"The main objective of this program is to increase the income and welfare of smallholders while utilizing around 2 million hectares of potential plantation land," BPDPKS executive director Eddy Abdurrachman said at the 19th Indonesia Palm Oil Conference and 2024 Price Outlook, here on Thursday.
The PSR program has made significant progress in recent years, with at least Rp8.5 trillion (US$536 million) in funds distributed for more than 306 thousand hectares of land, benefiting more than 134 thousand smallholders, he informed.
Through the program, more than 200 thousand hectares of palm plantation land has been replanted, and over 100 thousand hectares is in the process of being cleared.
A smallholder will get Rp30 million (around US$1,850) per hectare under the replanting program, Abdurrachman said.
"This program not only addresses the financial gap, but also facilitates farmers' access to markets," he underlined.
He further said that cooperation with various stakeholders, such as ministries, local governments, co-operatives, and private companies is essential in implementing the PSR program.
"The sustainability of this program is an urgent matter. Program participants are encouraged to obtain Indonesian Sustainable Palm Oil (ISPO) certification at the time of the first harvest," he added.
According to him, the obligation to implement ISPO reflects environmental awareness and ethical considerations in palm oil production.
He said that the PSR program has gone through several different phases and has been adjusted to market demands and regulatory changes.
"Although this program has brought economic benefits, there are still challenges. One of the main problems is the financial gap between the distribution of replanting funds and the production phase, which discourages smallholders from participating," he added.
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