatory B50 policy on the oil palm smallholders. POPSI Chairman Mansuetus Darto believes that reliance on the Oil Palm Plantation Fund Management Board (BPDPKS) for funding of the B50 program is potential to reduce funding allocated for the smallholders.⁴
According to Darto, BPDPKS funds should be used for replanting the smallholders’ oil palm plantations, increasing productivity, and strengthening sustainable development of smallholders. However, the increase of need for biodiesel funding is feared to marginalize those programs.⁴
RI’s Palm industry facing more complex challenges in 2026
With a combination of stagnant production, rising global demand, steadily rising domestic consumption, and an increasingly aggressive biodiesel program, the Indonesian palm oil industry is expected to face increasingly complex challenges in 2026.
Industry players believe that future palm oil policies need to be designed in a more balanced manner. In addition to supporting national energy security, such policies are also expected to maintain the competitiveness of CPO exports, price stability, foreign exchange earnings, and the welfare of oil palm smallholders. (*) GAPKI
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Indonesia mulls palm oil export levy hike to support biodiesel mandate
JAKARTA (Jan 8): Indonesia will likely increase its palm oil export levy to support the country's biodiesel mandate, energy ministry official Eniya Listiani Dewi told reporters on Thursday, citing tightening funds.
Indonesia, the largest palm oil producer, has implemented a mandatory 40% palm-based biodiesel blend, known as B40, the highest blending rate in the world. It seeks to increase the blend to 50% later this year.
Indonesia subsidises its biodiesel programme using proceeds from palm oil export levies, which are currently set at 10% of its monthly reference price for crude palm oil (CPO), with the levy on more refined products ranging between 4.75% and 9.5%.
"Whether it is B40 or B50, it has to be raised, according to an economic affairs ministry study," Eniya told reporters, adding that the cash reserves managed by the country's plantation fund were dwindling.
A meeting to discuss the levy hike will be held next week, she added.
Indonesia consumed 14.2 million kilolitres of palm-based biodiesel in 2025, a 7.6% increase compared to the previous year, energy ministry data showed on Thursday.
A road test for B50, which typically takes six months, has started in December, the energy minister said.
The energy ministry has allocated 15.65 million kilolitres of palm-based biodiesel for this year's blending mandate. The Edge
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AGO to Seize 4–5 Million Hectares of Illegal Palm Oil Plantation Land in 2026: President Prabowo
Inp.polri.go.id - Karawang. President Prabowo Subianto announced that the Attorney General's Office (AGO) will seize an additional 4 to 5 million hectares of problematic palm oil plantations in 2026, as part of the government's crackdown on illegal land control and corruption.
"We have already confiscated four million hectares of palm oil plantations that violate the law, and in 2026 we will seize another four to five million hectares," he said during a national harvest event in Karawang, West Java, on Wednesday (7/1/2026), as quoted by antarnews.com.
The President said the seizures are aimed at restoring state authority over illegally occupied forest areas and safeguarding public assets. He added that the government has also taken action against hundreds of illegal mining operations, saving the state hundreds of trillions of rupiah.
He added that illegal land and mining practices have persisted for years due to corruption and weak enforcement. He stressed that law enforcement agencies must act firmly and with integrity to ensure public funds fully benefit the people. POLRI
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Church, activists oppose palm oil expansion in Indonesia’s Papua
The move will cause far higher damages to environment and tribal people than economic benefits, critics say
A Catholic bishop has joined rights activists and tribal leaders to oppose a government plan to expand palm oil plantations in Indonesia’s Papua region, terming the move a threat to environment and indigenous communities.
In a statement on Jan. 8, Augustinian Bishop Bernardus Baru of Timika said expansion of oil plantations will have higher tolls on environment and forest-dependent local communities than so-called positive impacts claimed by the government of President Prabowo Subianto.
"Therefore, stop clearing forests. If you want the world to end quickly, go ahead. It won't be long before the end of the world if the government persists with its plan," Baru said in the statement.
He lamented that the world is becoming “increasingly greedy” and it wants to “destroy everything.”
“Humans should only need what they need," the prelate added.
The government plan was disclosed in a statement from the President last month that stated, "Oil palms should be planted in Papua so that we can produce fuel from palm oil."
The president claimed that within five years, all regions of Papua will become self-sufficient in food and energy from palm oil, thus saving national funds currently used for fuel subsidies.
Bishop Baru pointed to the recent devastating flood and landslide in Sumatra Island that claimed more than a thousand lives and blamed environmental destruction for aggravating the climate crisis. UCA NEWS
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Feedstock production for biofuels buffers supply to safeguard global nutrition
Crop plants were grown on just over 1.2 billion hectares worldwide in 2024. These include grain, oilseeds, protein, sugar and fibre plants, as well as fruits, vegetables, and nuts.
The largest share was used directly or indirectly, via livestock feed, for human nutrition.
The cultivation of feedstocks for biofuel production accounted for only about 7% of the cultivated land.
Most biofuels are produced in regions with a structural feedstock surplus, specifically, sugar, maize, palm oil and soybean oil.
In the absence of this way of processing, considerable volumes would have to be placed on the world market, which, in turn, would have a negative impact on producer prices globally. In other words, processing these feedstocks into biofuels contributes to reducing surpluses as well as generating additional value added.
According to Agrarmarkt Informations-Gesellschaft, at the same time the use of biofuels reduces the need for imports of crude oil or fossil fuel in many countries.
From the perspective of the Union zur Förderung von Oel- und Proteinpflanzen (UFOP), another effect of biofuel production is that it also yields high-quality protein feed, which is in high demand, and glycerin for the chemical industry.
These volumes and their quality influence commodity prices and, therefore, also have a bearing on the expansion or reduction of cultivation areas, particularly in the case of soybean.
UFOP has stated that biofuels are not a factor driving commodity prices. The corresponding feedstock can be redirected to food use at any time as and when needed. For example, at the beginning of the Russian attack on Ukraine rapeseed oil replaced previously imported sunflower seed oil.
If arable farming were to be extensified for political reasons – an aim the EU Commission is pursuing with the reduction strategy for fertilisers and plant protection products under the Green Deal – this option of "buffering" food demand would no longer be available.
UFOP has pointed out that the cultivation area would need to be expanded to close this demand gap. Biofuels News
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Palm Acid Oil Emerges as a Strategic Commodity as Europe Accelerates Renewable Energy Shift
PALMOILMAGAZINE, Kuala Lumpur — Palm-based downstream products are increasingly strengthening their strategic role in the global market. One product drawing growing attention is Palm Acid Oil (PAO), which has evolved from a traditional soap raw material into a key feedstock for renewable energy, oleochemicals, and animal feed industries.
As reported by Palmoilmagazine.com, citing an article by Hajar Shamsudin of the Malaysian Palm Oil Council (MPOC) on Sunday (January 4, 2026), PAO is a by-product generated from the alkaline refining of palm oil. Its high free fatty acid (FFA) content makes it highly suitable for a wide range of industrial applications.
Technically, PAO is a fatty acid fraction obtained through distillation from palm oil mill effluent (POME) and chemically refined palm oil. It consists of neutral oil, FFA levels exceeding 50 percent, and low moisture content of around 2–3 percent. These characteristics make PAO particularly well suited for biodiesel production, animal feed, and soap manufacturing.
Although its FFA content is slightly lower than that of Palm Fatty Acid Distillate (PFAD), PAO shares similar chemical properties. This flexibility positions PAO as an efficient and sustainable alternative within the global supply chain, especially as the clean energy transition accelerates worldwide.
Rapid Global Market Expansion
In value terms, the global PAO market was estimated at US$820 million in 2025 and is projected to grow at a compound annual growth rate (CAGR) of 8.5 percent through 2034, potentially reaching around US$1.72 billion. This expansion is being driven primarily by surging demand for biodiesel feedstock, supported by renewable energy policies and carbon emission reduction targets across major economies.
Beyond bioenergy, demand for PAO in oleochemicals and animal feed continues to rise, in line with growing global consumption of soaps, detergents, and livestock nutrition products. Its cost efficiency, broad usability, and compatibility with green policies are expected to keep PAO a strategic commodity over the next decade.
From Biodiesel to Cosmetics
In the biodiesel sector, PAO serves as an important feedstock due to its high FFA content, which is ideal for transesterification processes. The strongest demand comes from regions with biofuel blending mandates, notably Malaysia, Indonesia, and the European Union.
Within the oleochemical industry, PAO is processed into fatty acids and intermediate materials for cosmetic and chemical manufacturing, including glycerine and esters. Meanwhile, in the soap and detergent sector, the lauric and palmitic acid content of PAO enhances cleansing performance and soap hardness, making it a preferred raw material for large-scale production.
Sweden and Italy Emerge as Distinct EU Markets
Within the EU-27, Sweden and Italy have emerged as notable PAO markets. In the first nine months of 2025, Malaysia exported 64,151 tons of PAO worth 237 million Malaysian ringgit, or approximately €49 million, to the two countries.
Sweden recorded the largest volume, importing more than 53,000 tons between January and September 2025. This is considered unusual, given Sweden’s relatively small population of about 10.5 million, and even exceeded its imports of several more commonly traded palm-based products.
Italy, meanwhile, began importing PAO in 2025 after recording zero imports in 2024, opening new opportunities for Malaysian exporters in the European market. Palm Oil Magazine
Stagnant Production, B50 May Cut Indonesia’s Palm Exports In 2026
JAKARTA – Indonesia’s export of crude palm oil (CPO) is projected to continue under pressures in 2026. The Indonesian Palm Oil Association (GAPKI) said that that stagnant production, the increase of domestic consumption, and the implementation plan of mandatory biodiesel 50 percent (B50), are potential to limit the volume of national palm oil exports.¹
Being the world’s largest producer and exporter of palm oil, Indonesia is facing structural challenges amid rising global demand. Such condition is seen potential to pose a risk of weakening CPO export performance and triggering price pressures in the domestic market.
Global Palm Production Still Stagnant
GAPKI Chairman Eddy Martono stated that palm oil production from the world’s two major producing countries, Indonesia and Malaysia, has shown a tendency to stagnate during the last few years. But in the meantime, global demand for vegetable oils has been continually increasing.¹
Eddy said that the imbalance between supply and demand will become a major challenge for the palm oil industry in 2026. Production stagnation occurs amidst growing demand for food and energy, both domestically and globally.
CPO Export 2025 Up, supported by competitive price
Despite facing supply constraints, Indonesia’s CPO exports had been continually showing positive performance throughout 2025. Based on GAPKI data, as of October 2025 the CPO export volume reached 27.69 million tons, which was higher than 24.84 million tons during the same period of the previous year.²
The export increase was primarily supported by more competitive prices of palm oil compared to other vegetable oils. Since April 2025, palm oil prices have been recorded below those of sunflower and soybean oils.¹
This contrasts with 2024, when palm oil prices briefly exceeded those of rival vegetable oils, resulting in a decline in exports.
Stagnant production potential to push up price and inflation
GAPKI has projected that stagnant production of palm oil is potential to continue until 2026. With limited supply and increasing demand, palm oil prices are expected to rebound.³
Eddy Martono emphasized that Indonesia is not only the largest palm oil producer in the world, but also the largest consumer. This condition is considered potential to raise inflationary pressures, particularly in the sectors of food and energy.³
Domestic consumption up, export availability decreases
The rise of domestic palm oil consumption is another factor that will pressure exports. GAPKI recorded that domestic palm oil consumption reached 20.68 million tons during period of January–October 2025, which increased from 19.64 million tons during the same period at the previous year.²
This consumption increase was largely driven by the energy sector through the government’s mandatory biodiesel program. With stagnant production, the increase of domestic consumption had directly reduced the availability of CPO supply for exports.
Mandatory B50 potential to reduce CPO export in 2026
The government’s plan to implement the B50 program will likely stand as a potential factor to suppress the Indonesian CPO exports in 2026. According to Eddy, under the situation of limited supply, increasing CPO absorption for domestic needs will reduce export volumes.¹
“It’s impossible that only domestic supply will be reduced,” said Eddy.¹
GAPKI estimates that Indonesian CPO export in 2026 is potential to decline or at least stagnate compared to that in 2025.
POPSI: Mandatory B50 potential to pressure palm smallholders
On the other hand, the Association of Indonesian Palm Oil Smallholders (POPSI) has highlighted the impact of the mandatory B50 policy on the oil palm smallholders. POPSI Chairman Mansuetus Darto believes that reliance on the Oil Palm Plantation Fund Management Board (BPDPKS) for funding of the B50 program is potential to reduce funding allocated for the smallholders.⁴
According to Darto, BPDPKS funds should be used for replanting the smallholders’ oil palm plantations, increasing productivity, and strengthening sustainable development of smallholders. However, the increase of need for biodiesel funding is feared to marginalize those programs.⁴
RI’s Palm industry facing more complex challenges in 2026
With a combination of stagnant production, rising global demand, steadily rising domestic consumption, and an increasingly aggressive biodiesel program, the Indonesian palm oil industry is expected to face increasingly complex challenges in 2026.
Industry players believe that future palm oil policies need to be designed in a more balanced manner. In addition to supporting national energy security, such policies are also expected to maintain the competitiveness of CPO exports, price stability, foreign exchange earnings, and the welfare of oil palm smallholders. (*) GAPKI
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Indonesia mulls palm oil export levy hike to support biodiesel mandate
JAKARTA (Jan 8): Indonesia will likely increase its palm oil export levy to support the country's biodiesel mandate, energy ministry official Eniya Listiani Dewi told reporters on Thursday, citing tightening funds.
Indonesia, the largest palm oil producer, has implemented a mandatory 40% palm-based biodiesel blend, known as B40, the highest blending rate in the world. It seeks to increase the blend to 50% later this year.
Indonesia subsidises its biodiesel programme using proceeds from palm oil export levies, which are currently set at 10% of its monthly reference price for crude palm oil (CPO), with the levy on more refined products ranging between 4.75% and 9.5%.
"Whether it is B40 or B50, it has to be raised, according to an economic affairs ministry study," Eniya told reporters, adding that the cash reserves managed by the country's plantation fund were dwindling.
A meeting to discuss the levy hike will be held next week, she added.
Indonesia consumed 14.2 million kilolitres of palm-based biodiesel in 2025, a 7.6% increase compared to the previous year, energy ministry data showed on Thursday.
A road test for B50, which typically takes six months, has started in December, the energy minister said.
The energy ministry has allocated 15.65 million kilolitres of palm-based biodiesel for this year's blending mandate. The Edge
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AGO to Seize 4–5 Million Hectares of Illegal Palm Oil Plantation Land in 2026: President Prabowo
Inp.polri.go.id - Karawang. President Prabowo Subianto announced that the Attorney General's Office (AGO) will seize an additional 4 to 5 million hectares of problematic palm oil plantations in 2026, as part of the government's crackdown on illegal land control and corruption.
"We have already confiscated four million hectares of palm oil plantations that violate the law, and in 2026 we will seize another four to five million hectares," he said during a national harvest event in Karawang, West Java, on Wednesday (7/1/2026), as quoted by antarnews.com.
The President said the seizures are aimed at restoring state authority over illegally occupied forest areas and safeguarding public assets. He added that the government has also taken action against hundreds of illegal mining operations, saving the state hundreds of trillions of rupiah.
He added that illegal land and mining practices have persisted for years due to corruption and weak enforcement. He stressed that law enforcement agencies must act firmly and with integrity to ensure public funds fully benefit the people. POLRI
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Church, activists oppose palm oil expansion in Indonesia’s Papua
The move will cause far higher damages to environment and tribal people than economic benefits, critics say
A Catholic bishop has joined rights activists and tribal leaders to oppose a government plan to expand palm oil plantations in Indonesia’s Papua region, terming the move a threat to environment and indigenous communities.
In a statement on Jan. 8, Augustinian Bishop Bernardus Baru of Timika said expansion of oil plantations will have higher tolls on environment and forest-dependent local communities than so-called positive impacts claimed by the government of President Prabowo Subianto.
"Therefore, stop clearing forests. If you want the world to end quickly, go ahead. It won't be long before the end of the world if the government persists with its plan," Baru said in the statement.
He lamented that the world is becoming “increasingly greedy” and it wants to “destroy everything.”
“Humans should only need what they need," the prelate added.
The government plan was disclosed in a statement from the President last month that stated, "Oil palms should be planted in Papua so that we can produce fuel from palm oil."
The president claimed that within five years, all regions of Papua will become self-sufficient in food and energy from palm oil, thus saving national funds currently used for fuel subsidies.
Bishop Baru pointed to the recent devastating flood and landslide in Sumatra Island that claimed more than a thousand lives and blamed environmental destruction for aggravating the climate crisis. UCA NEWS
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Feedstock production for biofuels buffers supply to safeguard global nutrition
Crop plants were grown on just over 1.2 billion hectares worldwide in 2024. These include grain, oilseeds, protein, sugar and fibre plants, as well as fruits, vegetables, and nuts.
The largest share was used directly or indirectly, via livestock feed, for human nutrition.
The cultivation of feedstocks for biofuel production accounted for only about 7% of the cultivated land.
Most biofuels are produced in regions with a structural feedstock surplus, specifically, sugar, maize, palm oil and soybean oil.
In the absence of this way of processing, considerable volumes would have to be placed on the world market, which, in turn, would have a negative impact on producer prices globally. In other words, processing these feedstocks into biofuels contributes to reducing surpluses as well as generating additional value added.
According to Agrarmarkt Informations-Gesellschaft, at the same time the use of biofuels reduces the need for imports of crude oil or fossil fuel in many countries.
From the perspective of the Union zur Förderung von Oel- und Proteinpflanzen (UFOP), another effect of biofuel production is that it also yields high-quality protein feed, which is in high demand, and glycerin for the chemical industry.
These volumes and their quality influence commodity prices and, therefore, also have a bearing on the expansion or reduction of cultivation areas, particularly in the case of soybean.
UFOP has stated that biofuels are not a factor driving commodity prices. The corresponding feedstock can be redirected to food use at any time as and when needed. For example, at the beginning of the Russian attack on Ukraine rapeseed oil replaced previously imported sunflower seed oil.
If arable farming were to be extensified for political reasons – an aim the EU Commission is pursuing with the reduction strategy for fertilisers and plant protection products under the Green Deal – this option of "buffering" food demand would no longer be available.
UFOP has pointed out that the cultivation area would need to be expanded to close this demand gap. Biofuels News
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Palm Acid Oil Emerges as a Strategic Commodity as Europe Accelerates Renewable Energy Shift
PALMOILMAGAZINE, Kuala Lumpur — Palm-based downstream products are increasingly strengthening their strategic role in the global market. One product drawing growing attention is Palm Acid Oil (PAO), which has evolved from a traditional soap raw material into a key feedstock for renewable energy, oleochemicals, and animal feed industries.
As reported by Palmoilmagazine.com, citing an article by Hajar Shamsudin of the Malaysian Palm Oil Council (MPOC) on Sunday (January 4, 2026), PAO is a by-product generated from the alkaline refining of palm oil. Its high free fatty acid (FFA) content makes it highly suitable for a wide range of industrial applications.
Technically, PAO is a fatty acid fraction obtained through distillation from palm oil mill effluent (POME) and chemically refined palm oil. It consists of neutral oil, FFA levels exceeding 50 percent, and low moisture content of around 2–3 percent. These characteristics make PAO particularly well suited for biodiesel production, animal feed, and soap manufacturing.
Although its FFA content is slightly lower than that of Palm Fatty Acid Distillate (PFAD), PAO shares similar chemical properties. This flexibility positions PAO as an efficient and sustainable alternative within the global supply chain, especially as the clean energy transition accelerates worldwide.
Rapid Global Market Expansion
In value terms, the global PAO market was estimated at US$820 million in 2025 and is projected to grow at a compound annual growth rate (CAGR) of 8.5 percent through 2034, potentially reaching around US$1.72 billion. This expansion is being driven primarily by surging demand for biodiesel feedstock, supported by renewable energy policies and carbon emission reduction targets across major economies.
Beyond bioenergy, demand for PAO in oleochemicals and animal feed continues to rise, in line with growing global consumption of soaps, detergents, and livestock nutrition products. Its cost efficiency, broad usability, and compatibility with green policies are expected to keep PAO a strategic commodity over the next decade.
From Biodiesel to Cosmetics
In the biodiesel sector, PAO serves as an important feedstock due to its high FFA content, which is ideal for transesterification processes. The strongest demand comes from regions with biofuel blending mandates, notably Malaysia, Indonesia, and the European Union.
Within the oleochemical industry, PAO is processed into fatty acids and intermediate materials for cosmetic and chemical manufacturing, including glycerine and esters. Meanwhile, in the soap and detergent sector, the lauric and palmitic acid content of PAO enhances cleansing performance and soap hardness, making it a preferred raw material for large-scale production.
Sweden and Italy Emerge as Distinct EU Markets
Within the EU-27, Sweden and Italy have emerged as notable PAO markets. In the first nine months of 2025, Malaysia exported 64,151 tons of PAO worth 237 million Malaysian ringgit, or approximately €49 million, to the two countries.
Sweden recorded the largest volume, importing more than 53,000 tons between January and September 2025. This is considered unusual, given Sweden’s relatively small population of about 10.5 million, and even exceeded its imports of several more commonly traded palm-based products.
Italy, meanwhile, began importing PAO in 2025 after recording zero imports in 2024, opening new opportunities for Malaysian exporters in the European market. Palm Oil Magazine
January 08, 2026
Indonesia-US Trade Deal: Analyst Warns of Retaliation from China, EU
Jakarta. A senior economist has warned Indonesia of possible retaliation from other countries like China and the European Union, or EU, if Jakarta pushes ahead with the tariff deal with the US.
Indonesia and the US are now at the final stage of their reciprocal trade agreement negotiations. The signing is scheduled for later this month, with President Prabowo Subianto set to fly to the White House to give his signature. The speedy negotiations had seen Jakarta granting US businesses special treatment, ranging from 0% tariffs, access to critical minerals, to $15 billion worth of energy import pledges. On the other hand, Indonesian exports are subject to a 19% tariff, except for commodities not naturally available in the US, such as palm oil and cocoa.
Yose Rizal Damuri, the executive director of the think-tank CSIS, told reporters on Wednesday that the one-sided deal might upset other countries.
“[Indonesia] will face pressure from other countries that wish to have the same thing that the US gets. … China might use this as a basis to demand the same treatment, or maybe the EU. … Remember it took us almost 10 years to have a free trade agreement with the EU, but the US managed to secure better terms in just 6 months,” Yose said.
“Such cases can even lead to retaliation. So countries are not only demanding the same treatment, but could even retaliate if they feel the concessions we make for Washington put them at a disadvantage. This will disrupt our trade stability,” Yose stated.
China is Indonesia’s biggest trading partner, although Jakarta ran a $19.28 billion non-oil and gas deficit in 2025 as of November, official statistics showed. Their bilateral export activities can enjoy zero tariffs under the Regional Comprehensive Economic Partnership (RCEP). Beijing is also a major investor in Southeast Asia’s biggest economy.
Indonesia’s annual non-oil surplus with the EU totaled $6.55 billion as of November 2025. Under an upcoming free trade agreement, Indonesia and the EU will remove virtually all tariffs on each other’s goods, possibly starting next year.
Yose also warned that the US deal was “far from reciprocal” as Indonesia’s key manufactured exports like footwear and textiles are still subject to the 19% import tax. Business lobby group Apindo, too, is keeping its fingers crossed that manufactured goods could sooner or later enter the American market tariff-free.
The Donald Trump administration is currently busy with its capture of Venezuela’s now-ousted leader Nicolas Maduro. State Secretary Prasetyo Hadi has said that the Venezuela crisis would not affect the US tariff negotiations, and that everything would “remain on schedule”.
Indonesia has called on everyone to pursue dialogue following US strike on Venezuela. However, Former Deputy Foreign Minister Dino Patti Djalal is unhappy with Jakarta’s official statement, slamming the wording as being “very standard”. Jakarta, too, shied away from directly condemning Trump. Jakarta city guide
“Partnering with the US, or any country, must not make Indonesia a submissive country that sacrifices principles,” Dino said. Jakarta Globe
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Indonesia mulls palm oil export levy hike to support biodiesel mandate
JAKARTA, Jan 8 (Reuters) - Indonesia will likely increase its palm oil export levy to support the country's biodiesel mandate, energy ministry official Eniya Listiani Dewi told reporters on Thursday, citing tightening funds.
Indonesia, the largest palm oil producer, has implemented a mandatory 40% palm-based biodiesel blend, known as B40, the highest blending rate in the world. It seeks to increase the blend to 50% later this year.
Indonesia subsidises its biodiesel programme using proceeds from palm oil export levies, which are currently set at 10% of its monthly reference price for crude palm oil (CPO), with the levy on more refined products ranging between 4.75% and 9.5%.
"Whether it is B40 or B50, it has to be raised, according to an economic affairs ministry study," Eniya told reporters, adding that the cash reserves managed by the country's plantation fund were dwindling.
A meeting to discuss the levy hike will be held next week, she added.
Indonesia consumed 14.2 million kilolitres of palm-based biodiesel in 2025, a 7.6% increase compared to the previous year, energy ministry data showed on Thursday.
A road test for B50, which typically takes six months, has started in December, the energy minister said.
The energy ministry has allocated 15.65 million kilolitres of palm-based biodiesel for this year's blending mandate. Reuters
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Indonesia sharpens axe on land clawback, raising stakes for regional palm oil giants
Potential fines running into billions of dollars if disputed land is ultimately deemed illegal among investors’ concerns
[JAKARTA/SINGAPORE/KUALA LUMPUR] As Indonesia escalates its sweeping land seizure drive, plantation and mining firms across the region are confronting higher regulatory and financial risks after President Prabowo Subianto said the government could reclaim a further four to five million hectares (ha) this year.
The campaign, which spans hundreds of companies across palm oil, forestry and mining, is raising investor concerns over policy predictability and asset security in South-east Asia’s largest economy, with potential fines running into billions of dollars if disputed land is ultimately deemed illegal.
Jakarta has framed the move – one of the most significant structural shifts in Indonesia’s palm oil and mining industries – as a governance clean-up, with Prabowo seeking to reclaim assets which he said drained billions of dollars from the state through years of improper and illegal licensing.
“We have taken action against hundreds of illegal mines and saved hundreds of trillions of rupiah, but there is still a lot of leakage,” Prabowo said on Wednesday (Jan 7).
Melissa Cheok, director at Sustainable Fitch, said: “In the short run, headline actions heighten concerns not just about validity of the government’s claims to confiscate land but also policy predictability and asset security.”
The policy could hurt Malaysia and Singapore-listed companies with palm oil plantations in Indonesia, including upstream palm oil producers and resource firms. Business Times
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Indonesia ‘May Seize Another 5m Hectares of Palm Oil Plantations’
Indonesian president Prabowo’s robust policy of ousting illegal miners and plantation operators has unnerved business groups
Indonesian President Prabowo Subianto warned again this week that his government would intensify a nationwide crackdown on corruption and environmental crimes.
He also signalled his intention to smash the operators of illegal palm oil plantations, saying that authorities could seize a further 4-5 million hectares (12 million acres) of plantations this year. That is a land area bigger than Switzerland.
In a speech at the Attorney General’s Office in Jakarta two weeks ago, Prabowo said he believed many forest areas had been illegally controlled for years by unscrupulous business operators, and that potential state losses could be enormous if left unaddressed.
“This is just the beginning. If thoroughly examined, potential state losses could reach hundreds of trillions … They dared to insult the state, assuming officials at every level could be bought and bribed,” he was quoted as saying by state news agency Antara.
On Wednesday (Jan 7), Jakarta’s ‘strong man’ leader was at it again, saying it was his duty as president to protect state finances and ensure that no amount of public money is lost to corruption.
Last year, the Forest Area Control Task Force, made up of military officers, police and state prosecutors, took over 4.1 million hectares said to be operating illegally in forest areas, targeting major palm oil companies and smallholder farmers alike.
“We have controlled, have taken over 4 million hectares of palm oil plantations that have violated the laws. Isn’t that right, state attorney?” Prabowo said at a rice harvest ceremony with farmers.
“In 2026, maybe we will seize 4 or 5 million more,” he said, repeating a threat he made in his first state of the nation speech last August, before he formally took power in October.
At that time, he explained that some 5 million hectares of palm plantations have been under scrutiny for operating in protected forest areas, as well as not reporting their actual size, or not responding to summons from auditors.
Aggressive tactics unnerving several sectors
Prabowo, a former special forces commander known for his aggressive operational tactics, flagged his tough approach last August, saying the state could confiscate assets of companies that “manipulate and violate” Indonesia’s laws.
He said his government was also planning a crackdown on mining, adding that authorities had received reports of as many as 1,063 illegal operations throughout the vast, mineral-rich archipelago.
He did not specify what type of mines or the commodities they were extracting. Indonesia is also the world’s biggest producer of nickel and a major producer of thermal coal, tin, and copper.
On Wednesday, the president said the government has also taken action against hundreds of illegal mining operations, saving the state hundreds of trillions of rupiah through enforcement and asset recovery.
“We have acted against hundreds of illegal mines and saved hundreds of trillions,” he was quoted as saying by Antara, adding that authorities would continue pursuing losses to ensure public funds fully benefit Indonesians.
Not surprisingly, the military-backed campaign launched in early 2025 has unnerved the palm oil industry. The Southeast Asian nation is the world’s biggest producer of palm oil and has a total of 16.8 million hectares of palm oil plantations.
Analysts have also predicted that in combination with Indonesia’s ambitious biodiesel plans, the seizures could put even more upward pressure on global prices by disrupting production.
In August, Indonesian Palm Oil Association (GAPKI) chief Eddy Martono questioned the source of Prabowo’s figures, saying his organisation had not been consulted on the 5 million hectares number.
He said companies and cooperatives running the 3.7m hectares of plantations found to be operating illegally at that time had been asked to clarify their status and some had permits such as land-use concessions and ownership certificates.
But by the end of 2025, some 1.7 million hectares of the seized plantations were transferred to state-owned company Agrinas Palma Nusantara, transforming the firm from an infrastructure services company to the world’s largest palm oil company by area.
And Attorney General Sanitiar Burhanuddin said last month the government could collect $6.5 billion in fines from palm oil companies implicated in last year’s seizure.
Concern on other fronts too
These developments look positive, but there is also concern about the new president’s push to expand his power and the military’s role in civilian affairs, as well as his family’s business dealings.
The president himself is said to own half a million hectares, including land in Sumatra that was ravaged by flooding and landslides, where about 1,150 people died, according to a report by Asia Sentinel.
A corruption watchdog has voiced fears on where all this leads, and perhaps inevitably – whether Indonesia might experience a replay of the levels of graft that occurred when the country was ruled by Prabowo’s father-in-law, Suharto. Asia Times
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Indonesia's AGO to seize more illegal palm oil land in 2026
Jakarta (ANTARA) - President Prabowo Subianto said on Wednesday Indonesia's Attorney General's Office (AGO) will seize an additional four million to five million hectares of illegally operated palm oil plantations in 2026, intensifying a nationwide crackdown on corruption and environmental crimes.
Speaking at a harvest event in Karawang, West Java, Prabowo urged unity among institutions to enforce the law consistently and eradicate corruption that has long drained state revenues and harmed farmers.
“We have taken control and seized four million hectares of palm oil plantations that violated the law. In 2026, we will seize another four to five million hectares,” Prabowo said.
The president said the government has also taken action against hundreds of illegal mining operations, saving the state hundreds of trillions of rupiah through enforcement and asset recovery.
“We have acted against hundreds of illegal mines and saved hundreds of trillions,” he said, adding that authorities would continue pursuing losses to ensure public funds fully benefit Indonesians.
Related news: Berbak-Sembilang Park clears 98.8 hectares of illegal palm oil
Prabowo said no amount of public money should be lost to corruption, calling it his duty as president to protect state finances and uphold the mandate of his Red and White Cabinet.
He reiterated that the seizure of four million hectares of palm oil land announced in late 2025 marked only the beginning of a broader enforcement campaign.
Prabowo said he believes many forest areas remain under illegal control by business operators, with potential state losses reaching hundreds of trillions of rupiah if left unaddressed.
“This is just the beginning. If thoroughly examined, potential state losses could reach hundreds of trillions,” Prabowo said at the Attorney General’s Office in Jakarta on Dec. 24, 2025.
He said illegal control of forest land had persisted for years, enabled by corrupt practices that allowed unscrupulous businesses to bribe officials and evade accountability.
“They dared to insult the state, assuming officials at every level could be bought and bribed,” Prabowo said, describing systemic corruption in resource governance.
Prabowo urged the Forest Area Control Task Force, known as Satgas PKH, to maintain integrity, reject lobbying efforts and work with full dedication to defend the interests of the Indonesian people. Antara News
Indonesia-US Trade Deal: Analyst Warns of Retaliation from China, EU
Jakarta. A senior economist has warned Indonesia of possible retaliation from other countries like China and the European Union, or EU, if Jakarta pushes ahead with the tariff deal with the US.
Indonesia and the US are now at the final stage of their reciprocal trade agreement negotiations. The signing is scheduled for later this month, with President Prabowo Subianto set to fly to the White House to give his signature. The speedy negotiations had seen Jakarta granting US businesses special treatment, ranging from 0% tariffs, access to critical minerals, to $15 billion worth of energy import pledges. On the other hand, Indonesian exports are subject to a 19% tariff, except for commodities not naturally available in the US, such as palm oil and cocoa.
Yose Rizal Damuri, the executive director of the think-tank CSIS, told reporters on Wednesday that the one-sided deal might upset other countries.
“[Indonesia] will face pressure from other countries that wish to have the same thing that the US gets. … China might use this as a basis to demand the same treatment, or maybe the EU. … Remember it took us almost 10 years to have a free trade agreement with the EU, but the US managed to secure better terms in just 6 months,” Yose said.
“Such cases can even lead to retaliation. So countries are not only demanding the same treatment, but could even retaliate if they feel the concessions we make for Washington put them at a disadvantage. This will disrupt our trade stability,” Yose stated.
China is Indonesia’s biggest trading partner, although Jakarta ran a $19.28 billion non-oil and gas deficit in 2025 as of November, official statistics showed. Their bilateral export activities can enjoy zero tariffs under the Regional Comprehensive Economic Partnership (RCEP). Beijing is also a major investor in Southeast Asia’s biggest economy.
Indonesia’s annual non-oil surplus with the EU totaled $6.55 billion as of November 2025. Under an upcoming free trade agreement, Indonesia and the EU will remove virtually all tariffs on each other’s goods, possibly starting next year.
Yose also warned that the US deal was “far from reciprocal” as Indonesia’s key manufactured exports like footwear and textiles are still subject to the 19% import tax. Business lobby group Apindo, too, is keeping its fingers crossed that manufactured goods could sooner or later enter the American market tariff-free.
The Donald Trump administration is currently busy with its capture of Venezuela’s now-ousted leader Nicolas Maduro. State Secretary Prasetyo Hadi has said that the Venezuela crisis would not affect the US tariff negotiations, and that everything would “remain on schedule”.
Indonesia has called on everyone to pursue dialogue following US strike on Venezuela. However, Former Deputy Foreign Minister Dino Patti Djalal is unhappy with Jakarta’s official statement, slamming the wording as being “very standard”. Jakarta, too, shied away from directly condemning Trump. Jakarta city guide
“Partnering with the US, or any country, must not make Indonesia a submissive country that sacrifices principles,” Dino said. Jakarta Globe
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Indonesia mulls palm oil export levy hike to support biodiesel mandate
JAKARTA, Jan 8 (Reuters) - Indonesia will likely increase its palm oil export levy to support the country's biodiesel mandate, energy ministry official Eniya Listiani Dewi told reporters on Thursday, citing tightening funds.
Indonesia, the largest palm oil producer, has implemented a mandatory 40% palm-based biodiesel blend, known as B40, the highest blending rate in the world. It seeks to increase the blend to 50% later this year.
Indonesia subsidises its biodiesel programme using proceeds from palm oil export levies, which are currently set at 10% of its monthly reference price for crude palm oil (CPO), with the levy on more refined products ranging between 4.75% and 9.5%.
"Whether it is B40 or B50, it has to be raised, according to an economic affairs ministry study," Eniya told reporters, adding that the cash reserves managed by the country's plantation fund were dwindling.
A meeting to discuss the levy hike will be held next week, she added.
Indonesia consumed 14.2 million kilolitres of palm-based biodiesel in 2025, a 7.6% increase compared to the previous year, energy ministry data showed on Thursday.
A road test for B50, which typically takes six months, has started in December, the energy minister said.
The energy ministry has allocated 15.65 million kilolitres of palm-based biodiesel for this year's blending mandate. Reuters
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Indonesia sharpens axe on land clawback, raising stakes for regional palm oil giants
Potential fines running into billions of dollars if disputed land is ultimately deemed illegal among investors’ concerns
[JAKARTA/SINGAPORE/KUALA LUMPUR] As Indonesia escalates its sweeping land seizure drive, plantation and mining firms across the region are confronting higher regulatory and financial risks after President Prabowo Subianto said the government could reclaim a further four to five million hectares (ha) this year.
The campaign, which spans hundreds of companies across palm oil, forestry and mining, is raising investor concerns over policy predictability and asset security in South-east Asia’s largest economy, with potential fines running into billions of dollars if disputed land is ultimately deemed illegal.
Jakarta has framed the move – one of the most significant structural shifts in Indonesia’s palm oil and mining industries – as a governance clean-up, with Prabowo seeking to reclaim assets which he said drained billions of dollars from the state through years of improper and illegal licensing.
“We have taken action against hundreds of illegal mines and saved hundreds of trillions of rupiah, but there is still a lot of leakage,” Prabowo said on Wednesday (Jan 7).
Melissa Cheok, director at Sustainable Fitch, said: “In the short run, headline actions heighten concerns not just about validity of the government’s claims to confiscate land but also policy predictability and asset security.”
The policy could hurt Malaysia and Singapore-listed companies with palm oil plantations in Indonesia, including upstream palm oil producers and resource firms. Business Times
---------
Indonesia ‘May Seize Another 5m Hectares of Palm Oil Plantations’
Indonesian president Prabowo’s robust policy of ousting illegal miners and plantation operators has unnerved business groups
Indonesian President Prabowo Subianto warned again this week that his government would intensify a nationwide crackdown on corruption and environmental crimes.
He also signalled his intention to smash the operators of illegal palm oil plantations, saying that authorities could seize a further 4-5 million hectares (12 million acres) of plantations this year. That is a land area bigger than Switzerland.
In a speech at the Attorney General’s Office in Jakarta two weeks ago, Prabowo said he believed many forest areas had been illegally controlled for years by unscrupulous business operators, and that potential state losses could be enormous if left unaddressed.
“This is just the beginning. If thoroughly examined, potential state losses could reach hundreds of trillions … They dared to insult the state, assuming officials at every level could be bought and bribed,” he was quoted as saying by state news agency Antara.
On Wednesday (Jan 7), Jakarta’s ‘strong man’ leader was at it again, saying it was his duty as president to protect state finances and ensure that no amount of public money is lost to corruption.
Last year, the Forest Area Control Task Force, made up of military officers, police and state prosecutors, took over 4.1 million hectares said to be operating illegally in forest areas, targeting major palm oil companies and smallholder farmers alike.
“We have controlled, have taken over 4 million hectares of palm oil plantations that have violated the laws. Isn’t that right, state attorney?” Prabowo said at a rice harvest ceremony with farmers.
“In 2026, maybe we will seize 4 or 5 million more,” he said, repeating a threat he made in his first state of the nation speech last August, before he formally took power in October.
At that time, he explained that some 5 million hectares of palm plantations have been under scrutiny for operating in protected forest areas, as well as not reporting their actual size, or not responding to summons from auditors.
Aggressive tactics unnerving several sectors
Prabowo, a former special forces commander known for his aggressive operational tactics, flagged his tough approach last August, saying the state could confiscate assets of companies that “manipulate and violate” Indonesia’s laws.
He said his government was also planning a crackdown on mining, adding that authorities had received reports of as many as 1,063 illegal operations throughout the vast, mineral-rich archipelago.
He did not specify what type of mines or the commodities they were extracting. Indonesia is also the world’s biggest producer of nickel and a major producer of thermal coal, tin, and copper.
On Wednesday, the president said the government has also taken action against hundreds of illegal mining operations, saving the state hundreds of trillions of rupiah through enforcement and asset recovery.
“We have acted against hundreds of illegal mines and saved hundreds of trillions,” he was quoted as saying by Antara, adding that authorities would continue pursuing losses to ensure public funds fully benefit Indonesians.
Not surprisingly, the military-backed campaign launched in early 2025 has unnerved the palm oil industry. The Southeast Asian nation is the world’s biggest producer of palm oil and has a total of 16.8 million hectares of palm oil plantations.
Analysts have also predicted that in combination with Indonesia’s ambitious biodiesel plans, the seizures could put even more upward pressure on global prices by disrupting production.
In August, Indonesian Palm Oil Association (GAPKI) chief Eddy Martono questioned the source of Prabowo’s figures, saying his organisation had not been consulted on the 5 million hectares number.
He said companies and cooperatives running the 3.7m hectares of plantations found to be operating illegally at that time had been asked to clarify their status and some had permits such as land-use concessions and ownership certificates.
But by the end of 2025, some 1.7 million hectares of the seized plantations were transferred to state-owned company Agrinas Palma Nusantara, transforming the firm from an infrastructure services company to the world’s largest palm oil company by area.
And Attorney General Sanitiar Burhanuddin said last month the government could collect $6.5 billion in fines from palm oil companies implicated in last year’s seizure.
Concern on other fronts too
These developments look positive, but there is also concern about the new president’s push to expand his power and the military’s role in civilian affairs, as well as his family’s business dealings.
The president himself is said to own half a million hectares, including land in Sumatra that was ravaged by flooding and landslides, where about 1,150 people died, according to a report by Asia Sentinel.
A corruption watchdog has voiced fears on where all this leads, and perhaps inevitably – whether Indonesia might experience a replay of the levels of graft that occurred when the country was ruled by Prabowo’s father-in-law, Suharto. Asia Times
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Indonesia's AGO to seize more illegal palm oil land in 2026
Jakarta (ANTARA) - President Prabowo Subianto said on Wednesday Indonesia's Attorney General's Office (AGO) will seize an additional four million to five million hectares of illegally operated palm oil plantations in 2026, intensifying a nationwide crackdown on corruption and environmental crimes.
Speaking at a harvest event in Karawang, West Java, Prabowo urged unity among institutions to enforce the law consistently and eradicate corruption that has long drained state revenues and harmed farmers.
“We have taken control and seized four million hectares of palm oil plantations that violated the law. In 2026, we will seize another four to five million hectares,” Prabowo said.
The president said the government has also taken action against hundreds of illegal mining operations, saving the state hundreds of trillions of rupiah through enforcement and asset recovery.
“We have acted against hundreds of illegal mines and saved hundreds of trillions,” he said, adding that authorities would continue pursuing losses to ensure public funds fully benefit Indonesians.
Related news: Berbak-Sembilang Park clears 98.8 hectares of illegal palm oil
Prabowo said no amount of public money should be lost to corruption, calling it his duty as president to protect state finances and uphold the mandate of his Red and White Cabinet.
He reiterated that the seizure of four million hectares of palm oil land announced in late 2025 marked only the beginning of a broader enforcement campaign.
Prabowo said he believes many forest areas remain under illegal control by business operators, with potential state losses reaching hundreds of trillions of rupiah if left unaddressed.
“This is just the beginning. If thoroughly examined, potential state losses could reach hundreds of trillions,” Prabowo said at the Attorney General’s Office in Jakarta on Dec. 24, 2025.
He said illegal control of forest land had persisted for years, enabled by corrupt practices that allowed unscrupulous businesses to bribe officials and evade accountability.
“They dared to insult the state, assuming officials at every level could be bought and bribed,” Prabowo said, describing systemic corruption in resource governance.
Prabowo urged the Forest Area Control Task Force, known as Satgas PKH, to maintain integrity, reject lobbying efforts and work with full dedication to defend the interests of the Indonesian people. Antara News
January 07, 2026
Indonesia may seize another 5 million hectares of palm oil plantations in 2026
JAKARTA, Jan 7 (Reuters) - President Prabowo Subianto on Wednesday said that Indonesia may seize an additional 4 million to 5 million hectares (12 million acres) of palm oil plantations this year.
Last year, his task force, which comprises the military, the police and state prosecutors, took over 4.1 million hectares said to be operating illegally in forest areas, targeting major palm oil companies and smallholder farmers alike.
"We have controlled, have taken over 4 million hectares of palm oil plantations that have violated the laws. Isn't that right, state attorney?" Prabowo said at a rice harvest ceremony with farmers.
"In 2026 maybe we will seize 4 or 5 million more," he said.
Indonesia, the world's biggest producer of palm oil, has a total of 16.8 million hectares of palm oil plantations.
Launched in early 2025, the military-backed campaign has unnerved the palm oil industry, with analysts predicting that in combination with Indonesia's ambitious biodiesel plans, the seizures could put even more upward pressure on global prices by disrupting production.
Some 1.7 million hectares of the seized plantations were transferred to state-owned company Agrinas Palma Nusantara, transforming the firm from an infrastructure services company to the world's largest palm oil company by area.
Attorney General Sanitiar Burhanuddin last month said the government could collect $6.5 billion in fines from palm oil companies implicated in last year's seizure. Reuters
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The Race To End Deforestation: Progress, Pitfalls, And What’s Next
Between the attention on forests at COP30, emerging regulations, and many corporate pledges, 2025 was slated to be the year that companies eliminate the practice within their supply chains of clearing forests and natural landscapes for production.
As the calendar has turned to 2026, the truth is that we now know that dozens of the most at-risk companies have not reached that goal – but a few market leaders are proving that cleaning up supply chains is possible.
Let’s be clear: Protecting forests makes economic sense. Industries depend on the benefits that natural ecosystems provide to grow food, transport goods, and manufacture products.
Harming nature poses compounding financial risks to companies and their investors. If the largest food and agriculture companies don’t eliminate deforestation, it could cost them up to $150 billion in losses by 2030. Land use change – primarily for expanding agricultural operations – also accounts for a sizeable percentage of planet warming emissions and global biodiversity loss.
Growing awareness of the risks of biodiversity decline and the advantages of acting quickly have spurred private sector action in recent years, and we saw more positive developments unfold last year.
Positive Developments in 2025
Nature moved up the agenda at global climate events and in corporate strategic planning notably last year. At COP30 in November, for example, a first-of-its-kind fund open to public and private capital was launched aiming to both protect tropical rainforests and generate returns for investors. Ahead of pivotal parliament votes, companies and investors voiced their support for the timely and robust implementation of the European Union Deforestation Regulation, a law designed to prevent imports and exports associated with forest loss from entering or exiting the bloc.
And, encouragingly, more major companies are reporting taking key steps to end deforestation in their agricultural supply chains. With so much more work needed to keep trees standing, these leading firms are illustrating best practices that others can follow to mitigate risk and build resilience across the industry.
1/ Progress in monitoring commitments to protect forests
To meet regulatory requirements and consumer demand, companies must be able to verify they are sourcing products that are not contributing to forest loss. This is extremely important for companies that source the commodities commonly linked to environmental destruction such as palm oil, soy, cattle, cocoa, and timber, pulp, and paper. Companies are showing the most progress in monitoring their palm oil supplies, largely because of the availability of certified sustainable palm oil. Forbes
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Indonesia may seize another 5 million hectares of palm oil plantations in 2026
JAKARTA, Jan 7 (Reuters) - President Prabowo Subianto on Wednesday said that Indonesia may seize an additional 4 million to 5 million hectares (12 million acres) of palm oil plantations this year.
Last year, his task force, which comprises the military, the police and state prosecutors, took over 4.1 million hectares said to be operating illegally in forest areas, targeting major palm oil companies and smallholder farmers alike.
"We have controlled, have taken over 4 million hectares of palm oil plantations that have violated the laws. Isn't that right, state attorney?" Prabowo said at a rice harvest ceremony with farmers.
"In 2026 maybe we will seize 4 or 5 million more," he said.
Indonesia, the world's biggest producer of palm oil, has a total of 16.8 million hectares of palm oil plantations.
Launched in early 2025, the military-backed campaign has unnerved the palm oil industry, with analysts predicting that in combination with Indonesia's ambitious biodiesel plans, the seizures could put even more upward pressure on global prices by disrupting production.
Some 1.7 million hectares of the seized plantations were transferred to state-owned company Agrinas Palma Nusantara, transforming the firm from an infrastructure services company to the world's largest palm oil company by area.
Attorney General Sanitiar Burhanuddin last month said the government could collect $6.5 billion in fines from palm oil companies implicated in last year's seizure. Reuters
--------
The Race To End Deforestation: Progress, Pitfalls, And What’s Next
Between the attention on forests at COP30, emerging regulations, and many corporate pledges, 2025 was slated to be the year that companies eliminate the practice within their supply chains of clearing forests and natural landscapes for production.
As the calendar has turned to 2026, the truth is that we now know that dozens of the most at-risk companies have not reached that goal – but a few market leaders are proving that cleaning up supply chains is possible.
Let’s be clear: Protecting forests makes economic sense. Industries depend on the benefits that natural ecosystems provide to grow food, transport goods, and manufacture products.
Harming nature poses compounding financial risks to companies and their investors. If the largest food and agriculture companies don’t eliminate deforestation, it could cost them up to $150 billion in losses by 2030. Land use change – primarily for expanding agricultural operations – also accounts for a sizeable percentage of planet warming emissions and global biodiversity loss.
Growing awareness of the risks of biodiversity decline and the advantages of acting quickly have spurred private sector action in recent years, and we saw more positive developments unfold last year.
Positive Developments in 2025
Nature moved up the agenda at global climate events and in corporate strategic planning notably last year. At COP30 in November, for example, a first-of-its-kind fund open to public and private capital was launched aiming to both protect tropical rainforests and generate returns for investors. Ahead of pivotal parliament votes, companies and investors voiced their support for the timely and robust implementation of the European Union Deforestation Regulation, a law designed to prevent imports and exports associated with forest loss from entering or exiting the bloc.
And, encouragingly, more major companies are reporting taking key steps to end deforestation in their agricultural supply chains. With so much more work needed to keep trees standing, these leading firms are illustrating best practices that others can follow to mitigate risk and build resilience across the industry.
1/ Progress in monitoring commitments to protect forests
To meet regulatory requirements and consumer demand, companies must be able to verify they are sourcing products that are not contributing to forest loss. This is extremely important for companies that source the commodities commonly linked to environmental destruction such as palm oil, soy, cattle, cocoa, and timber, pulp, and paper. Companies are showing the most progress in monitoring their palm oil supplies, largely because of the availability of certified sustainable palm oil. Forbes
--------
January 06, 2026
Bappenas Supports Palm Oil Downstreaming to Advance Green Economy
In line with the Golden Indonesia 2045 vision and the target of achieving Net Zero Emissions by 2060 or earlier, the palm oil industry plays not only a strategic role as an economic pillar, but also serves as a model of sustainable transformation that creates green jobs, reduces poverty, and supports the clean energy transition.
Indonesia is committed to managing its natural resources in accordance with the principles of the Sustainable Development Goals (SDGs). “We will continue to balance growth with environmental stewardship, ensuring that our progress does not come at the expense of nature or future generations. Guided by Bali’s local wisdom, Tri Hita Karana, which emphasises harmony between God, people, and nature, we are building a global palm oil industry that is not only productive but also ethical, inclusive, and humane,” said the Minister for National Development Planning/Head of Bappenas Rachmat Pambudy at the 21st Indonesian Palm Oil Conference and 2026 Price Outlook (IPOC) 2025 in Bali on Thursday, 13 November.
Indonesia has the potential to be the world’s largest crude palm oil (CPO) producer, meeting around 59 per cent of global demand with production reaching 47.5 million tonnes. Palm oil is a strategic pillar of the Indonesian economy, driving exports, stimulating industries, and supporting millions of smallholder farmers. “We must help smallholders modernise, gain access to finance, adopt better technologies, and improve their productivity so they can compete and thrive within the global value chain,” emphasised Minister Rachmat. Sawit Indonesia
--------
Palm Rejection Will End Up Accelerating Global Deforestation
The global demand for vegetable oils is projected to continually see significant increase until 2050, along with the growth of global population and incomes.¹ Vegetable oils—including palm oil, soybean, rapeseed, and sunflower—have become the vital component of the global food system, industrial raw material, and a source of renewable energy (biofuel).²
With this encouraging growth, palm oil has been the target of a global smear campaign. But there is one fundamental fact that is often overlooked: blocking palm oil will not necessarily end the global demand for vegetable oils, but it will instead shift the pressures of demand for land and forest clearing to other countries where growers will plant other more land-intensive commodities.
Unstoppable Global Needs of Vegetable Oils
The rise in global demand for vegetable oils is driven by two main factors: global population growth and increasing per capita consumption in developing countries, mainly India and China¹. Per capita consumption of vegetable oils in developed countries has relatively reached saturation point, but in developing countries it continues to increase in line with their population and economic growth.
Many international projections indicate that vegetable oils are agricultural commodities that cannot be eliminated, even in healthier and more sustainable consumption scenarios². Therefore, the main problem facing the world is not about the option of using vegetable oils or not, but rather how to meet the demand with the most efficient and rational way of using land areas.
Palm Oil: The world’s most efficient vegetable oil in land use
Agronomically, oil palm is the most productive oil crop per unit of land area. Data shows that:
Palm plantations not resulted from clearing forests: Clear legal Fact
It is necessary to emphasize honestly based on legal facts:
Oil palm plantations in Indonesia are not located in forest areas.
Regulatory:
Hindering Palm Oil means raising deforestation in other countries
Hindering or rejecting palm oil will not necessarily reduce the global demand for vegetable oils. The demand will be certainly fulfilled with other vegetable oils such as soybeans, rapeseed, or sunflowers.
But those vegetable oils have a serious problem, which is concerned with their extremely land-intensive characteristics. To produce the same volume of oil as the palm oil, soybean oil requires up to ten times the size of land areas needed by palm oil.⁵ It means that meeting the world’s vegetable oil demand without palm oil will require massive land and forest clearing.
Various studies show that a scenario of replacing palm oil with other vegetable oils has the potential to increase global land use by hundreds of millions of hectares, particularly in South America, Africa, and other regions.⁵⁶ This pressure will almost certainly lead to much more extensive global deforestation.
Oil Palm as global forest buffers
Having very high productivity with good practices of cultivation on legal, non-forest land, oil palm has actually functioned as a buffer for global forests. It enables the world to meet its rising needs of vegetable oils with the least land use compared to other oils. Thus, oil palm has the following positive impacts:
Rejecting oil palm without providing realistic alternatives means:
--------
West Papua stresses indigenous approval for palm oil expansion
Manokwari (ANTARA) - The West Papua Provincial Government has underscored that any release of forest areas for palm oil plantation expansion must obtain approval from indigenous communities holding customary land rights.
Head of the West Papua Forestry Office Jimmy Walter Susanto said in Manokwari on Monday that indigenous aspirations are a top priority in policymaking related to forest utilization.
“West Papua has a standard operating procedure. Every plan to release forest areas must include a letter of approval from indigenous communities,” Susanto said.
He emphasized that the provincial government prioritizes indigenous participation in all forestry decisions to prevent social conflict and ensure investment projects respect community rights and forest sustainability.
“If indigenous communities disagree, the governor will not issue a recommendation, and we will also not issue technical considerations. This applies to all permits in the forestry sector,” he added.
Susanto noted that West Papua’s palm oil plantations are existing ones, with no new permits issued for clearing.
Current plantations are located in Manokwari, Teluk Bintuni, and Fakfak.
He also highlighted seven priority programs for carbon biomass sequestration under the FOLU Net Sink 2030 plan, including strategies to reduce deforestation and promote sustainable forest management.
Separately, Filep Wamafma, Chairman of Committee III of the Regional Representative Council (DPD), urged the government to conduct an in‑depth study before considering any expansion of palm oil plantations in Papua.
“Papuan indigenous people view the forest as a mother, a place of refuge, and a source of life,” Wamafma said.
He stressed that policy decisions must account for environmental, social, and cultural dimensions, as well as the sustainability of indigenous livelihoods.
Papua’s sensitive ecological characteristics, he warned, mean that resource‑based investments must not ignore community rights.
Wamafma added that the government should weigh potential impacts carefully to avoid natural disasters similar to those seen in Aceh, North Sumatra, and West Sumatra. Antara News
--------
Bappenas Supports Palm Oil Downstreaming to Advance Green Economy
In line with the Golden Indonesia 2045 vision and the target of achieving Net Zero Emissions by 2060 or earlier, the palm oil industry plays not only a strategic role as an economic pillar, but also serves as a model of sustainable transformation that creates green jobs, reduces poverty, and supports the clean energy transition.
Indonesia is committed to managing its natural resources in accordance with the principles of the Sustainable Development Goals (SDGs). “We will continue to balance growth with environmental stewardship, ensuring that our progress does not come at the expense of nature or future generations. Guided by Bali’s local wisdom, Tri Hita Karana, which emphasises harmony between God, people, and nature, we are building a global palm oil industry that is not only productive but also ethical, inclusive, and humane,” said the Minister for National Development Planning/Head of Bappenas Rachmat Pambudy at the 21st Indonesian Palm Oil Conference and 2026 Price Outlook (IPOC) 2025 in Bali on Thursday, 13 November.
Indonesia has the potential to be the world’s largest crude palm oil (CPO) producer, meeting around 59 per cent of global demand with production reaching 47.5 million tonnes. Palm oil is a strategic pillar of the Indonesian economy, driving exports, stimulating industries, and supporting millions of smallholder farmers. “We must help smallholders modernise, gain access to finance, adopt better technologies, and improve their productivity so they can compete and thrive within the global value chain,” emphasised Minister Rachmat. Sawit Indonesia
--------
Palm Rejection Will End Up Accelerating Global Deforestation
The global demand for vegetable oils is projected to continually see significant increase until 2050, along with the growth of global population and incomes.¹ Vegetable oils—including palm oil, soybean, rapeseed, and sunflower—have become the vital component of the global food system, industrial raw material, and a source of renewable energy (biofuel).²
With this encouraging growth, palm oil has been the target of a global smear campaign. But there is one fundamental fact that is often overlooked: blocking palm oil will not necessarily end the global demand for vegetable oils, but it will instead shift the pressures of demand for land and forest clearing to other countries where growers will plant other more land-intensive commodities.
Unstoppable Global Needs of Vegetable Oils
The rise in global demand for vegetable oils is driven by two main factors: global population growth and increasing per capita consumption in developing countries, mainly India and China¹. Per capita consumption of vegetable oils in developed countries has relatively reached saturation point, but in developing countries it continues to increase in line with their population and economic growth.
Many international projections indicate that vegetable oils are agricultural commodities that cannot be eliminated, even in healthier and more sustainable consumption scenarios². Therefore, the main problem facing the world is not about the option of using vegetable oils or not, but rather how to meet the demand with the most efficient and rational way of using land areas.
Palm Oil: The world’s most efficient vegetable oil in land use
Agronomically, oil palm is the most productive oil crop per unit of land area. Data shows that:
- oil palm produces around 3–4 tons of oil per hectare per year,
- soybean produces only around 0.4–0.5 tons of oil per hectare per year,
- and rapeseed and sunflower produce less than 1 ton of oil per hectare per year³.
- Considering these productivity levels, oil palm can produce more than seven times more oil than soybeans from the same size of land area⁴. This means that oil palm provides the world’s vegetable oil with the least land areas.
Palm plantations not resulted from clearing forests: Clear legal Fact
It is necessary to emphasize honestly based on legal facts:
Oil palm plantations in Indonesia are not located in forest areas.
Regulatory:
- Oil Palm plantations can only be developed in non-forest areas,
- All legal oil palm plantations are developed on land areas having the legal status of Land Use Rights (HGU),
- The HGU licensing process is strict, lengthy, and multi-layered,
- The government explicitly prohibits plantation activities in forest areas⁸.
- With this legal framework, there is no legal mechanism for oil palm plantations to clear forests. Any illegal forest clearing is a violation of the law, not the characteristic of the palm oil industry itself.
Hindering Palm Oil means raising deforestation in other countries
Hindering or rejecting palm oil will not necessarily reduce the global demand for vegetable oils. The demand will be certainly fulfilled with other vegetable oils such as soybeans, rapeseed, or sunflowers.
But those vegetable oils have a serious problem, which is concerned with their extremely land-intensive characteristics. To produce the same volume of oil as the palm oil, soybean oil requires up to ten times the size of land areas needed by palm oil.⁵ It means that meeting the world’s vegetable oil demand without palm oil will require massive land and forest clearing.
Various studies show that a scenario of replacing palm oil with other vegetable oils has the potential to increase global land use by hundreds of millions of hectares, particularly in South America, Africa, and other regions.⁵⁶ This pressure will almost certainly lead to much more extensive global deforestation.
Oil Palm as global forest buffers
Having very high productivity with good practices of cultivation on legal, non-forest land, oil palm has actually functioned as a buffer for global forests. It enables the world to meet its rising needs of vegetable oils with the least land use compared to other oils. Thus, oil palm has the following positive impacts:
- suppressing global agricultural expansion,
- reducing pressure on forest clearing in other countries,
- and helping maintain global environmental balance.
- The environmental problem lies not with the oil palm, but with how the world’s vegetable oil needs are met.
Rejecting oil palm without providing realistic alternatives means:
- global vegetable oil needs must still be fulfilled,
- production will shift to far more land-intensive crops,
- forest clearing and wildlife conversion will increase,
- and global deforestation will increase sharply.
--------
West Papua stresses indigenous approval for palm oil expansion
Manokwari (ANTARA) - The West Papua Provincial Government has underscored that any release of forest areas for palm oil plantation expansion must obtain approval from indigenous communities holding customary land rights.
Head of the West Papua Forestry Office Jimmy Walter Susanto said in Manokwari on Monday that indigenous aspirations are a top priority in policymaking related to forest utilization.
“West Papua has a standard operating procedure. Every plan to release forest areas must include a letter of approval from indigenous communities,” Susanto said.
He emphasized that the provincial government prioritizes indigenous participation in all forestry decisions to prevent social conflict and ensure investment projects respect community rights and forest sustainability.
“If indigenous communities disagree, the governor will not issue a recommendation, and we will also not issue technical considerations. This applies to all permits in the forestry sector,” he added.
Susanto noted that West Papua’s palm oil plantations are existing ones, with no new permits issued for clearing.
Current plantations are located in Manokwari, Teluk Bintuni, and Fakfak.
He also highlighted seven priority programs for carbon biomass sequestration under the FOLU Net Sink 2030 plan, including strategies to reduce deforestation and promote sustainable forest management.
Separately, Filep Wamafma, Chairman of Committee III of the Regional Representative Council (DPD), urged the government to conduct an in‑depth study before considering any expansion of palm oil plantations in Papua.
“Papuan indigenous people view the forest as a mother, a place of refuge, and a source of life,” Wamafma said.
He stressed that policy decisions must account for environmental, social, and cultural dimensions, as well as the sustainability of indigenous livelihoods.
Papua’s sensitive ecological characteristics, he warned, mean that resource‑based investments must not ignore community rights.
Wamafma added that the government should weigh potential impacts carefully to avoid natural disasters similar to those seen in Aceh, North Sumatra, and West Sumatra. Antara News
--------
January 05, 2026
Indonesia Tightens Grip on Resources with Switzerland-Sized Land Grab
More than 4 million hectares have been seized as President Prabowo Subianto cracks down on malfeasance in the commodities sector
(Bloomberg) — It started in earnest in March, with a swathe of palm-oil estates seized from a tycoon caught up in corruption allegations. Nine months later, a drive overseen by Indonesia’s defense minister has brought an area the size of Switzerland under state control.
The campaign, outwardly a push to improve governance, is a show of force by President Prabowo Subianto, an ex-general who has regularly railed against both Indonesian elites and foreigners for profiting off the country’s resource riches at the expense of the nation. Already, the central government has taken more than 4 million hectares (roughly 10 million acres) of plantations, mine concessions and processing facilities — and much of that land has been handed to a state-owned firm newly tasked with managing seized estates.
“This is just the beginning,” Prabowo said at an event late last month. “We are on the right and noble path of defending the interests of millions of Indonesians.”
Domestic upheaval could soon have global consequences. Indonesia is the world’s top exporter of coal and palm oil, the biggest nickel producer and a leading source of copper and tin — commodities key for food and energy supplies, as well as future-facing technologies. Financial Post/ Bloomberg
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Indonesia's West Java Province bans palm oil cultivation
In Indonesia, RRI reported that The West Java Provincial Administration has officially banned new palm oil cultivation across all 27 cities and regencies in the province. The prohibition was signed by Governor Dedi Mulyadi on December 29, 2025.
Governor Mulyadi announced the policy as part of efforts to safeguard environmental sustainability and protect natural resources. “The policy prohibits new palm oil planting across West Java, whether on land owned by communities, businesses, or other parties,” he said.
The ban has drawn sharp criticism from the Indonesian Palm Oil Farmers Association (APKASINDO), which called the regulation discriminatory and dismissive of plantations that have operated in West Java for decades.
Qayuum Amri, APKASINDO’s Deputy Chairman for Communications, said the policy appeared reactionary and was accompanied by claims that palm oil caused clean water crises and ecological disasters in the province, according to the report.
More on the story
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As Aceh reels from severe floods, NTU-led study in 2024 traces roots to forest loss
That changed after devastating monsoon floods in November, worsened by a rare cyclone, battered Aceh and parts of Sumatra, killing more than 1,000 people.
Environmentalists have blamed deforestation for aggravating the damage – a claim supported by a 2024 research paper on previous floods in Indonesia’s westernmost province.
Led by researchers from the NTU Asian School of the Environment, the study found that flood-prone areas in Aceh were likely to have fewer trees, more oil palm plantations and higher poverty rates.
By extracting data from primarily online news reports, the researchers found that more than 2,000 flood events happened in Aceh between 2011 and 2018.
Overall, the number of floods steadily increased each year, displacing around 158,000 people, as well as damaging about 24,500 houses and 11,500ha of agricultural land. Straits Times
Indonesia Tightens Grip on Resources with Switzerland-Sized Land Grab
More than 4 million hectares have been seized as President Prabowo Subianto cracks down on malfeasance in the commodities sector
(Bloomberg) — It started in earnest in March, with a swathe of palm-oil estates seized from a tycoon caught up in corruption allegations. Nine months later, a drive overseen by Indonesia’s defense minister has brought an area the size of Switzerland under state control.
The campaign, outwardly a push to improve governance, is a show of force by President Prabowo Subianto, an ex-general who has regularly railed against both Indonesian elites and foreigners for profiting off the country’s resource riches at the expense of the nation. Already, the central government has taken more than 4 million hectares (roughly 10 million acres) of plantations, mine concessions and processing facilities — and much of that land has been handed to a state-owned firm newly tasked with managing seized estates.
“This is just the beginning,” Prabowo said at an event late last month. “We are on the right and noble path of defending the interests of millions of Indonesians.”
Domestic upheaval could soon have global consequences. Indonesia is the world’s top exporter of coal and palm oil, the biggest nickel producer and a leading source of copper and tin — commodities key for food and energy supplies, as well as future-facing technologies. Financial Post/ Bloomberg
--------
Indonesia's West Java Province bans palm oil cultivation
In Indonesia, RRI reported that The West Java Provincial Administration has officially banned new palm oil cultivation across all 27 cities and regencies in the province. The prohibition was signed by Governor Dedi Mulyadi on December 29, 2025.
Governor Mulyadi announced the policy as part of efforts to safeguard environmental sustainability and protect natural resources. “The policy prohibits new palm oil planting across West Java, whether on land owned by communities, businesses, or other parties,” he said.
The ban has drawn sharp criticism from the Indonesian Palm Oil Farmers Association (APKASINDO), which called the regulation discriminatory and dismissive of plantations that have operated in West Java for decades.
Qayuum Amri, APKASINDO’s Deputy Chairman for Communications, said the policy appeared reactionary and was accompanied by claims that palm oil caused clean water crises and ecological disasters in the province, according to the report.
More on the story
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As Aceh reels from severe floods, NTU-led study in 2024 traces roots to forest loss
- Deforestation in Aceh, Indonesia, exacerbates monsoon floods, as highlighted by the devastating floods of November 2025 which killed over 1,000 people.
- An NTU study led by Dr Lubis (PLOS One) found flood-prone Aceh areas had fewer trees, more palm oil, and higher poverty, with over 2,000 floods between 2011-2018.
- Dr Lubis suggests conditional cash transfers linked to forest restoration can aid recovery and reduce future flood risk; Indonesia plans to revoke forestry permits.
That changed after devastating monsoon floods in November, worsened by a rare cyclone, battered Aceh and parts of Sumatra, killing more than 1,000 people.
Environmentalists have blamed deforestation for aggravating the damage – a claim supported by a 2024 research paper on previous floods in Indonesia’s westernmost province.
Led by researchers from the NTU Asian School of the Environment, the study found that flood-prone areas in Aceh were likely to have fewer trees, more oil palm plantations and higher poverty rates.
By extracting data from primarily online news reports, the researchers found that more than 2,000 flood events happened in Aceh between 2011 and 2018.
Overall, the number of floods steadily increased each year, displacing around 158,000 people, as well as damaging about 24,500 houses and 11,500ha of agricultural land. Straits Times
January 04, 2026
EU's due diligence: threat to global smallholder farmers
Environmental policy's impact on global agriculture and inequality
Smallholder farmers in places like southeast Asia are some of the world’s most deprived communities. They work hard day and night, often in very taxing conditions, to put food on the table and feed their families. Their plight goes largely ignored in the West. In fact, sometimes we in Europe are guilty of making their economic situation even worse by failing to understand the consequences of our actions.
That is exactly what the European Union is in danger of doing with a new policy called the Due Diligence Proposal. The idea behind this policy is to make supply chains for goods sold in Europe more environmentally sustainable. However, what it sounds like in theory is very different from what it does in practice. Instead of asking multi-billion-dollar trans-national corporations to take on the cost of their new checks, who can shoulder the burden, the EU instead looks set to implement the new rules in such a way that the smallholder farmers at the very beginning of the supply chains end up responsible.
As if it were not bad enough to lump farmers with immense new costs and responsibilities because of European politics, it looks likely that the law will not even succeed in achieving what European politicians say they want to achieve. The way the due diligence proposal is written out does not make sense. That’s because addressing a complex environmental issue like deforestation is not as simple as merely drowning products you don’t like in red tape.
The EU champions this law as a means to curb deforestation, but scant information is available about the specifics of how they see these verification checks working, their associated costs, and the hurdles they pose for legitimate businesses operating in Europe. Upon closer examination, numerous glaring flaws in the legislation emerge, such as the fact that it might end up exacerbating deforestation rather than mitigating it.
A key target for the EU’s stringent new verification process is palm oil, which stands as the most efficient option for vegetable oil mass production. Even environmental organisations like the WWF caution against vilifying palm oil due to its efficiency and affordability,1 especially amid soaring food prices and economic crisis around the world.2 The EU’s focus on palm oil could drive businesses towards less efficient alternative oils, ultimately harming both the environment and consumers’ wallets.
Beyond these implications, the EU’s policy decisions reverberate globally, particularly in decentralised industries like food production. The Due Diligence Proposal threatens the livelihoods of countless smallholder farmers worldwide who rely on exporting products like palm oil. Meeting the EU’s strict requirements necessitates extensive outreach, training, and compliance efforts in remote regions, imposing significant burdens on already financially vulnerable communities.
Brussels’ bureaucratic zeal seems oblivious to the adverse impacts of its policies on those who can least afford it, in this case marginalized farmers. While large corporations are able to navigate regulatory complexities with dedicated compliance departments, smallholder farmers lack such resources. As a consequence, these farmers face daunting challenges in complying with these new EU regulations, potentially jeopardizing their ability to participate in European markets at all and undermining their livelihoods.3
As the global economy continues to struggle under the immense weight of inflation and other economic challenges, including war and supply chain disruptions, coming down hard on some of the poorest farmers in the world so that middle-class shoppers and diners in Europe can feel a bit better about themselves and their consumption decisions seems particularly inappropriate. Those farmers should not be left out of the conversation.
The EU is pursuing this path despite warnings from affected nations like Malaysia4 and efforts by industry leaders to address environmental concerns in other ways which do not adversely affect smallholder farmers.5 It is hard to explain the EU’s determination to pursue this path despite these factors. It appears to be prioritising green optics over practicality. It risks exacerbating global inequalities and undermining the very communities it claims to protect in the process.
The EU would do well to remember its place in the world. It does not exist in a silo. It has a responsibility to consider the impacts its decisions have on the rest of the world, especially when poor communities are at stake. It is fair to say that this effect on smallholder farmers is a very high price to pay for an ecological law which looks set to fail. The EU is rushing to implement it without addressing its flaws. Both the environment and smallholder farmers look certain to lose out as a result.
Ultimately, meaningful environmental protection cannot be built on policies that shift responsibility downward and externalize costs onto the most vulnerable. If the EU genuinely seeks sustainable supply chains, it must engage farmers as partners, offer financial and technical support, and design laws grounded in social justice rather than symbolic regulation alone. MEER
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From Seizure to Business Asset: Indonesia's Palm Oil Land Policy Draws Criticism
PALMOILMAGAZINE, PEKANBARU — Environmental advocates’ hopes that millions of hectares of seized palm oil plantations would be restored to their original forest function are fading. Instead of rehabilitation, the land now risks being “whitewashed” and legalized for business use by state-owned enterprises (SOEs) through changes to forestry regulations.
The controversy intensified after Forestry Minister Raja Juli Antoni issued Ministerial Regulation No. 20/2025, revising rules on forest planning and changes in forest designation and function. The regulation opens the door to the partial release of forest areas for existing palm oil plantations that have been reclaimed by the state.
Article 326A paragraph (1) states that palm oil plantations located within forest areas that have been taken back under state control may have their forest status released. The following paragraph specifies that such releases apply to forest areas handed over to SOEs.
This policy has drawn sharp criticism from Abdul Aziz, Deputy Chairman of the Central Executive Board of Sawitku Masa Depanku (DPP-SAMADE). He argues the move contradicts the original narrative behind the seizure of palm oil plantations, which was framed as an effort to protect and restore forests.
“This is an extraordinary injustice. At the beginning, these plantations were taken over under the pretext of returning them to forest. In reality, they are being released into Other Land Use Areas (APL) for companies,” Abdul Aziz said in a statement received by Palmoilmagazine.com on Monday (29/12/2025).
According to Aziz, public support initially followed the seizures because people believed the state intended to restore ecological functions. With the new regulation, he says, the public has been systematically misled.
Millions of Hectares at Stake
Aziz acknowledged that the areas eligible for release are generally classified as Convertible Production Forest (HPK) and Permanent Production Forest (HP). However, if total seized palm oil plantations amount to around 4.08 million hectares, at least half could potentially be removed from forest status.
“If even half of that falls under HPK and HP, it means roughly two million hectares of forest area could be released. That’s not a small figure,” he said.
What concerns him most is that the release is intended for corporate use, even if managed by SOEs. “It is still business-oriented. The question is whether business interests are more important than environmental protection,” he added.
Aziz also questioned the readiness of the SOEs appointed to manage the seized plantations. He noted that these entities are relatively new and often do not operate the land directly, instead outsourcing operations through operational cooperation schemes (KSO).
“As a result of these KSO arrangements, many social problems have emerged, even leading to bloodshed. If the land is eventually released from forest status anyway, why not grant rights to the previous operators? They have applied for release for years and were ignored,” he said.
Disputed Claims and Massive Fines
Criticism has also been directed at what Aziz calls a unilateral process in designating forest areas. He argues that many palm oil lands were claimed as forest areas without transparent proof of formal boundary-setting procedures.
“The forestry authorities only show forest area maps. Evidence of boundary demarcation, mapping, and formal designation has never been presented to the public,” he said.
Under Article 22 of Government Regulation No. 44/2004, if third-party rights remain during boundary-setting, those rights must be resolved, with formal documentation in the form of Boundary Delimitation Minutes (BATB) signed by all parties.
Yet once land is alleged to fall within forest areas, businesses are immediately hit with administrative fines deemed unreasonable. Government Regulation No. 45/2025 sets fines at IDR 25 million per hectare per year of production.
“If a plantation has been producing for 10 years, the fine reaches IDR 250 million per hectare. For 100 hectares, that’s IDR 25 billion. The land is seized, fines keep running, and businesses have almost no room to defend themselves,” Aziz said.
‘Not on the People’s Side’
Aziz concluded that current forestry policies increasingly drift away from public interests. He noted that not a single hectare of seized land has been allocated to local or indigenous communities who have long lived alongside palm oil plantations.
“If the state truly stood with the people, it could distribute the seized land. Four million hectares could support two million households if each received two hectares. But that has not happened,” he said.
He also highlighted the plight of smallholders and former transmigrants whose land has been claimed as forest area. Applications for land release to access the Smallholder Palm Oil Replanting (PSR) program often stall, with farmers instead directed to social forestry schemes that retain forest status.
“For companies, regulations can be changed easily. For ordinary people, the door is firmly shut,” he said.
At the end of his statement, Aziz urged the public to push for the revocation of Ministerial Regulation No. 20/2025 and called on the government to establish an independent team to review forest area designations.
“If it is truly forest, then restore it as forest. Do not legalize it for business. The state should stand in the middle—not roll out the red carpet for a select few,” he said. Palm Oil Magazine
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Measuring the Destructive Force of Sumatra’s Floods and the Long-Neglected Path of Mitigation
PALMOILMAGAZINE, BANDUNG – The massive floods that swept across parts of Sumatra struck with little warning. Within just one to three days, rainfall equivalent to an entire month poured down at once. The sheer volume was staggering—roughly comparable to 2.24 times the capacity of the Jatiluhur Reservoir, which holds about 2.4 billion cubic meters of water. It is therefore unsurprising that the destruction was severe and the human toll devastating.
Casualty figures reflect the scale of the disaster: more than a thousand people were killed, hundreds remain missing, and nearly half a million were forced to flee their homes. While these numbers are far below the 2004 Aceh tsunami, which claimed around 169,000 lives, floods and tsunamis share a terrifying similarity—both occur when enormous volumes of water inundate land simultaneously. The difference lies in timing: tsunamis are triggered by massive earthquakes within seconds, while extreme floods are born from relentless rainfall over several days.
This episode of flooding in Sumatra was worsened by landscapes stripped of their natural buffers. Mining activities and logging that left land “bare of vegetation” allowed water to rush unimpeded downstream. Large logs—more than 50 centimeters in diameter and over four meters long—were swept away by the current, smashing into houses, bridges, and public facilities. Under normal conditions, moving timber weighing three to eight tons would require heavy machinery. During floods, however, the immense mass of water lifted and carried it with ease.
Indonesia’s Meteorology, Climatology, and Geophysics Agency (BMKG) recorded extreme rainfall across several regions. In Aceh, for example, daily rainfall reached 411 millimeters, while average soil absorption capacity is only about 200 millimeters. Once the soil becomes saturated, infiltration stops. All subsequent rainfall turns into surface runoff, merging into powerful currents that sweep away everything in their path. Average water levels reached around 40 centimeters, with some areas inundated by one to two meters—enough to carry massive logs downstream.
To grasp the scale, imagine the Jatiluhur Reservoir collapsing. Greater Jakarta would be submerged, with almost unimaginable consequences. The floods in Aceh, North Sumatra, and West Sumatra were estimated to carry more than twice the reservoir’s volume. In Aceh Tamiang alone, floodwaters were estimated at around 2.2 billion cubic meters in a single day, excluding upstream inflows. In Tapanuli, North Sumatra, volumes reached an estimated 4.15 billion cubic meters. Fortunately, Lake Toba—with a capacity of around 250 billion cubic meters—served as a “giant buffer,” reducing downstream discharge.
As always, disaster rekindled a familiar debate: forests and palm oil plantations were quickly blamed as the primary culprits. Yet this explanation is overly simplistic. Cities such as Jakarta, Bekasi, and Semarang—areas with little forest cover and virtually no palm oil plantations—are routinely hit by floods. Meanwhile, Riau, home to Indonesia’s largest palm oil acreage, was relatively spared during this event. This suggests that the decisive factor remains extreme volumes of water falling simultaneously, driven by climate anomalies, rising temperatures, wind dynamics, and even lunar gravitational effects.
This is where the issue broadens. Natural resource governance must indeed be evaluated and improved. But at the same time, Indonesia must avoid being trapped in narratives that ultimately benefit external interests. Many developed countries exhausted their forests long ago, yet Indonesia continues to be pressured to remain the world’s “lungs.” Critical scrutiny is necessary, but it must be grounded in national interests.
Ironically, much of the control over palm oil plantations, mining areas, and industrial forests lies with foreign interests or a narrow domestic elite. When disasters strike, their contributions are often negligible compared to the profits they have reaped. While the state may refuse foreign aid, it should firmly compel large corporations—especially those exploiting natural resources—to channel a portion of their gains into disaster response and recovery. Mobilizing hundreds of trillions of rupiah is not, in fact, impossible.
Amid the devastation, lessons must be learned. The social impact of flooding is far more enduring than physical damage. Trauma from losing family members, livelihoods, and a sense of security can last for years. Both local and central governments must therefore prioritize social recovery, not merely infrastructure reconstruction.
Also Read: India Predicted to Lead Global Palm Oil Demand in 2026 as China Holds
Looking ahead, this disaster should serve as a loud alarm for all stakeholders. Mitigation can no longer be piecemeal. The construction of dams, retention basins, infiltration pits, terracing, and river embankments must be accelerated. Reservoir water management must adapt to increasingly extreme seasons. Strict oversight of forestry, plantation, and mining sectors is non-negotiable, and environmental law enforcement must be consistent.
Indonesia lies in a disaster-prone region—vulnerable to earthquakes, climate change, and governance failures. As such, mitigation must be elevated to a national priority. The Sumatra floods are not merely natural disasters; they are reflections of policy choices that demand serious correction. Otherwise, the country will continue to count victims instead of preventing the next tragedy. (*)
By: Memet Hakim – Social and Hydrology Observer/ Palm Oil Magazine
EU's due diligence: threat to global smallholder farmers
Environmental policy's impact on global agriculture and inequality
Smallholder farmers in places like southeast Asia are some of the world’s most deprived communities. They work hard day and night, often in very taxing conditions, to put food on the table and feed their families. Their plight goes largely ignored in the West. In fact, sometimes we in Europe are guilty of making their economic situation even worse by failing to understand the consequences of our actions.
That is exactly what the European Union is in danger of doing with a new policy called the Due Diligence Proposal. The idea behind this policy is to make supply chains for goods sold in Europe more environmentally sustainable. However, what it sounds like in theory is very different from what it does in practice. Instead of asking multi-billion-dollar trans-national corporations to take on the cost of their new checks, who can shoulder the burden, the EU instead looks set to implement the new rules in such a way that the smallholder farmers at the very beginning of the supply chains end up responsible.
As if it were not bad enough to lump farmers with immense new costs and responsibilities because of European politics, it looks likely that the law will not even succeed in achieving what European politicians say they want to achieve. The way the due diligence proposal is written out does not make sense. That’s because addressing a complex environmental issue like deforestation is not as simple as merely drowning products you don’t like in red tape.
The EU champions this law as a means to curb deforestation, but scant information is available about the specifics of how they see these verification checks working, their associated costs, and the hurdles they pose for legitimate businesses operating in Europe. Upon closer examination, numerous glaring flaws in the legislation emerge, such as the fact that it might end up exacerbating deforestation rather than mitigating it.
A key target for the EU’s stringent new verification process is palm oil, which stands as the most efficient option for vegetable oil mass production. Even environmental organisations like the WWF caution against vilifying palm oil due to its efficiency and affordability,1 especially amid soaring food prices and economic crisis around the world.2 The EU’s focus on palm oil could drive businesses towards less efficient alternative oils, ultimately harming both the environment and consumers’ wallets.
Beyond these implications, the EU’s policy decisions reverberate globally, particularly in decentralised industries like food production. The Due Diligence Proposal threatens the livelihoods of countless smallholder farmers worldwide who rely on exporting products like palm oil. Meeting the EU’s strict requirements necessitates extensive outreach, training, and compliance efforts in remote regions, imposing significant burdens on already financially vulnerable communities.
Brussels’ bureaucratic zeal seems oblivious to the adverse impacts of its policies on those who can least afford it, in this case marginalized farmers. While large corporations are able to navigate regulatory complexities with dedicated compliance departments, smallholder farmers lack such resources. As a consequence, these farmers face daunting challenges in complying with these new EU regulations, potentially jeopardizing their ability to participate in European markets at all and undermining their livelihoods.3
As the global economy continues to struggle under the immense weight of inflation and other economic challenges, including war and supply chain disruptions, coming down hard on some of the poorest farmers in the world so that middle-class shoppers and diners in Europe can feel a bit better about themselves and their consumption decisions seems particularly inappropriate. Those farmers should not be left out of the conversation.
The EU is pursuing this path despite warnings from affected nations like Malaysia4 and efforts by industry leaders to address environmental concerns in other ways which do not adversely affect smallholder farmers.5 It is hard to explain the EU’s determination to pursue this path despite these factors. It appears to be prioritising green optics over practicality. It risks exacerbating global inequalities and undermining the very communities it claims to protect in the process.
The EU would do well to remember its place in the world. It does not exist in a silo. It has a responsibility to consider the impacts its decisions have on the rest of the world, especially when poor communities are at stake. It is fair to say that this effect on smallholder farmers is a very high price to pay for an ecological law which looks set to fail. The EU is rushing to implement it without addressing its flaws. Both the environment and smallholder farmers look certain to lose out as a result.
Ultimately, meaningful environmental protection cannot be built on policies that shift responsibility downward and externalize costs onto the most vulnerable. If the EU genuinely seeks sustainable supply chains, it must engage farmers as partners, offer financial and technical support, and design laws grounded in social justice rather than symbolic regulation alone. MEER
--------
From Seizure to Business Asset: Indonesia's Palm Oil Land Policy Draws Criticism
PALMOILMAGAZINE, PEKANBARU — Environmental advocates’ hopes that millions of hectares of seized palm oil plantations would be restored to their original forest function are fading. Instead of rehabilitation, the land now risks being “whitewashed” and legalized for business use by state-owned enterprises (SOEs) through changes to forestry regulations.
The controversy intensified after Forestry Minister Raja Juli Antoni issued Ministerial Regulation No. 20/2025, revising rules on forest planning and changes in forest designation and function. The regulation opens the door to the partial release of forest areas for existing palm oil plantations that have been reclaimed by the state.
Article 326A paragraph (1) states that palm oil plantations located within forest areas that have been taken back under state control may have their forest status released. The following paragraph specifies that such releases apply to forest areas handed over to SOEs.
This policy has drawn sharp criticism from Abdul Aziz, Deputy Chairman of the Central Executive Board of Sawitku Masa Depanku (DPP-SAMADE). He argues the move contradicts the original narrative behind the seizure of palm oil plantations, which was framed as an effort to protect and restore forests.
“This is an extraordinary injustice. At the beginning, these plantations were taken over under the pretext of returning them to forest. In reality, they are being released into Other Land Use Areas (APL) for companies,” Abdul Aziz said in a statement received by Palmoilmagazine.com on Monday (29/12/2025).
According to Aziz, public support initially followed the seizures because people believed the state intended to restore ecological functions. With the new regulation, he says, the public has been systematically misled.
Millions of Hectares at Stake
Aziz acknowledged that the areas eligible for release are generally classified as Convertible Production Forest (HPK) and Permanent Production Forest (HP). However, if total seized palm oil plantations amount to around 4.08 million hectares, at least half could potentially be removed from forest status.
“If even half of that falls under HPK and HP, it means roughly two million hectares of forest area could be released. That’s not a small figure,” he said.
What concerns him most is that the release is intended for corporate use, even if managed by SOEs. “It is still business-oriented. The question is whether business interests are more important than environmental protection,” he added.
Aziz also questioned the readiness of the SOEs appointed to manage the seized plantations. He noted that these entities are relatively new and often do not operate the land directly, instead outsourcing operations through operational cooperation schemes (KSO).
“As a result of these KSO arrangements, many social problems have emerged, even leading to bloodshed. If the land is eventually released from forest status anyway, why not grant rights to the previous operators? They have applied for release for years and were ignored,” he said.
Disputed Claims and Massive Fines
Criticism has also been directed at what Aziz calls a unilateral process in designating forest areas. He argues that many palm oil lands were claimed as forest areas without transparent proof of formal boundary-setting procedures.
“The forestry authorities only show forest area maps. Evidence of boundary demarcation, mapping, and formal designation has never been presented to the public,” he said.
Under Article 22 of Government Regulation No. 44/2004, if third-party rights remain during boundary-setting, those rights must be resolved, with formal documentation in the form of Boundary Delimitation Minutes (BATB) signed by all parties.
Yet once land is alleged to fall within forest areas, businesses are immediately hit with administrative fines deemed unreasonable. Government Regulation No. 45/2025 sets fines at IDR 25 million per hectare per year of production.
“If a plantation has been producing for 10 years, the fine reaches IDR 250 million per hectare. For 100 hectares, that’s IDR 25 billion. The land is seized, fines keep running, and businesses have almost no room to defend themselves,” Aziz said.
‘Not on the People’s Side’
Aziz concluded that current forestry policies increasingly drift away from public interests. He noted that not a single hectare of seized land has been allocated to local or indigenous communities who have long lived alongside palm oil plantations.
“If the state truly stood with the people, it could distribute the seized land. Four million hectares could support two million households if each received two hectares. But that has not happened,” he said.
He also highlighted the plight of smallholders and former transmigrants whose land has been claimed as forest area. Applications for land release to access the Smallholder Palm Oil Replanting (PSR) program often stall, with farmers instead directed to social forestry schemes that retain forest status.
“For companies, regulations can be changed easily. For ordinary people, the door is firmly shut,” he said.
At the end of his statement, Aziz urged the public to push for the revocation of Ministerial Regulation No. 20/2025 and called on the government to establish an independent team to review forest area designations.
“If it is truly forest, then restore it as forest. Do not legalize it for business. The state should stand in the middle—not roll out the red carpet for a select few,” he said. Palm Oil Magazine
--------
Measuring the Destructive Force of Sumatra’s Floods and the Long-Neglected Path of Mitigation
PALMOILMAGAZINE, BANDUNG – The massive floods that swept across parts of Sumatra struck with little warning. Within just one to three days, rainfall equivalent to an entire month poured down at once. The sheer volume was staggering—roughly comparable to 2.24 times the capacity of the Jatiluhur Reservoir, which holds about 2.4 billion cubic meters of water. It is therefore unsurprising that the destruction was severe and the human toll devastating.
Casualty figures reflect the scale of the disaster: more than a thousand people were killed, hundreds remain missing, and nearly half a million were forced to flee their homes. While these numbers are far below the 2004 Aceh tsunami, which claimed around 169,000 lives, floods and tsunamis share a terrifying similarity—both occur when enormous volumes of water inundate land simultaneously. The difference lies in timing: tsunamis are triggered by massive earthquakes within seconds, while extreme floods are born from relentless rainfall over several days.
This episode of flooding in Sumatra was worsened by landscapes stripped of their natural buffers. Mining activities and logging that left land “bare of vegetation” allowed water to rush unimpeded downstream. Large logs—more than 50 centimeters in diameter and over four meters long—were swept away by the current, smashing into houses, bridges, and public facilities. Under normal conditions, moving timber weighing three to eight tons would require heavy machinery. During floods, however, the immense mass of water lifted and carried it with ease.
Indonesia’s Meteorology, Climatology, and Geophysics Agency (BMKG) recorded extreme rainfall across several regions. In Aceh, for example, daily rainfall reached 411 millimeters, while average soil absorption capacity is only about 200 millimeters. Once the soil becomes saturated, infiltration stops. All subsequent rainfall turns into surface runoff, merging into powerful currents that sweep away everything in their path. Average water levels reached around 40 centimeters, with some areas inundated by one to two meters—enough to carry massive logs downstream.
To grasp the scale, imagine the Jatiluhur Reservoir collapsing. Greater Jakarta would be submerged, with almost unimaginable consequences. The floods in Aceh, North Sumatra, and West Sumatra were estimated to carry more than twice the reservoir’s volume. In Aceh Tamiang alone, floodwaters were estimated at around 2.2 billion cubic meters in a single day, excluding upstream inflows. In Tapanuli, North Sumatra, volumes reached an estimated 4.15 billion cubic meters. Fortunately, Lake Toba—with a capacity of around 250 billion cubic meters—served as a “giant buffer,” reducing downstream discharge.
As always, disaster rekindled a familiar debate: forests and palm oil plantations were quickly blamed as the primary culprits. Yet this explanation is overly simplistic. Cities such as Jakarta, Bekasi, and Semarang—areas with little forest cover and virtually no palm oil plantations—are routinely hit by floods. Meanwhile, Riau, home to Indonesia’s largest palm oil acreage, was relatively spared during this event. This suggests that the decisive factor remains extreme volumes of water falling simultaneously, driven by climate anomalies, rising temperatures, wind dynamics, and even lunar gravitational effects.
This is where the issue broadens. Natural resource governance must indeed be evaluated and improved. But at the same time, Indonesia must avoid being trapped in narratives that ultimately benefit external interests. Many developed countries exhausted their forests long ago, yet Indonesia continues to be pressured to remain the world’s “lungs.” Critical scrutiny is necessary, but it must be grounded in national interests.
Ironically, much of the control over palm oil plantations, mining areas, and industrial forests lies with foreign interests or a narrow domestic elite. When disasters strike, their contributions are often negligible compared to the profits they have reaped. While the state may refuse foreign aid, it should firmly compel large corporations—especially those exploiting natural resources—to channel a portion of their gains into disaster response and recovery. Mobilizing hundreds of trillions of rupiah is not, in fact, impossible.
Amid the devastation, lessons must be learned. The social impact of flooding is far more enduring than physical damage. Trauma from losing family members, livelihoods, and a sense of security can last for years. Both local and central governments must therefore prioritize social recovery, not merely infrastructure reconstruction.
Also Read: India Predicted to Lead Global Palm Oil Demand in 2026 as China Holds
Looking ahead, this disaster should serve as a loud alarm for all stakeholders. Mitigation can no longer be piecemeal. The construction of dams, retention basins, infiltration pits, terracing, and river embankments must be accelerated. Reservoir water management must adapt to increasingly extreme seasons. Strict oversight of forestry, plantation, and mining sectors is non-negotiable, and environmental law enforcement must be consistent.
Indonesia lies in a disaster-prone region—vulnerable to earthquakes, climate change, and governance failures. As such, mitigation must be elevated to a national priority. The Sumatra floods are not merely natural disasters; they are reflections of policy choices that demand serious correction. Otherwise, the country will continue to count victims instead of preventing the next tragedy. (*)
By: Memet Hakim – Social and Hydrology Observer/ Palm Oil Magazine
January 2026
New Indonesian FTA Opens Path to $2.56 Trillion Eurasian Trade Bloc
Jakarta. A newly signed free trade agreement with the Eurasian Economic Union (EAEU) is raising hopes among Indonesian exporters that they can reduce their dependence on the US market amid growing protectionism under President Donald Trump.Jakarta events calendar
The Eurasian Economic Union — which includes Russia, Armenia, Belarus, Kazakhstan, and Kyrgyzstan — represents a combined gross domestic product of about $2.56 trillion. Under the Indonesia–EAEU free trade agreement, the bloc will grant Indonesia preferential treatment on 90.5% of its tariff lines.
Trade Minister Budi Santoso has said the agreement would reduce import duties to levels “close to zero,” although he has not disclosed the precise rates.
For exporters, the agreement — which is expected to enter into force by 2027 — could position Eurasia as a viable alternative market to the United States. The Indonesian Employers Association (Apindo) said Indonesia exports broadly similar products to both markets, including footwear, palm oil, and apparel.
These sectors have been affected by Trump’s reciprocal tariffs of 19%, although palm oil is expected to receive an exemption.
“Unlocking the EAEU market can help us diversify apparel and footwear exports,” Apindo chairwoman Shinta Kamdani said. “These capital-intensive products have long relied heavily on the US market. That overdependence has made the sector vulnerable to tariff policy shifts and global trade dynamics.”
Shinta cautioned, however, that Indonesia must improve logistics efficiency to fully benefit from the agreement. She added that stronger trade facilitation and export financing would also be needed for businesses seeking to tap into the EAEU’s market of roughly 180 million people.
Aprisindo chairman Eddy Widjanarko said the footwear industry, in particular, sees the deal as an opportunity to expand beyond traditional markets.
“The more we implement this FTA, the bigger the export opportunity,” Eddy said. Jakarta Globe
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After Palm Oil and Nickel, Indonesia Discovers a New Pillar in Gold
Jakarta. After building its global commodity clout on palm oil, coal, and nickel, Indonesia is now making a deliberate push to elevate gold as a new pillar of its economy, anchored by the launch of the country’s first bullion banks and a fully integrated domestic gold-processing capability.Jakarta city guide
The initiative comes at a moment of unusually strong momentum: global gold prices are repeatedly hitting record highs, while Indonesia has, for the first time, achieved the ability to produce fine gold domestically — from raw ore to bullion — following technological advances at Freeport Indonesia’s smelting facilities.
“With the presence of gold banks, Indonesia can build an integrated gold ecosystem from upstream to downstream, where management, storage, financing and trading of gold are conducted entirely within the country,” said Damar Latri Setiawan, president director of state pawnshop firm Pegadaian.
Pegadaian and Bank Syariah Indonesia (BSI) have been designated by the government as the country’s two official bullion service providers. Damar said the development would reduce Indonesia’s reliance on imports of fine gold, a long-standing anomaly for a country with large gold reserves.
Before being designated a bullion bank, Pegadaian’s gold business focused mainly on retail investment. Its gold assets under management have since risen sharply, reaching 132.3 tons as of the end of November 2025, he told the Jakarta Globe.
Pegadaian now offers gold deposits, gold-backed working capital loans, physical gold trading and custodial services for retail and corporate clients. Bullion services at BSI, by contrast, are focused more on religious-related uses, including gold savings products for hajj and umrah expenses.
A Perfect Moment
Domestic gold prices rose sharply in 2025, with gold bars from state-owned miner Aneka Tambang climbing by around Rp 1 million ($60) per gram over the year. Prices rose from Rp 1.52 million per gram on Jan. 2, 2025 to Rp 2.50 million by Dec. 31. Jakarta Globe
--------
Indonesia’s palm oil power only as strong as its sustainability
The future of Indonesian palm oil will be decided by political choices made today, not by the scale of land cleared yesterday
Indonesia’s rise as the undisputed giant of global palm oil has few parallels in the modern commodity economy. No other country has so thoroughly converted a natural comparative advantage, climate suitability, abundant land and an early start in plantation development into such sweeping economic and geopolitical leverage.
Palm oil today underpins millions of livelihoods, fuels a vast ecosystem of smallholders and industrial estates, and anchors Indonesia’s position as the world’s leading producer of crude palm oil (CPO).
Yet the ascent has been accompanied by undeniable ecological costs, and those costs are now mounting in ways that directly threaten the durability of Indonesia’s hard-earned advantage.
At present, Indonesia manages an oil-palm estate of roughly 16 million hectares, a scale unmatched by any other country. Annual output routinely climbs above 55 million tonnes of palm oil products, positioning Indonesia not merely as a major player, but as the global price setter.
Malaysia, once the dominant force, now operates at roughly one-third of that scale, with around five to six million hectares and annual production in the 20 million-tonne range. This asymmetry is not trivial.
When Indonesia tightens or loosens export flows, recalibrates biodiesel mandates, or adjusts its levy structure, markets respond immediately. Refiners, traders, and food producers around the world react to Indonesia’s decisions in ways that reveal the country’s structural influence.
This is precisely the kind of leverage that policymakers dream of a strategic commodity whose flows shape global supply chains and whose pricing power can be used to strengthen diplomatic footing.
But it is also a vulnerability because Indonesia’s dominance depends on a production system increasingly tested by environmental degradation, regulatory gaps and disasters linked to land-use change.
Environmental costs, strategic liabilities
The most recent reminder came in the form of major floods and deadly landslides across multiple Sumatran provinces, West Sumatra, Riau and parts of North Sumatra among them. These incidents were not isolated meteorological flukes.
They were the predictable cumulative effect of watershed disruption: hills stripped of forest cover, river basins clogged with sediment, peatlands drained to make way for plantations, and rainfall patterns that have grown more extreme as regional climates shift. When land loses its natural buffers, rooted vegetation, sponge-like peat soils and intact riparian zones, storms turn into catastrophe rather than manageable hydrological events.
Such disasters expose the underlying paradox of Indonesia’s palm-oil success. The industry delivers profound national benefits. It generates millions of jobs, including an enormous base of independent smallholders. It has lifted the incomes of rural households in Sumatra and Kalimantan, catalyzed infrastructure, fueled domestic biofuel mandates and supplied tens of billions of dollars in export earnings.
But the environmental liabilities threaten to erode those gains from within. Floods destroy roads and plantations, landslides wipe out communities, and haze episodes strain Indonesia’s diplomatic ties, each incident chipping away at the industry’s economic resilience and political legitimacy.
This is where sustainability stops being a moral imperative and becomes a strategic necessity. Indonesia’s national certification scheme, the Indonesian Sustainable Palm Oil (ISPO) system, was designed to institutionalize responsible production.
Yet only a portion of the national estate, various credible tallies place it at roughly one-third, currently holds ISPO certification, with the largest gaps found among smallholders who lack financing, technical support, or clarity on land legality.
That incomplete coverage constrains Indonesia’s ability to defend palm oil in international markets increasingly governed by sustainability thresholds, deforestation regulations, and consumer scrutiny.
For Indonesia to preserve its comparative advantage, ISPO must evolve from an aspirational standard into a universal condition of production. Certification needs to be comprehensive, mandatory and rigorously enforced.
Transparency must improve through accessible concession maps and traceability systems. Smallholder support must be significantly scaled up, with credit instruments, extension services, and land-tenure regularization enabling them to meet standards without being pushed out of the value chain.
At the same time, sustainability alone will not secure Indonesia’s long-term position. The country must accelerate downstream industrialization, shifting from bulk CPO exports toward refined products, oleochemicals, bio-based materials and other high-value derivatives.
his is where comparative advantage transforms into competitive advantage. By exporting more sophisticated products, Indonesia captures a larger share of global value, reduces its exposure to commodity cycles and strengthens its bargaining power in trade negotiations.
Sustainability as statecraft, not compliance
The international dimension is equally critical. A sustainably produced and highly diversified Indonesian palm-oil sector could function as a geopolitical tool in the same manner that Middle Eastern states wield oil, China leverages rare earths or the United States uses semiconductor leadership.
When a commodity is indispensable, and when a single producer can supply it reliably at scale, influence follows naturally. But influence only lasts if reliability is unimpeachable and environmental instability is the enemy of reliability.
The path forward is therefore unmistakable. Indonesia must make sustainability non-negotiable, not because Brussels or Washington demands it, but because the country’s own economic and geopolitical ambitions depend on it. The recent costly, destabilizing and ultimately preventable floods and landslides underscore the stakes.
If Indonesia can rehabilitate degraded landscapes, universalize ISPO and solidify a downstream manufacturing base, palm oil will remain a powerful engine of national progress. Without that commitment, the dual-edged nature of Indonesia’s comparative advantage could turn inward, weakening the very foundation of its global standing.
Indonesia’s future as a palm-oil superpower will be determined not by how much it produces, but by how responsibly, credibly and strategically it does so. At this juncture, the question is no longer whether Indonesia can reform palm oil governance, but whether it is willing to treat palm oil as a long-term strategic asset rather than a short-term source of foreign exchange.
A country that controls close to 60% of global supply does not have the luxury of being reactive. Every governance failure, every recurring ecological disaster will inevitably be read by global markets not as a local aberration, but as evidence of systemic weakness. Ronny Sasmita/ Asia Times
--------
Viewpoint: Japanese firms to advance biocarbon projects
apanese firms are expected to accelerate torrefied or heat-treated biomass, also known as biocarbon, fuel projects from 2026. Torrefied wood pellets have a significantly higher calorific value (CV) compared with typical wood pellets, although the higher CV comes at a higher price.
Japanese energy company Idemitsu is set to carry out full-scale shipments of black pellets in 2026, which are produced at its factory in Vietnam, according to the company. The factory started commercial operations in October 2024 and has 120,000 t/yr of production capacity. The torrefied biomass fuel will be delivered to consumers including Japanese utilities, which are planning to begin coal and black pellet co-firing generation at thermal power plants.
Idemitsu has provided black pellet test products to around 20 customers in Japan so far, including power producers and other industries. It is possible to co-fire 35pc of black pellets with coal, the company said. It aims to expand its production capacity and is considering constructing new factories in Indonesia, Malaysia, and the US, in addition to Vietnam. Idemitsu's final target is 3mn t/yr of total production capacity in the 2030s, using locally secured biomass feedstocks.
Idemitsu's current production capacity of black pellets is insufficient to satisfy potential demand in the future, the company said. A Japanese utility is planning 20pc of black pellet co-firing with coal at its 600MW unit, and another utility is considering 10pc co-firing at its 700MW unit. These two co-firing projects will likely drive several hundreds of thousands of tons of black pellet demand, according to market participants.
Black pellets have a higher CV than normal wood pellets. They have better water resistance and grindability, and can be handled in a similar way to coal without major facility renovations. But black pellets are usually more expensive than coal and typical biomass fuels, at around double the price of wood pellets or even higher, market participants said.
Other projects
A joint venture project led by construction firm Kumagai Gumi and trading house Shinko Shoji is also planning to start producing black bark pellets at a factory, which they are constructing in western Japan's Ehime prefecture, in the fourth quarter of 2026. The factory is designed to have 30,000 t/yr of production capacity, using domestically secured bark materials.
Black bark pellets have a CV of 5,000-6,000 kcal/kg, which is close to coal. The material will be used mainly for coal and biomass co-firing power generation in Japan. Trial products from the project have already been tested at Japanese thermal power plants.
The companies plan to build more black bark pellet factories in Japan, each with a production capacity of 30,000 t/yr. New factories in southeast Asia are also on the cards. The firms have already developed test products made from Vietnamese acacia and conducted trial co-firing combustion with coal at a Japanese thermal power plant, they said.
Steel and metals industry usage
Japanese cast iron firm Aisin Takaoka started producing biocoke from palm kernel shells (PKS) at its factory in Indonesia in December 2025, and will start using the heat-treated biomass fuel in its cast iron melting furnace to replace coking coal in the first quarter of 2026.
The factory, which Aisin Takaoka operates with Indonesian palm oil firm Triputra in the country's West Kalimantan state, currently has 15,000 t/yr of production capacity. The firm aims to increase the capacity of this biocoke project to 90,000 t/yr around 2031 with new factories.
Aisin Takaoka is considering selling around a half of the products to other companies, including automobile, machinery manufacture, and cast iron firms. The other half will be for its own use. The biocoke has similar CV with coking coal and could replace 100pc of coking coal, the company said. Around 3-4t of PKS is needed to produce 1t of biocoke.
Japan's Kobe Steel (Kobelco) is planning to use black pellets in its steelmaking process, in collaboration with cement producer Mitsubishi Ube Cement (MUCC). The companies are expected to set up a joint venture for this project in 2026. MUCC has developed torrefaction technology to produce black pellets.
Kobelco aims to use MUCC's black pellets in steelmaking at its blast furnace in the Kakogawa steelworks. MUCC has a production capacity of 60,000 t/yr in its Ube factory. MUCC's black pellets have been co-fired with coal in its thermal power plant since 2019.
By Takeshi Maeda/ Argus Media
--------
Korean refiners toast a fourth-quarter revival as ‘golden diesel’ eclipses gasoline
The momentum is expected to carry into this year, driven by surging electricity demand from artificial intelligence data centers
South Korea’s oil refiners, reeling from losses that ran into more than 1 trillion won ($694 million) in the first half of 2025, are seen staging a sharp V-shaped recovery as surging diesel margins underpin profits into the final quarter.
KEDGlobal
--------
Incomplete policy, high cost beset Malaysia’s sustainable aviation fuel ambition, says BIMB
KUALA LUMPUR (Jan 2): Malaysia’s sustainable aviation fuel (SAF) ambition is being hemmed in by a lack of policy support and the high cost of production, BIMB Securities flagged.
While the European Union (EU) and the US have binding mandates to scale up the adoption of SAF, Malaysia’s current blending targets are voluntary and aspirational in nature, which risks turning the country into a production hub without parallel domestic use, the research house said in a thematic report.
“Malaysian policies currently lack binding enforcement and clear milestones”, which may delay adoption by domestic airlines, potentially undermining SAF’s competitiveness, BIMB Securities said.
SAF, produced by blending palm oil or used cooking oil with conventional petroleum-based jet fuel, has been identified by the aviation industry as the most significant lever to achieve decarbonisation.
Aviation regulators in the EU mandate that departing flights use at least 2% SAF in 2025 before rising to 20% in 2035 and 70% in 2050. In the US, tax credits are provided as incentives to producers of SAF meeting certain criteria.
Malaysia has also recognised the potential of SAF and set out to produce as much as one million tonnes by 2027.
The primary barrier to SAF adoption, however, is its high cost, estimated at around three times more than that of conventional jet fuel, limiting voluntary uptake by airlines in the absence of subsidies, tax incentives, or blending mandates, BIMB Securities flagged.
“Given the aviation industry’s thin profit margins, this cost differential has limited voluntary adoption, making policy interventions essential,” the research house said. The Edge
New Indonesian FTA Opens Path to $2.56 Trillion Eurasian Trade Bloc
Jakarta. A newly signed free trade agreement with the Eurasian Economic Union (EAEU) is raising hopes among Indonesian exporters that they can reduce their dependence on the US market amid growing protectionism under President Donald Trump.Jakarta events calendar
The Eurasian Economic Union — which includes Russia, Armenia, Belarus, Kazakhstan, and Kyrgyzstan — represents a combined gross domestic product of about $2.56 trillion. Under the Indonesia–EAEU free trade agreement, the bloc will grant Indonesia preferential treatment on 90.5% of its tariff lines.
Trade Minister Budi Santoso has said the agreement would reduce import duties to levels “close to zero,” although he has not disclosed the precise rates.
For exporters, the agreement — which is expected to enter into force by 2027 — could position Eurasia as a viable alternative market to the United States. The Indonesian Employers Association (Apindo) said Indonesia exports broadly similar products to both markets, including footwear, palm oil, and apparel.
These sectors have been affected by Trump’s reciprocal tariffs of 19%, although palm oil is expected to receive an exemption.
“Unlocking the EAEU market can help us diversify apparel and footwear exports,” Apindo chairwoman Shinta Kamdani said. “These capital-intensive products have long relied heavily on the US market. That overdependence has made the sector vulnerable to tariff policy shifts and global trade dynamics.”
Shinta cautioned, however, that Indonesia must improve logistics efficiency to fully benefit from the agreement. She added that stronger trade facilitation and export financing would also be needed for businesses seeking to tap into the EAEU’s market of roughly 180 million people.
Aprisindo chairman Eddy Widjanarko said the footwear industry, in particular, sees the deal as an opportunity to expand beyond traditional markets.
“The more we implement this FTA, the bigger the export opportunity,” Eddy said. Jakarta Globe
--------
After Palm Oil and Nickel, Indonesia Discovers a New Pillar in Gold
Jakarta. After building its global commodity clout on palm oil, coal, and nickel, Indonesia is now making a deliberate push to elevate gold as a new pillar of its economy, anchored by the launch of the country’s first bullion banks and a fully integrated domestic gold-processing capability.Jakarta city guide
The initiative comes at a moment of unusually strong momentum: global gold prices are repeatedly hitting record highs, while Indonesia has, for the first time, achieved the ability to produce fine gold domestically — from raw ore to bullion — following technological advances at Freeport Indonesia’s smelting facilities.
“With the presence of gold banks, Indonesia can build an integrated gold ecosystem from upstream to downstream, where management, storage, financing and trading of gold are conducted entirely within the country,” said Damar Latri Setiawan, president director of state pawnshop firm Pegadaian.
Pegadaian and Bank Syariah Indonesia (BSI) have been designated by the government as the country’s two official bullion service providers. Damar said the development would reduce Indonesia’s reliance on imports of fine gold, a long-standing anomaly for a country with large gold reserves.
Before being designated a bullion bank, Pegadaian’s gold business focused mainly on retail investment. Its gold assets under management have since risen sharply, reaching 132.3 tons as of the end of November 2025, he told the Jakarta Globe.
Pegadaian now offers gold deposits, gold-backed working capital loans, physical gold trading and custodial services for retail and corporate clients. Bullion services at BSI, by contrast, are focused more on religious-related uses, including gold savings products for hajj and umrah expenses.
A Perfect Moment
Domestic gold prices rose sharply in 2025, with gold bars from state-owned miner Aneka Tambang climbing by around Rp 1 million ($60) per gram over the year. Prices rose from Rp 1.52 million per gram on Jan. 2, 2025 to Rp 2.50 million by Dec. 31. Jakarta Globe
--------
Indonesia’s palm oil power only as strong as its sustainability
The future of Indonesian palm oil will be decided by political choices made today, not by the scale of land cleared yesterday
Indonesia’s rise as the undisputed giant of global palm oil has few parallels in the modern commodity economy. No other country has so thoroughly converted a natural comparative advantage, climate suitability, abundant land and an early start in plantation development into such sweeping economic and geopolitical leverage.
Palm oil today underpins millions of livelihoods, fuels a vast ecosystem of smallholders and industrial estates, and anchors Indonesia’s position as the world’s leading producer of crude palm oil (CPO).
Yet the ascent has been accompanied by undeniable ecological costs, and those costs are now mounting in ways that directly threaten the durability of Indonesia’s hard-earned advantage.
At present, Indonesia manages an oil-palm estate of roughly 16 million hectares, a scale unmatched by any other country. Annual output routinely climbs above 55 million tonnes of palm oil products, positioning Indonesia not merely as a major player, but as the global price setter.
Malaysia, once the dominant force, now operates at roughly one-third of that scale, with around five to six million hectares and annual production in the 20 million-tonne range. This asymmetry is not trivial.
When Indonesia tightens or loosens export flows, recalibrates biodiesel mandates, or adjusts its levy structure, markets respond immediately. Refiners, traders, and food producers around the world react to Indonesia’s decisions in ways that reveal the country’s structural influence.
This is precisely the kind of leverage that policymakers dream of a strategic commodity whose flows shape global supply chains and whose pricing power can be used to strengthen diplomatic footing.
But it is also a vulnerability because Indonesia’s dominance depends on a production system increasingly tested by environmental degradation, regulatory gaps and disasters linked to land-use change.
Environmental costs, strategic liabilities
The most recent reminder came in the form of major floods and deadly landslides across multiple Sumatran provinces, West Sumatra, Riau and parts of North Sumatra among them. These incidents were not isolated meteorological flukes.
They were the predictable cumulative effect of watershed disruption: hills stripped of forest cover, river basins clogged with sediment, peatlands drained to make way for plantations, and rainfall patterns that have grown more extreme as regional climates shift. When land loses its natural buffers, rooted vegetation, sponge-like peat soils and intact riparian zones, storms turn into catastrophe rather than manageable hydrological events.
Such disasters expose the underlying paradox of Indonesia’s palm-oil success. The industry delivers profound national benefits. It generates millions of jobs, including an enormous base of independent smallholders. It has lifted the incomes of rural households in Sumatra and Kalimantan, catalyzed infrastructure, fueled domestic biofuel mandates and supplied tens of billions of dollars in export earnings.
But the environmental liabilities threaten to erode those gains from within. Floods destroy roads and plantations, landslides wipe out communities, and haze episodes strain Indonesia’s diplomatic ties, each incident chipping away at the industry’s economic resilience and political legitimacy.
This is where sustainability stops being a moral imperative and becomes a strategic necessity. Indonesia’s national certification scheme, the Indonesian Sustainable Palm Oil (ISPO) system, was designed to institutionalize responsible production.
Yet only a portion of the national estate, various credible tallies place it at roughly one-third, currently holds ISPO certification, with the largest gaps found among smallholders who lack financing, technical support, or clarity on land legality.
That incomplete coverage constrains Indonesia’s ability to defend palm oil in international markets increasingly governed by sustainability thresholds, deforestation regulations, and consumer scrutiny.
For Indonesia to preserve its comparative advantage, ISPO must evolve from an aspirational standard into a universal condition of production. Certification needs to be comprehensive, mandatory and rigorously enforced.
Transparency must improve through accessible concession maps and traceability systems. Smallholder support must be significantly scaled up, with credit instruments, extension services, and land-tenure regularization enabling them to meet standards without being pushed out of the value chain.
At the same time, sustainability alone will not secure Indonesia’s long-term position. The country must accelerate downstream industrialization, shifting from bulk CPO exports toward refined products, oleochemicals, bio-based materials and other high-value derivatives.
his is where comparative advantage transforms into competitive advantage. By exporting more sophisticated products, Indonesia captures a larger share of global value, reduces its exposure to commodity cycles and strengthens its bargaining power in trade negotiations.
Sustainability as statecraft, not compliance
The international dimension is equally critical. A sustainably produced and highly diversified Indonesian palm-oil sector could function as a geopolitical tool in the same manner that Middle Eastern states wield oil, China leverages rare earths or the United States uses semiconductor leadership.
When a commodity is indispensable, and when a single producer can supply it reliably at scale, influence follows naturally. But influence only lasts if reliability is unimpeachable and environmental instability is the enemy of reliability.
The path forward is therefore unmistakable. Indonesia must make sustainability non-negotiable, not because Brussels or Washington demands it, but because the country’s own economic and geopolitical ambitions depend on it. The recent costly, destabilizing and ultimately preventable floods and landslides underscore the stakes.
If Indonesia can rehabilitate degraded landscapes, universalize ISPO and solidify a downstream manufacturing base, palm oil will remain a powerful engine of national progress. Without that commitment, the dual-edged nature of Indonesia’s comparative advantage could turn inward, weakening the very foundation of its global standing.
Indonesia’s future as a palm-oil superpower will be determined not by how much it produces, but by how responsibly, credibly and strategically it does so. At this juncture, the question is no longer whether Indonesia can reform palm oil governance, but whether it is willing to treat palm oil as a long-term strategic asset rather than a short-term source of foreign exchange.
A country that controls close to 60% of global supply does not have the luxury of being reactive. Every governance failure, every recurring ecological disaster will inevitably be read by global markets not as a local aberration, but as evidence of systemic weakness. Ronny Sasmita/ Asia Times
--------
Viewpoint: Japanese firms to advance biocarbon projects
apanese firms are expected to accelerate torrefied or heat-treated biomass, also known as biocarbon, fuel projects from 2026. Torrefied wood pellets have a significantly higher calorific value (CV) compared with typical wood pellets, although the higher CV comes at a higher price.
Japanese energy company Idemitsu is set to carry out full-scale shipments of black pellets in 2026, which are produced at its factory in Vietnam, according to the company. The factory started commercial operations in October 2024 and has 120,000 t/yr of production capacity. The torrefied biomass fuel will be delivered to consumers including Japanese utilities, which are planning to begin coal and black pellet co-firing generation at thermal power plants.
Idemitsu has provided black pellet test products to around 20 customers in Japan so far, including power producers and other industries. It is possible to co-fire 35pc of black pellets with coal, the company said. It aims to expand its production capacity and is considering constructing new factories in Indonesia, Malaysia, and the US, in addition to Vietnam. Idemitsu's final target is 3mn t/yr of total production capacity in the 2030s, using locally secured biomass feedstocks.
Idemitsu's current production capacity of black pellets is insufficient to satisfy potential demand in the future, the company said. A Japanese utility is planning 20pc of black pellet co-firing with coal at its 600MW unit, and another utility is considering 10pc co-firing at its 700MW unit. These two co-firing projects will likely drive several hundreds of thousands of tons of black pellet demand, according to market participants.
Black pellets have a higher CV than normal wood pellets. They have better water resistance and grindability, and can be handled in a similar way to coal without major facility renovations. But black pellets are usually more expensive than coal and typical biomass fuels, at around double the price of wood pellets or even higher, market participants said.
Other projects
A joint venture project led by construction firm Kumagai Gumi and trading house Shinko Shoji is also planning to start producing black bark pellets at a factory, which they are constructing in western Japan's Ehime prefecture, in the fourth quarter of 2026. The factory is designed to have 30,000 t/yr of production capacity, using domestically secured bark materials.
Black bark pellets have a CV of 5,000-6,000 kcal/kg, which is close to coal. The material will be used mainly for coal and biomass co-firing power generation in Japan. Trial products from the project have already been tested at Japanese thermal power plants.
The companies plan to build more black bark pellet factories in Japan, each with a production capacity of 30,000 t/yr. New factories in southeast Asia are also on the cards. The firms have already developed test products made from Vietnamese acacia and conducted trial co-firing combustion with coal at a Japanese thermal power plant, they said.
Steel and metals industry usage
Japanese cast iron firm Aisin Takaoka started producing biocoke from palm kernel shells (PKS) at its factory in Indonesia in December 2025, and will start using the heat-treated biomass fuel in its cast iron melting furnace to replace coking coal in the first quarter of 2026.
The factory, which Aisin Takaoka operates with Indonesian palm oil firm Triputra in the country's West Kalimantan state, currently has 15,000 t/yr of production capacity. The firm aims to increase the capacity of this biocoke project to 90,000 t/yr around 2031 with new factories.
Aisin Takaoka is considering selling around a half of the products to other companies, including automobile, machinery manufacture, and cast iron firms. The other half will be for its own use. The biocoke has similar CV with coking coal and could replace 100pc of coking coal, the company said. Around 3-4t of PKS is needed to produce 1t of biocoke.
Japan's Kobe Steel (Kobelco) is planning to use black pellets in its steelmaking process, in collaboration with cement producer Mitsubishi Ube Cement (MUCC). The companies are expected to set up a joint venture for this project in 2026. MUCC has developed torrefaction technology to produce black pellets.
Kobelco aims to use MUCC's black pellets in steelmaking at its blast furnace in the Kakogawa steelworks. MUCC has a production capacity of 60,000 t/yr in its Ube factory. MUCC's black pellets have been co-fired with coal in its thermal power plant since 2019.
By Takeshi Maeda/ Argus Media
--------
Korean refiners toast a fourth-quarter revival as ‘golden diesel’ eclipses gasoline
The momentum is expected to carry into this year, driven by surging electricity demand from artificial intelligence data centers
South Korea’s oil refiners, reeling from losses that ran into more than 1 trillion won ($694 million) in the first half of 2025, are seen staging a sharp V-shaped recovery as surging diesel margins underpin profits into the final quarter.
KEDGlobal
--------
Incomplete policy, high cost beset Malaysia’s sustainable aviation fuel ambition, says BIMB
KUALA LUMPUR (Jan 2): Malaysia’s sustainable aviation fuel (SAF) ambition is being hemmed in by a lack of policy support and the high cost of production, BIMB Securities flagged.
While the European Union (EU) and the US have binding mandates to scale up the adoption of SAF, Malaysia’s current blending targets are voluntary and aspirational in nature, which risks turning the country into a production hub without parallel domestic use, the research house said in a thematic report.
“Malaysian policies currently lack binding enforcement and clear milestones”, which may delay adoption by domestic airlines, potentially undermining SAF’s competitiveness, BIMB Securities said.
SAF, produced by blending palm oil or used cooking oil with conventional petroleum-based jet fuel, has been identified by the aviation industry as the most significant lever to achieve decarbonisation.
Aviation regulators in the EU mandate that departing flights use at least 2% SAF in 2025 before rising to 20% in 2035 and 70% in 2050. In the US, tax credits are provided as incentives to producers of SAF meeting certain criteria.
Malaysia has also recognised the potential of SAF and set out to produce as much as one million tonnes by 2027.
The primary barrier to SAF adoption, however, is its high cost, estimated at around three times more than that of conventional jet fuel, limiting voluntary uptake by airlines in the absence of subsidies, tax incentives, or blending mandates, BIMB Securities flagged.
“Given the aviation industry’s thin profit margins, this cost differential has limited voluntary adoption, making policy interventions essential,” the research house said. The Edge
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