Issue and Solutions Palm Oil Industry in Indonesia Yudi Ferrianta* Department of Agribusiness, Lambung Mangkurat University, Indonesia Submission: March 11, 2017; Published: March 24, 2017 * Corresponding author: N Yudi Ferrianta, Department of Agribusiness, Faculty of Agriculture, University ofLambung Mangkurat, Jl A Yani Km 34, Banjarbaru, 70714, Indonesia, Email: Introduction Based on data from Oil World, the trend of the use of palm oil- based commodities in the global market is increasing from time to time beating industry vegetable oil-based commodities such as wheat germ oil, corn oil, and coconut oil. Since 2004 the use of palm oil commodities have occupied the highest position in the world vegetable oil markets, reaching approximately 30 million tons with an average growth of 8% per year, outperforming commodity soybean oil about 25 million tons with an average growth of 3.8% per year. Other commodities that are widely used are sunflower oil at around 11.5 million tonnes with an average growth of 2.2% per year [1]. Indonesia as one of the chief producers of oil has already mastered 37% of the world market, the trend of export-import balance, land area, and the number of positive production. During the period 2008-2016 the export volume of palm oil from Indonesia is increasing from 15.1 tons in 2016 became 27.0 tonnes with an export value of 18.6 billion USD. The export volume is quite large is supported by an adequate land area and production is quite high [2,3]. According to data from the Indonesian Ministry of Agriculture the total area of oil palm plantations in Indonesia is currently around eight million hectares; a number which is twice as much as in the year 2000 when around four million hectares of Indonesian soil was used for palm oil plantations [4]. This number is expected to increase to 13 million hectare by 2020. State-owned plantations play a modest role in the Indonesian palm oil industry as big private enterprises produce approximately half of total Indonesian production. Smallholder farmers account for around 35 percent, most of whom are highly vulnerable to global downswings in palm oil prices. Solutions Based on existing data, CPO demand for food until the upcoming 2010 reached 10.5 million tons, while the demand for biofuels nonfood 2.3 million tons, including for biofuels amounted to 2 million tons, equivalent to 2.13 million kiloliters, Currently, the productivity of palm oil in Indonesia is still low low at 2-3 tons per hectare way below Malaysia 4-6 tonnes per ha. So the need to boost farm productivity, among others by developing research nursery to get a quality oil. Increased productivity can be done with research and breeding in integrated and carried through the revitalization of plantations because today most of the age of oil palm have been classified as old [5-7]. In order to improve the efficiency of the performance of the palm oil industry it is necessary to ease licensing by taking into account environmental factors, it is very important for the palm oil industry is vulnerable to environmental issues [8]. Encourage the development of integrated port and has raised over investments, idle capacity and inefficiency. Encouraging the growth of downstream industries to increase the added value such as edible oil, oleo chemicals, biodiesel, surfactant increasing Agri Res & Tech: Open Access J 5(2): ARTOAJ.MS.ID.555656 (2017) 0019 Mini Review Volume 5 Issue 2 - March 2017 DOI: 10.19080/ARTOAJ.2017.05.555656 Agri Res & Tech: Open Access J Copyright © All rights are reserved by N Yudi Ferrianta Abstract Indonesia is one of the chief producers of oil has already mastered 37% of the world market. While having a positive development in the production of palm oil, Indonesia is often receive negative issues against the palm oil industry such as the destruction of forests and biodiversity, food security and agrarian conflicts and natural resources. But some solutions can be done is to develop a research nursery to get a quality oil. Encourage the development of integrated port and the growth of downstream industries. Encourage the revitalization of the fertilizer industry to support the supply needs of the palm oil industry. As well as the spatial policy and the formulation of rules relating to the management of agricultural and natural resources. Keywords: Palm oil industry; Issue; Solutions; Indoensia