The implementation of the 50 percent blend biodiesel fuel policy, or B50, taking effect on July 1, 2026, brings renewed optimism to the plantation industry in East Kalimantan. This national strategic policy is projected to absorb smallholder palm oil production on a large scale, while serving as a crucial instrument in maintaining Fresh Fruit Bunch (FFB) price stability at the farmer level.
Acting Head of the East Kalimantan Plantation Office, Ahmad Muzakkir, revealed that his region possesses a highly potential production base. Currently, there are approximately 225,000 hectares of smallholder palm oil plantations with a total production reaching 741,000 tons of FFB per year. This figure is supported by 108 Palm Oil Mill (POM) units spread across East Kalimantan, ready to process Crude Palm Oil (CPO) as raw material for national biodiesel.
Muzakkir added that the provincial government will continue to oversee the distribution process and implementation mechanisms of this policy alongside the private sector. The government's primary focus is not limited to production volume, but also ensuring price protection for farmers. This measure is pursued through the periodic setting of benchmark FFB prices so that selling prices at the farmer level remain competitive and protected from unhealthy market volatility.
Currently, FFB prices in East Kalimantan are recorded at around IDR 3,400 per kilogram. Local government hopes that with the increased demand for biodiesel raw materials through the B50 program, this price trend will continue to strengthen. Synergy between the government and the private sector is key to ensuring that the economic impact of this policy can be directly felt by smallholder farming communities across East Kalimantan.
