Dream of The Downstream

10 December 2014 , 06:26 WIB | Read : 1031 | By : Ignatius Ery Kurniawan

the development of palm oil downstream industries which the government always commands seems to be long. it happens for palm oil downstream industries should be integrated. and this dream will be difficult to realize.

Utopia, as nowadays language used by the youths may be a picture to the development of palm oil downstream industries since 1960. There were lots of plans which the government did but there were few to realize.

Though it has been in the cluster industrial developmental plan since 2011, the downstream palm oil industries, such as, oleochemical and biodiesel have less meaning.

Based on what InfoSAWIT has traced, palm oil downstream industries for such a long time have been dominated by refinery ones which are widespread in the major cities in Indonesia. Actually, refinery is not one of downstream palm oil industries but intermediate one which makes cooking oil.

The side products of refinery, such as, palm fatty acid distilate (PFAD)and palm stearin are used as the material in the downstream industries, such as, oleochemical and biodiesel. The both still use crude palm oil (CPO) as the materials. That is why oleochemical and biodiesel become obscure because of the fluctuative price.

According to Executive Director of Indonesian Vegetable Oil Industries Association, Sahat Sinaga, the CPO export markets tend to decrease because of the decreasing demand. But on the other hand, the other kinds of vegetable oil, such as, rapak, sunflower and soybean, tend to increase. “They are not domestic problems,” Sahat explained.

The goal of CPO export markets tends to postpone, such as, India which runs the import tax to the downstream product. It can be seen in the export product in September than in August 2014 which decreased about 4% - 5%.

In the domestic, there are also some regulations which postpone the exports. The regulation in tax, for instance. There are lots of HS which should have the Out Fee. This makes the businessmen tend to do export in CPO. But last year, the composition of export was 60% in the downstream, and 40% in upstream. This nowadays condition is 55% in the downstream, and 45% in the upstream.

“The tax probem because of HS number needs to be re-clarified so the HS number is clearly explainable,” Sahat explained.

He also said, it needs some . . .


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