Roles of Actors in Palm Oil Value Chain: a Paradox

Abstract

Process of globalization has added pressure to smallholder palm oil in world palm oil producers countries. The globalization, however, create opportunities for small palm oil holders to benefit from it whenever they are able to collaborate proportionally with other actors. In order to do so, this study is aimed to elaborate the current value chain and typology of smallholders to establish the suitable collaboration schema. The finding showed that although there is imperfect quality of role, the variety of actors involved make smallholders found a better role. The PTPN VIII Kertayaja (State-Owned Enterprises (SOE) should be able to gain benefit and opportunities from suggestion use of the collaboration with other actors within the value chain. However, it is the role of SOE that act as state fiscal-revenue collector as well as maintaining status quo and having coercive power but it makes them complacent it and neglect to achieve sustainability role in empowering farmers. On the other hand, willingness to maximize the benefits created from the transaction has led head of village, private enterprises, collectors, sellers and transporters to find the most innovative way to help the small plantation owner to ease the challenges and maximize their roles in adding value to the chain. INTISARI Proses globalisasi telah menambah tekanan pada petani kecil di negara-negara produsen minyak sawit dunia. Akan tetapi, globalisasi menciptakan peluang bagi pemegang minyak sawit kecil untuk mengambil manfaat situasi tersebut jika mereka dapat berkolaborasi secara proporsional dengan aktor-aktor lain. Penelitian ini bertujuan untuk menguraikan rantai nilai saat ini dan tipologi petani kecil untuk membangun skema kolaborasi yang sesuai. Temuan ini menunjukkan bahwa meskipun peran yang tidak sempurna, berbagai pelaku yang terlibat membuat petani kecil menemukan peran cukup baik. Disamping itu peran Badan Usaha Milik Negara (BUMN), PTPN VIII Kertayaja harus dapat memperoleh manfaat dan peluang dari penggunaan kolaborasi yang bijak dengan aktor-aktor lain dalam rantai nilai. Namun, peran BUMN yang bertindak sebagai pengumpul pendapatan fiskal negara serta mempertahankan status quo dan tetap menggunakan kekuatan coercive yang menghambatnya untuk mencapai peran keberlanjutan. Di sisi lain, aktor-aktor yang berpengaruh seperti kepala desa, perusahaan swasta, pengumpul, penjual dan pengepul menemukan cara inovatif untuk membantu pemilik perkebunan kecil untuk meringankan tantangan dan memaksimalkan peran mereka meningkatkan manfaat dalam jaringan mata rantai sektor kelapa sawit.

Should Network Governance Shape the Collaboration? A Case in Indonesia’s Palm Oil Industry

“…Since then, their domination over the CPO has not been able to be reversed, the domestic investor has always been the minority and could not control the CPO industry in Indonesia. However, Soeharto also established a good state the art of policy by demanding the SOE to provide financial support of seedlings, fertilizer and water supply to the "forced" small holder to plant the palm oil in their land [9]. The author also described the term forced is used since the small-owner had no choice but to plant palm oil to supply of SOE input in their land (less than 0.5 hectares).…”

Governing the sustainable palm oil value chain: roles of public and private actors in Thailand

“…The growing number of global voluntary private governance standards developed in consuming countries to promote sustainable products has an increasing and significant impact in producing countries, including palm oil Schleifer & Sun, 2018;Tey et al , 2021) . Many scholars have reviewed the impact of global standards on developing country producers (Ortega & Tschirley, 2017;Hidayati et al, 2019;Rodthong et al, 2020). Certification schemes, labelling, and branding are the main instruments that consumers use to decide on purchasing sustainable products, especially in the global North.…”

“…Therefore, a global standard such as the RSPO is adding pressure to the palm oil sector in producer countries. By the same token, the RSPO as the only global certification scheme in the palm oil sector is expected to be beneficial in the long term by increasing monetary value and promoting best farm management practices, such as creating jobs, contributing to domestic production, promoting sustainable oil palm plantation management ( Salman et al , 2017) , and creating opportunities for smallholders to collaborate with other actors in the global market (Hidayati et al, 2019). However, international standards established at the global level need to critically consider their impacts at the local level.…”