Managing Sustainable Oil Palm Plantations

Sustainable Palm Oil Plantations in Indonesia


Asian Agri has 28 oil palm plantations located in the provinces of Riau, Jambi and North Sumatra totaling 100,000 hectares. The company also partners Plasma scheme and independent smallholders who respectively manage 60,000 ha and 41,000 ha of estates. With the first estate dating back to more than 30 years ago, Asian Agri has developed an integrated strategy aimed at producing and processing palm oil products, by taking advantage of a wide range of natural conditions that make Indonesia one of the most ideal palm oil producing regions in the world. This tropical plant thrives at about 10 degrees north and south of the equator, and Indonesia complements this location with fertile soil and an abundant workforce.

Fresh Fruit Bunches (FFB) are harvested 30 months after planting, depending on the variety of the oil palm. Yields typically increase sharply by the eighth year, stabilizing in the following five years. After the 15th year, the harvest will gradually decline, and after 25 years, oil palms trees enter their “replanting” period. Currently, some of our estates in North Sumatra are being replanted using mechanical equipment in accordance with our strict zero-burning policy.

A key aspect in our strategy is to also work with 11 smallholder and KKPA estates. Palm oil production requires a direct approach. In order to produce economically, estates require high capability, proper management and a disciplined and trained workforce. In addition to providing economic benefits to the region, these activities also provide employment for thousands of families who would otherwise still depend on agricultural produce that use slash and burn techniques.