Nine Breakthrough Ideas for Sustainable Palm Oil Win Competition to Empower Smallholder Farmers
International Entrepreneurs Will Pitch Solutions to Palm Oil Leaders in Jakarta in November
October 12, 2016
Jakarta – Nine innovators with breakthrough solutions to help Indonesia’s smallholder farmers produce sustainable palm oil have been chosen out of a pool of more than 70 international applicants to pitch their ideas to leaders in business, forest conservation, international development and government. Hailing from Indonesia, the United States, the Netherlands and Singapore, the SAWIT Challenge finalists will present their proposals to organizations including Bank Mandiri, Golden Agri Resources, Cargill, KEHATI, Mondelez, Olam, and World Resources Institute in Jakarta November 17 and 18.
Palm oil is critical to Indonesia’s economy and provides income for many people living in poverty, including independent smallholder farmers. Smallholder palm oil farmers represented 42 percent of the Indonesian market in 2014, and are predicted to reach 50 percent in 2020, overtaking the projected corporate share of 45 percent. Smallholders will continue to play a significant role in the palm oil industry and are well-positioned to implement solutions to the industry’s many challenges, including optimizing existing palm oil plantations as requested by President Joko “Jokowi” Widodo in April 2016.
The nine finalists responded to an international call for ideas to solve the biggest challenges facing independent smallholder palm oil farmers in Indonesia: financing, farming inputs and best practices, mapping and land tenureship, market information, as well as product traceability and transparency. The innovations are designed to make sustainable, more profitable palm oil production within reach for Indonesia’s independent smallholders.
Innovators from Stanford University (USA) and a consortium consisting of Bentang Alam (Indonesia), Forest Carbon (Indonesia), SNV (Netherlands), Financial Access (Netherlands), and Akvo (Netherlands) offer solutions to help smallholders obtain affordable, more timely financing. Stanford University proposes a 10 percent price premium for smallholder farmers who comply with sustainability standards, only passing on a small portion of the cost to buyers. Bentang Alam proposes combining cash and farm input loans that can decrease risks for financial institutions and increase value to farmers.
PT Pandawa Agri Indonesia and Indonesian Oil Palm Research Institute offer tools to improve farming inputs and help smallholders increase crop yields and productivity. PT Pandawa Agri Indonesia offers an organic herbicide, produced using local materials, that could reduce the use of pesticides up to 50 percent. Switching to the herbicide may reduce the use of Paraquat, a banned substance that remains prevalent in the oil palm industry. The Indonesian Oil Palm Research Institute will provide access to high quality oil palm seeds and technical assistance to smallholder farmers.
Landmapp (The Netherlands) and the Cadasta Foundation in partnership with Humanitarian OpenStreetMap (USA) offer solutions to help smallholders map farmland and secure property rights. Landmapp works directly with smallholder farmers to map their land, gather data, and submit an official title application. Cadasta Foundation tests new approaches to capture land and resource rights data and uses a Humanitarian OpenStreetMapping tool.
An innovator from Singapore, EcoHub Global, proposes a free mobile application that gives smallholders access to real-time pricing information from mills, maps to agricultural inputs, and information on good agricultural practices. The app also serves as a platform to communicate with buyers, processors, and cooperatives.
Lastly, Sourcemap Inc. (USA) and PT Koltiva (Indonesia) offer solutions to improve traceability and transparency in palm oil production. Sourcemap Inc. provides a field monitoring and traceability application that combines data collected in the field with enterprise purchasing records and third-party risk data to present a complete supply chain process. PT Koltiva Indonesia recommends adapting tracing technology that has been used in the cocoa industry.
The competition was run by Smallholders Advancing with Technology and Innovation (SAWIT), a partnership between the Oil Palm Smallholders Union (SPKS) and the Indonesia Business Council for Sustainable Development (IBCSD), with support from the U.S. Agency for International Development (USAID).
In Jakarta, Indonesia, innovators will receive comprehensive feedback on their solutions from the companies and organizations poised to bring their ideas to the market. SAWIT finalists will also be matched with other resources and networking opportunities based on each innovator’s biggest needs.