Asian Agri has achieved our goal of matching each hectare of our own plantations with one owned by smallholder farmers under our One to One Partnership program.
Under the program, first announced in 2017, we committed to partnering with smallholders responsible for 60,000 hectares under the government’s Plasma smallholder scheme, and another 40,000 hectares owned by independent smallholders.
In December 2018 we reached 101,000 hectares, actually surpassing the 100,000 hectares of our own land.
Partnering with smallholders enables us to help them boost their production sustainably, benefitting the environment, increasing their income, and ensuring a reliable supply.
Partnership as a business model
Partnership with smallholders has been the core of the company’s business model for decades, beginning in 1987, when we became one of the first companies to join the Indonesian government’s Plasma Transmigration Program.
The partnership scheme provides assistance for smallholders, including supplying quality seeds and training. When oil palms reach the end of their productive life at around 25 years of age, we also assist with the replanting process, including helping farmers find alternative sources of income until their new trees yield fruit.
The One to One Commitment has seen the smallholders improve their welfare while starting to implement the principles of sustainability.
Earning sustainability certification can be challenging for smallholders who may lack the resources required to complete the process. With Asian Agri’s assistance, Plasma smallholders responsible for 60,000 hectares of plantations have gained certification from the Roundtable on Sustainable Palm Oil (RSPO), as well as International Sustainability & Carbon Certification (ISCC).
Those benefits are now being spread to independent smallholders, with Asian Agri assisting Amanah Independent Smallholders Association in Ukui, Riau, to become the first smallholder association in the country to achieve Indonesian Sustainable Palm Oil (ISPO) and RSPO certification.
The company’s partnership scheme has helped its smallholder partners improve productivity through modern farming methods and through the use of the company’s own high-yielding Topaz seeds. That was recognized in 2018 when Petapahan Maju Bersama, an independent smallholders association, was awarded the prize in the Smallholder’s Plantation Productivity category by President Joko Widodo at the 14th Indonesian Palm Oil Conference.
Using Topaz seeds, the farmers were able to achieve an average yield of 22.16 tons/ha per year during the January to September assessment period, and their estimated productivity is expected to reach 30 tons/ha per year at the end of the year, compared to an average for smallholders of 14-15 tons/ha per year on average.
Also in 2018, Asian Agri helped 135 members of Mulus Rahayu village cooperative carry out the first harvest of their oil palm plantations following replanting using Topaz seeds in 2016.
According to the head of KUD Mulus Rahayu, Pawito Saring, the partnership with Asian Agri eased the smallholders’ worries about replanting.
They were followed by Anugerah Jaya Mandiri Sejahtera village cooperative, the first smallholder association in North Sumatra to successfully complete the replanting program.
The next question that emerges after achieving a commitment is “what’s next?” and the answer is: to exceed the achievement.
We intend to partner with more smallholder farmers, and to continue to help them improve their sustainability and increase their livelihoods. That helps spread sustainable palm oil while helping Indonesian smallholders to achieve prosperity.