REPUBLIKA.CO.ID, MAMUJU - About 3.7 million people in Indonesia lived on oil palm plantations, a senior agriculture ministry said. Indonesia is the world`s largest crude palm oil (CPO) producer with an annual production of 25.5 million tonnes.

Speaking to a seminar at Santika Hotel here on Friday, Secretary of the Directorate General of Agriculture Mukti Sardjono said that oil palm played an important role in providing income for the people. He said it also served as an important factor for the expansion of regional development because more than 3.7 million people were employed in this sector. 

Palm oil, according to Mukti, is also an important source of state revenue as it serves a source of income from non oil/non gas exports. The value of palm oil exports is bigger than that of other agricultural product exports.

"In 2012, palm oil exports contributed 28.3 trillion IDR in export tax to the state so that this commodity has an important role in supporting the development of industry at home," Mukti said.

Therefore, he said, the palm oil industry should continue to be supported so that it would develop rapidly. In 2011 Indonesia`s exports of CPO derivative products were recorded at 9,026 tonnes while CPO at 7,646 tonnes but in 2012 they respectively rose to 10,964 tonnes and 5,592 tonnes, he said.

The CPO industry had recorded a good performance in 2011 when palm oil production increased by 7.3 percent, reaching 23.5 million tonnes, of which 16.5 million tonnes were exported.

The Indonesian government hopes 70 percent of its crude palm oil production could be processed at home. "The target is 65 to 70 percent of production which could be processed at home this year," the director general of agro-industry, Benny Wachjudi, said recently.

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