Palm Oil (Crude Palm Oil/ CPO)
Is a breakthrough renewable energy, why do so because CPO can be used and converted into various oil as energimaupun food needs, among others, can be made needs such as cooking oil, margarine, and even biodiesel as fuel.
Palm oil is one of the oil most widely consumed and produced in the world. Oil is cheap, easily manufactured and highly stable is used for a variety of foods, cosmetics, hygiene products, and also can be used as a source of biofuel or biodiesel. Most palm oil is produced in Asia, Africa and South America because of the oil palm tree requires warm temperatures, sunshine and heavy rainfall to maximize production. The negative side effects of palm oil production - in addition to their impact on human health because they contain a high fat content - is the fact that the palm oil business into a key cause of deforestation in countries like Indonesia and Malaysia. Indonesia is the largest greenhouse gas emissions after the People's Republic of China (PRC) and the United States (US).
World palm oil production is dominated by Indonesia and Malaysia. Both of these countries have a total yield of about 85-90% of total world palm oil production. At this time, Indonesia is a producer and exporter of palm oil in the world's largest.
In the long term, world demand for palm oil showed a tendency to increase as the number of the world's population is growing and therefore increase the consumption of products with palm oil feedstock.
Expectations Production of Palm Oil 2014:
1. Indonesia 33,000,000
2. Malaysia 19,800,000
3. Thailand 2,000,000
4. Colombia 1,108,000
5. Nigeria 930,000
in metric tons
Source: Index Mundi
PALM OIL IN INDONESIA
Production and Export of Palm Oil in Indonesia
Only a few industries in Indonesia which show the development as soon as the palm oil industry in the last 15 years. Growth is evident in production and exports from Indonesia and also the growth of oil palm plantation area. Driven by the global demand continues to rise and profits also rose, oil palm cultivation has been significantly improved by both small farmers and large employers in Indonesia (with a negative impact on the environment and decrease the amount of production of other agricultural products, as farmers switch to the cultivation of oil palm).
The majority of the results of Indonesia's palm oil production is exported (see table below). Countries most important export destinations are China, India, Malaysia, Singapore, and the Netherlands.
Production and Export of Crude Palm Oil Indonesia:
Source: Indonesian Palm Oil Producers Association (Gapki) and Indonesian Ministry of Agriculture.
Industrial Industrial plantations and palm oil processing industry is key to Indonesia's economy: exports of palm oil is an important foreign exchange earner and this industry gives millions of people the opportunity kerjabagi Indonesia. Nearly 70% of oil palm plantations located in Sumatra, where this industry started since the Dutch colonial period. Most of the rest - about 30% - were on the island of Borneo.
1. Sumatra
2. Kalimantan
According to data from the Ministry of Agriculture of Indonesia, a total area of ??oil palm plantations in Indonesia currently reaches approximately 8 million hectares; a doubling of the area in 2000 when about 4 million hectares of land in Indonesia is used for oil palm plantations. That number is expected to increase to 13 million hectares in 2020.
Government-owned plantations have a secondary role in the palm oil industry while large companies (like Wilmar and Sinar Mas Group) produces about half of the total palm oil production in Indonesia. Small-scale farmers produce about 35% and most small farmers are extremely vulnerable situation when a decline in the world price of crude palm oil.
Palm oil companies in Indonesia are planning to undertake major investments to increase oil refining capacity. This is consistent with the Government's ambition to get more income from domestic resources. Indonesia has been focusing on the export of crude palm oil (and other raw materials), but has changed his priorities for the processing of its products in order to have a higher selling price. To improve the development in downstream industries, export taxes for palm oil products refined has been cut in recent years. Meanwhile, the export tax on crude palm oil (CPO) is between 0% -22.5% depending on the price of international crude oil. Indonesia has the 'automatic mechanism' so that when the price of CPO benchmark Government (based on local and international CPO prices) fell below 750 US dollars (US) per metric ton, the export tax was cut to 0%. Because the reference price falls below 750 dollars per metric ton in September 2013, Indonesia has set the CPO export tax of 0% since October 2014.
Because it means the government loses tax revenue badly needed export of palm oil industry, the Government decided to introduce levies palm oil exports in mid-2015 levy of 50 United States dollars (US) per metric ton is applied to exports of crude palm oil and levies worth 30 US dollars per metric ton is set for the export of products refined palm oil. Levies exports of palm oil only needs to be paid by the exporter when the CPO price falls below the reference limit government 750 dollars per metric ton (effectively cut the palm oil export tax to 0%). Revenues from the new levy will be used to fund the subsidy program biodiesel ambitious government (in 2014, the Government increased content requirement mixture of palm oil in diesel from 7.5% to 10%, and ordered power plants to use a mixture of 20% ).
In February 2015, the Government announced an increase in biofuel subsidies of Rp 1,500 per liter to Rp 4,000 per liter in an effort to protect domestic biofuel producers. Through this biodiesel program, the Government compensate the producers because the price difference between regular diesel and biodiesel that occurs due to lower crude oil prices (since mid 2014). In addition to fund these subsidies, export levies a result of this will be channeled to replanting, research, and development of human resources in the Indonesian palm oil industry. When the benchmark palm oil prices exceed the government limit of 750 US dollars per metric ton, the export tax return, then the government will use a portion of the palm oil export tax to finance this biodiesel program.
Refining capacity in Indonesia is known to have jumped to 45 million tons per year by the end of 2014, up from 30.7 million tons in 2013, and more than doubled its capacity in 2012 is 21.3 million tons.
Indonesian Palm Oil Association (Gapki) states that Indonesia has a long-term target to produce 40 million tons of CPO per year starting from 2020.
Environmental Issues Oil Palm Plantations in Indonesia
The Indonesian government has been criticized often groups of environmentalists as too little room for oil palm plantations (impact on deforestation and destruction of mangrove lands). Then, as more international companies are looking for sustainable palm oil in accordance with the criteria of the Roundtable on Sustainable Palm Oil (in Malaysia), plantations in Indonesia and the Government needs to develop environmentally friendly policies. The governments of Western countries have made the rules stricter law concerning imported products that contain palm oil, and therefore encourages the production of palm oil is environmentally friendly.
In 2011, Indonesia founded the Indonesian Sustainable Palm Oil (ISPO) which aims to increase the global competitiveness of palm oil in Indonesia and set rules more stringent environmental friendly. Palm oil producers in Indonesia were encouraged to obtain certification ISPO.
Moratorium On New Forest Concession Virgin
The Indonesian government signed a two-year moratorium on the term of primary forest which took effect May 20, 2011 and was completed in May 2013. The validity period after it expires, Indonesian President Susilo Bambang Yudhoyono to extend the moratorium to the next two years. This implies the suspension of the moratorium on granting new licenses to use the area of ??tropical rain forest and mangrove land in Indonesia. Instead Indonesia received the package 1 billion from Norway. On several occasions, the international media reported that the moratorium has been violated by Indonesian companies. Nevertheless, it managed to limit the moratorium - for a while - the expansion of oil palm plantations. The parties are skeptical of the moratorium prior to its application shows that the Indonesian government has granted concessions for 9 million hectares of land for new land. In addition, large corporations palm oil are still large areas of land only half planted, there is still plenty of room for expansion. In May 2015, President Joko Widodo back to extend the moratorium for a period of 2 years.
Future Prospects in Indonesia Palm Oil Industry
Commodity Boom Era of the 2000s brought blessing to Indonesia because of the abundance of natural resources of this country. Palm oil prices rose sharply after 2005, but the global crisis led to a sharp decline in CPO prices in 2008. There was a strong rebound in 2011, but after the price of CPO has weakened, mainly due to demand from China has declined, while the low price of crude oil (since mid-2014 ) reducing the demand for biofuels made from palm oil. Therefore, the gloomy prospect of the palm oil industry in the short term, especially since Indonesia is still too dependent on CPO than products processed palm oil.
At the time of strong global demand, the palm oil business in Indonesia advantageous for the following reasons:
• a large profit margin, while the commodity is readily produced
• International demand is huge and continues to grow as the global population increase
• The cost of production of crude palm oil (CPO) in Indonesia is the cheapest in the world
• The level of productivity that is higher than vegetable oil products
• The use of biofuels is expected to increase significantly, while the use of besin estimated to be reduced
What problems that hinder the development of the world's palm oil industry?
• The realization that it is important to make more eco-friendly policy
• Conflicts land issue with the local population because of lack of land ownership
• Unclear laws and legislation
• logistics costs are high due to the lack of quality and quantity of infrastructure
What Five Factors Affecting Prices Palm Oil?
(1) supply & demand
(2) prices of competing vegetable oils
(3) weather
(4) The import policy negara2 importing palm oil
(5) changes in tax policy and levies export / import
