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Patchouli oil is a type of oil obtained from the extraction of patchouli leaves and dried stems. In this study, the extraction process, also known as distillation, is conducted by Small and Medium Enterprises (SMEs) in West Pasaman, Indonesia. Patchouli oil must go through several steps before being by manufacturers, such as farmers, intermediaries, collectors. The interview and survey conducted show that SMEs are currently declining in West Pasaman due to the low selling price of patchouli oil while the production cost is high that declined farmers. Most traders do not add value to the product as they only collect patchouli oil and pass it on to next stages. This study aims to determine the production cost and profit margin of each stage in the supply chain of patchouli oil. Data were collected by interviewing the stakeholders, i.e., patchouli farmers, SMEs refining patchouli oil, collectors, and exporters. The production cost determined using traditional costing method. The results indicate that farmers obtain IDR 1.236 per day, while traders and collectors obtain respectively IDR 10.000 and IDR 3.833 a day. Surprisingly, the intermediary traders obtain the highest profit margin although they do not contribute to the added value of the product.

As the country's largest palm oil producer in the world, Indonesian palm oil production is still encounter political barriers or non-tariff economy of several countries. Sustainable development policies have a role to overcome these obstacles. The research problem is how to build policies through the performance based risk assessment for sustainable palm oil supply chain in Indonesia. The research objective is to recommend policies that supported by performance-based risk assessment models for sustainable palm oil supply chain in Indonesia. Performance-based risk assessment algorithms have been developed and verified in a comprehensive manner. Model verification is conducted by analyzing the performance of crude palm oil supply chain based on expert's analysis. This study has obtained the necessary indicators to assess the risk based on performance of sustainable crude palm oil supply chain. Model application has shown that risk level of sustainable crude palm oil in Indonesia relating to economics, environmental, and social aspects are moderate, respectively. However, there are some indicators that need to be considered with the level of risk is quite high, namely demand rate, quality of palm oil, timelines of product delivery, availability of crude palm oil and bullwhip effect. This paper has recommended some policies to address those risks.

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ABSTRAK Pengembangan agroindustri kelapa di sentra daerah penghasil kelapa masih perlu ditingkatkan. Hal ini disebabkan karena masih banyaknya petani kelapa yang masih bertahan dengan tradisi lama, yaitu menjual kelapa bulat tanpa mengolahnya terlebih dahulu. Salah satu strategi pengembangan adalah dengan menentukan daerah potensial untuk pengembangan agroindustri tersebut. Penelitian ini bertujuan untuk menentukan daerah potensial atau daerah yang prospektif untuk pengembangan agroindustri kelapa. Kriteria yang digunakan adalah jumlah penduduk, luas areal, jumlah produksi, dan jumlah petani kelapa. Sedangkan alternatif adalah mencakup semua daerah penghasil kelapa. Lokasi penelitian dilakukan di kabupaten Indragiri Hilir, yang terdiri atas 20 daerah penghasil kelapa,