Inclusive and Sustainable Smallholdings in Palm Oil Supply Chain: Indonesian Case Studies

Identifying “hot spots” within the value chain in which interventions have the greatest potential to improve the environmental and social impact of the system as a whole is a crucial first step. Smallholders are often seen as the weakest part in the palm oil supply chain. The lack of technical, financial and managerial competence causes them to be excluded throughout the improvement process. In the process of improving the value chain, smallholders receive the least benefits. At the same time, their shares are always increasing, rendering them as an important element for significant changes.

Therefore, they can be seen as the “hot spot” of the palm oil value chain. It should be noted that sustainability should not solely focus on the operation of the supply chain but also on the involvement of the actors, from growers to end consumers. Therefore, this book will focus on the inclusivity and sustainability of smallholdings in the palm oil supply chain. Twelve empirical cases are chosen as an effort to show a comprehensive point of view on smallholder inclusivity. All studies were conducted in Indonesia, which is recorded as the biggest palm oil producer and exporter in the world. It is expected that the findings will provide a more grounded insight for those interested and involved in the palm oil industry, and will hopefully leave a positive impact on the livelihood of oil palm smallholders.

Diana Chalil and Riantri Barus