chapter 3 jambi comparisons: remaking the land...

In this chapter we will examine the extent to which Jambitree planting follows the patterns discovered in WestKalimantan. The analysis will be less detailed,concentrating particularly on areas where emphases aredifferent. Initial fieldwork was carried out in Jambi inNovember 1997 with a follow-up to seek furtherinformation in February 1998.

Regions, Population Change and theSmallholder Economy

Described not long ago as still an agricultural frontier(Rice 1989), Jambi is characterised by three very distinctregions (see Map 3.1):1) the marshy coast with large areas of peat forest,

especially in the Berbak National Park;2) an intermediate flat-to-gently rolling region of rather

poor soils, now with only isolated forest remnants1;and

CHAPTER 3

JAMBI COMPARISONS: REMAKING THE LAND USE MAPIN A SMALL SUMATRAN PROVINCE

3) the higher foothills and slopes of the BarisanMountains in the west (including the fertile volcanicvalley of Kerinci), together with other hilly zones,especially along the northern and southern borderswith Riau and South Sumatra.

Many of the forested hills and mountains are nowofficially included in conservation areas, such as thehuge Kerinci Seblat National Park (Taman NasionalKerinci Seblat, TNKS) which covers parts of fourprovinces, the Gunung Tigapuluh Protected Forest alongthe Riau border and the smaller Gunung DuabelasBiosphere Reserve, which lies entirely within theprovince. In terms of tree planting, the coconut/wet ricesystem established almost a century ago by Banjareseand later Buginese immigrants dominates the coast,merging westwards into an extensive district wheresmallholder rubber is still the most important land use,but is increasingly being replaced by oil palm. Logging

Map 3.1. Jambi Locations

�

�

�

�

�

�

�

�

�

RSumatera

Trans

Highway

imbobujang

Muarabuat

Lubukpauh

T

Tung

kal

River

ebingtinggi

Merlung

KUALATUNGKAL

TANJUNG JABUNG

BATANG HARI

SAROLANGUN - BANGKO

RIAU

B

SUMATERA BARAT

ENGKULU SUMATERA SELATAN

BIOSPHERERESERVE

N0 10 20 30Km

NATIONAL PARKS

PROVINCIAL BOUNDARY

KABUPATEN BOUNDARY

BANGKO

Batang

hari

River

Tembesi

Riv

er

NATIONAL PARK

BUNGO TEBO

MUARABUNGO

KERINCI SEBLATNATIONAL PARK

GUNUNG DUABELAS

GUNUNG TIGAPULUH

BERBAKNATIONAL

PARK

LAKE KERINCI

JAMBI

CIFOR Occasional Paper No.18: Tree Planting in Indonesia: Trends, Impacts and Directions32

concessions continue to operate in some of the uplandproduction forests, while HTIs are reforesting parts ofthe logged-over sections. As in West Kalimantan, mostof the logged-over lowland and rolling hilly areas arenow subject to strong land use competition, with HTIs,rubber-planting squatters and oil palm estates all vyingfor control. The populous Kerinci valley, whoseinhabitants are ethnically different from the majorityJambi Malays2, specialises in smallholder cinnamon andcoffee. New agroforestry schemes are in operation inthe buffer zone of the TNKS, in an attempt to reduceencroachment on the park.

Population growth has been rapid in Jambi over the lastfour decades, with increased rates being consistentlyabove and presently almost twice the national average.In this aspect the province differs from WestKalimantan3, where population growth is slower.Although densities in both Jambi and its neighbour, Riau,at around 40 per square kilometre, are the lowest inSumatra, they are well above those in West Kalimantan.One reason for the recent population growth is thegovernment-sponsored transmigrant intake.Transmigrant settlement began in the tidal swamps in1967, then during the 1970s and 1980s moved to the

central plains and uplands. Current transmigrants(mainly from Java) regularly form around 4% of thepopulation, although after five years they are no longercounted separately, their villages coming under normaladministration. Special projects (Trans SwakarsaMandiri or TSM schemes), specifically allocate land tosecond generation migrants. The extensivetransmigration settlements thus provide long-standingJavanese enclaves, though some families trace theirancestry further back, for example to the original teaplantation in Kerinci, which began importing Javaneselabourers in 1918. It was estimated in 1985 that almost25% of the population originated outside Jambi (SUPAS1985, quoted in Mubyarto et al. 1992: 32) and theproportion may be greater today. The upgrading of theTrans-Sumatra Highway, which crosses the westernsection of the province through the regency capitals ofBangko and Muara Bungo, has improved Jambi�saccessibility to other parts of Sumatra and to Java. Largenumbers of spontaneous migrants have arrived by thisroute, becoming squatters along logging roads orworking as rubber tappers. As many of these settlersremain unrecorded in provincial statistics, populationgrowth rates in Jambi are probably higher than theofficial figures suggest (van Noordwijk et al. 1995).

Map 3.2. Batang Hari regency vegetation, 1986

Source: Laumonier et.al Central Sumatera

Batang hariRiver

Tem

besi

River

Batang ha

ri

River

JAMBI LOWLAND FOREST

SAME BUT LOGGED OVER

SECONDARY, DERIVED TYPES MAINLY SCRUBBY

MOSAIC, RUBBER PLANTATIONS, SMALLHOLDERS & SECONDARY GROWTH

ORCHARDS, COCONUTS, OFTEN MIXED WITH PADDY FIELDS

MOSAIC OF DRYLAND RICE FOOD CROPS (SHIFTING CULTIFATION) & SECONDARY GROWTH

RUBBER PLANTATION

GRASSLAND OR SHRUB SAVANNAS

TALL PEAT SWAMP FOREST

AS ABOVE, LOGGED OVER

SECONDARY SHRUBBY TYPES

LOW PEAT SWAMP FOREST ON THICK PEAT, INCLUDING POLE FOREST

N

0 10 20 30 Km

Lesley Potter and Justin Lee 33

Perennial tree crops, especially smallholder rubber(introduced in 1904), have long been more importantthan annual food crops in Jambi. One Dutch report noted�Djambi has been the leading residency in the exportsof native rubber, but is the most backward in practicallyall other agricultural enterprises� (Luytjes 1928: 27trans.). A large proportion of the indigenous populationstill owns extensive areas of rubber land, most of it thehighly diverse �jungle rubber�, but with trees which areold, often affected by termites or fungal disease and nolonger very productive. Dependence on the daily harvestof rubber to meet basic purchased food requirements isnevertheless still high. With the exception of the Kerincivalley, land suitable for irrigated rice production in Jambiis quite limited.

Transmigration schemes established during the 1970son Jambi�s poor soils quickly adopted mixed food andtree crop strategies. Schemes such as Rimbo Bujang(in Kab. Bungo Tebo established in 1975) provided 3ha of land for rubber and settlers were advised to planttree crops as soon as possible (Meyer et al. 1978: 101).In World Bank-sponsored Batu Marta, across the borderin South Sumatra, 1 ha of rubber per family was plantedby a government estate (PTP), then allocated to thesettlers after six years, when it was ready to tap.Although initially quite ignorant of working rubber,settlers promptly abandoned their food crops, devotingall their energy to making as much money as possiblefrom the rubber, while at the same time overtapping the

trees. Although it is argued that this was a sensiblestrategy (Levang 1997), more recent PIR Trans schemes,associating private estates with transmigrantsmallholdings of rubber or oil palm, now regulatebehaviour more strictly. Transmigrant households mustalso gradually repay the costs of crop establishment.While there has been much criticism of earlier food cropschemes, the move to estate-based PIR Trans settlementsfitted both the World Bank�s recommendation and theIndonesian Government�s decision to reduce spendingon transmigration. The private sector (and the settlersthemselves) was therefore encouraged to meet the costs(Rice 1989; World Bank 1992).

The Timber Industry, Forest and LandClassification

Recent information released by the provincial ForestryDepartment (Table 3.1) shows a major decline in thearea designated as �forest estate�, when compared withearlier published figures. Since the early eighties, theclassification of forest area by function has divided theIndonesian forest into three major categories: protection,production and conversion forest. In 1990, 55% of theprovince was legally �forest�, compared with 72.5% in1980 (Mubyarto et al. 1990; BPS Jambi 1996). Nowthe forest area has been further reduced to 42% of thetotal, or 2.1 million. ha. The category �conversion forest�has been dropped altogether, and production forestreduced by more than 150 000 ha between 1995 and

Map 3.3. Jambi provincial land use plan

Source: Map drawn 1996 by Cartography Lab. Geography Faculty, Universitas Gadjah Mada, from "Peta Rencana StrukturTata Ruang Propinsi Daerah Tingkat I Jambi, 1993"

AREA FOR AGRICULTURAL & NON-AGRICULTURAL USE

PRODUCTION FOREST

LIMITED PRODUCTION FOREST

PROTECTED FOREST - PEAT SWAMP

PETROLEUM MINING AREA

BUKIT DUABELAS BIOSPHERE RESERVE

BOTANICAL FOREST RESERVE

BERBAK NATIONAL PARK

DURIAN LUNCUK NATURE RESERVE

JAMBI CITY

BATANG HARI

RIVER

TEM

BESI

RIVER

N

0 10 20 30 Km


Table 3.1 Jambi land classification

1997, while protected areas have increased. It is notablethat over 500 000 ha have either been licensed orreserved for estate crops (Dinas Kehutanan Tk I Jambi1997).

It would appear that the Forestry Department is finallyacknowledging reality. �Conversion forest� has longsince been converted to other uses, while logged-overproduction forest is rapidly changing status so that itsreplacement with estate crops may proceed, where thathas not occurred already. A World Bank report on treecrops, discussing the Sumatra series of the maps

produced by the Regional Physical Planning Programfor Transmigration (RePPProT), noted that extensiveareas originally designated as protection or productionforest were in fact under tree crops, and should bereclassified4. In Jambi, 335 100 ha were identified assuitable for new transmigrant tree crops (World Bank1992). The 1996 Provincial Land Use Plan (RencanaTata Ruang Wilayah Propinsi, RTRWP) is now basedon the RePPProT maps5. According to observers, it isstill unrepresentative of what actually happens, but thisis not surprising given the rapidly changing situation,especially with regard to estate crops.

Area of lands (ha)

(Min. For.)

% of total

land area

Land classification Area RTRWP(BAPPEDA)

1996 (ha)

% of total landarea

1995 1997 1995 1997

I. Protected Areas

a. Protected areasProtection forest

Peat areas

Beach and riverbank

134 500

85 625

286 940

2.64

1.68

5.63

181 200 187 125 3.55 3.67

b. Parks and ReservesNational parks

Recreation parks

Research forests

Nature reserves

Mangrove areas

545 000

22 250

3 400

22 800

6 500

10.68

0.43

0.07

0.45

0.13

602 900

(included)

“

“

“

617 890

37 850

3 000

29 827

11.82 12.12

Total 1 107 015 21.71 784 100 875 692 15.37 17.17

II. Cultivated and

human use areas

a. Forest

Prodn forest (perm)

Prodn forest (ltd)

*(Total prodn forest

*Conversion forest

870 500

450 200

1 320 700

17.06

8.83

25.89

1 429 245

(included)

1 429 245

454 466

870 500

405 200

1 275 700

28.02

(incl.)

28.02

17.06

7.94

25.01)

8.91

Total forest estate 2 427 715 47.60 2 667 811 2 151 392 52.31 42.18

HPH Area

HTI Area

Total

979 630

240 275

1 219 905

b. Non-forest

*Licensed estate

crops area

Total Agric. and

Non-Agric land

(includes settlements,industries, etc.)

2 665 035 52.25

504 047

Total Human Use Areas 3 992 985 78.29

Total Area of Province(from latest maps)

5 100 000 100.00

Sources: Pemda Tk I Jambi (1996); BPS Jambi (1996); Dinas Kehutanan Tk 1 Jambi 1997 (unpublished)


There are many similarities between West Kalimantanand Jambi in their historical experiences withsmallholder rubber and the broad outline of the moderntree planting situation, but one difference is the size ofthe forestry component in Jambi. Although there arestill about 12 active logging concessions in the province(as against 24 in 1995 and 30 in 1992),6 most recentcomparable published figures indicate production levelsat about 37% of those in West Kalimantan (BPS Jambi1996; BPS Kalbar 1996). Timber production felldramatically (by more than 50%) in both the centralregency of Batang Hari and the northwestern district ofBungo Tebo between 1994 and 1995 (BAPPEDA Tk IIBungo Tebo 1996; Batang Hari Dalam Angka 1996).In Sarolangun Bangko (Sarko) regency, which has about1/3 of the area under concession, there have also beenrecent declines, though more moderate (DinasKehutanan, Sarko, November 1997). The officialprovincial figures have continued to show overallincreases, at least until 1995, for both raw logs andplywood, but increasingly these supplies of timber arecoming from logs salvaged in land clearing activities(BPS Jambi 1996).

The Timber Industry and IndigenousDispossession

The impact of the timber industry on the rubbersmallholders along the Batang Hari river and the shiftingcultivators and rubber producers of the upland loggingdistricts is well illustrated in two small books by aresearch team from Gadjah Mada University (Mubyartoet al. 1990, 1992). These studies provide usefulbackground to the present volume, as they deal withwhat were considered pressing forestry conflicts at thetime of writing. The first looks at the question of �illegallogging� by local people within the forest estate. Thesecond considers the HPH Bina Desa programme(HBD), an attempt by government to improve relationsbetween the logging companies and villagers residentinside a concession, while encouraging their transitionfrom swidden to permanent agriculture.

The rubber smallholders along the Batang HariIn 1990 Jambi was described as one of the favouredprovinces in Sumatra. Environmental riches still existedbecause development had been based on smallholderrubber rather than large estates (Mubyarto et al. 1990:xv). Batang Hari regency, centre of the ancient Jambisultanate and heartland of the Jambi Melayu people(Andaya 1993), in 1988 had almost 30% of its area undertree crops, predominantly rubber,7 compared with around20% in the province as a whole (Mubyarto et al. 1990:60). Large rubber plantations existed around Jambi city,but most of the rest was smallholder production (Map

3:2). Rubber-producing villages were especiallyconcentrated along the Batang Hari river, where thecomplex agroforestry system included wet rice, coconutsand mixed fruit trees. Further from the river, landsdescribed as secondary forest and scrub (the predominantvegetation) may also have been under rubber.

Wood and wood products eclipsed rubber in total exportsby value from about 1979, as a result of a boom in timberproduction and low rubber prices in the 1980s. Theselow prices induced the rubber smallholders to rest theirtrees and adopt their usual alternative economic strategy;collecting forest products. Unfortunately such productswere located on lands already leased to loggingconcessionaires, with whom there was constant conflict.From seeking forest products (mencari hasil hutan), thepeoples� activities were labelled as stealing forestproducts (mencuri hasil hutan) (Mubyarto et al. 1990:85). Nevertheless, the presence of the concessions brokedown village isolation, while the wood-based industriesprovided employment for some; Batang Hari regency,being close to Jambi city, had its share of these industries,including 6 plywood factories and 26 sawmills.

Concessionaires and smallholders in the uplandsIn the second book, the location shifts to the uplandconcession areas, where again smallholders plantedrubber, but also produced food crops by rotatingswiddens over a large communally owned block. Theirsystem resembled that of their Minangkabau neighboursin West Sumatra, from whom many were descended.The clearing of forest land for cropping was frownedupon by both the government and the concessionaires,and people found themselves labelled enemies of theforest. Under pressure from the logging companies thelands available for food crop production became limited,forest products disappeared, and streams were pollutedand frequently in flood. The loggers in their clumsinessdestroyed rubber cultivation, fruit trees and crops;compensation paid to villagers by PT Mugi TrimanIntercontinental between 1985 and 1991 totalled almost6 million rupiah (Mubyarto et al. 1992: 52). Theresearchers found a typical comment from the people inthree upland districts was that the HPH were �thirsty forland� (haus lahan) (Mubyarto et al. 1992: 40). InSarolangun-Bangko regency, PT Serestra, one of the fewto begin a HTI project, encouraged villagers under HPHBina Desa to participate by providing seeds for pulptrees such as sengon (Paraserianthes falcataria) andsungkai (Peronema canescens), together with improvedrubber. There was little consultation, however, andpeople had only a hazy idea about the purpose of a HTI.Mubyarto concluded that the programme was far too�top down� and unrelated to peoples� pressing needs.In general, the loggers described themselves as not yet


ready to assist local agriculture, although there was someimprovement in facilities, such as provision of roadsand buildings. They were also reluctant to employ localsin forest work. PT Serestra, for example, drew 87% ofits employees from Java and only 8% from Jambi. OneHBD village was selected as the site of a plywoodfactory, but 73% of those employed came from outsidethe regency (Mubyarto et al. 1992: 142). While thepurpose of HBD was supposedly �in situ development�,little of that took place. In Tanjung Jabung regency,concession land was already being converted to otheruses. One of the villages selected for assistance wasnext to a new oil palm estate, while another had its landsresumed for a transmigration project.

The Kubu people and land use changeAboriginal forest dwellers, the Kubu (Anak dalam) andOrang Rimbo still endeavour to maintain a hunting andgathering existence in what is left of Jambi�s dwindlingforests. They try to stay away from all governmentprogrammes, including schools for their children andmedical services, although a few have allowedthemselves to be resettled. The Kubu were grantedspecial settlement rights in the Gunung DuabelasBiosphere reserve and the Gunung Tigapuluh NationalPark, but local NGOs who have attempted to check theirwelfare are pessimistic that they can maintain theirtraditional lifestyle much longer. Once extensive buffersof production forest, which allowed them to increasetheir hunting range beyond the protected areas, havebeen converted to HTI or estate crops. Even the nationalparks and reserves are not free from seekers of timberand forest products, and the animals are disappearing.The Orang Rimbo, who live along the upper reaches ofrivers such as the Batang Hari, have similar problems.8

These aboriginal groups will shortly resemble theircounterparts in Peninsular Malaysia, such as the Senoi,whose small areas of forest are surrounded on all sidesby oil palm (Brookfield et al. 1995: 128; fieldwork,Pahang, April 1997). At a conference last Decemberbetween WARSI and BAPPEDA in Jambi, it wassuggested that the Kubu would be better off resettled onan oil palm plantation, preferably one of those in BatangHari regency (Suara Pembaruan 28/12/97).

Tree Planting Schemes Based uponExisting Smallholder Agriculture

Improving the quality of smallholder rubberThe usual government block planting projects have beentried in Jambi, with similar results to those inKalimantan. The PRPTE schemes,9 while attemptingto rehabilitate 51 000 ha of smallholder rubber between1979 and 1984, managed to cover 29 000ha, of which55% failed (Mubyarto et al. 1992:20). Later projects10

have also touched only a fraction of the planted area.

Figures from the Estate Crops Division covering theperiod 1985 to 1995 reveal only 23 000 ha of successfulestablishment of improved varieties, while the area ofsmallholder rubber is more than 500 000 ha (BPS Jambi1996). However, many new private smallholderplantings (and perhaps a high proportion of the smallplots burned during the 1997 dry season) have resultedfrom the activities of spontaneous migrants, some ofwhom are former transmigrants from Lampung. Aproportion are squatters, cultivating lands opened alongabandoned logging roads; others work as labourers fora while, then purchase rubber land from locals andproceed to replant it with improved stock (van Noordwijket al. 1995: 25-6, 50). In Bungo Tebo regency, newrubber plantings have been increasing by 5000 ha peryear, though it was believed that this rate would soonslow down, as land was becoming scarce (KetuaBAPPEDA Bungo Tebo personal communication, 19/11/97). Provincial rubber yields have increased overthe past two years and are somewhat higher than nationalyields, but at around 600 kilograms per hectare theyremain below optimum.

Photo 7. Jungle rubber gardens in Rantau Pandan, the

location of ICRAF studies

Rather than become involved with government schemes,many rubber smallholders have preferred to acquire theirplanting materials as needed from private nurseries. TheDivision of Estate Crops is in the process of establishingsmall nurseries for bud-grafted material in variousregions, although it is not known whether such materialsare widely available (Kompas 6/9/97). Most farmersuse only small numbers of seedlings because they findit difficult to extend their gardens. Those who have only2 or 3 ha of land cannot take more than a small section(usually the oldest trees) out of production at any onetime. Even those owning larger amounts of land haveproblems in establishing the better varieties under �jungle


rubber� conditions, especially protecting them from wildpigs. This question has been taken up by ICRAF at itsresearch site in Rantau Pandan (Bungo Tebo). Whileemphasising the diverse nature of the complexagroforests created by the traditional rubber growers (deForesta 1995: 168), the ICRAF researchers haverecognised the need for farmers to increase theproductivity of their rubber. The two most importantquestions concern the types of clonal materials bestsuited to the conditions, and the effect of theirintroduction on biodiversity (van Noordwijk et al. 1995:91). These are not easy tasks, nor are quick answerslikely to be found. This ICRAF research comes underthe �Alternatives to Slash and Burn (ASB)� umbrella,and is a Rubber Agroforestry System or RAS projectsimilar to those in Kalimantan. Conscious of the generalindifference of government authorities to the benefitsof traditional rubber smallholdings, the researchers sawsome recognition of the peoples� role in managing forestin the willingness of the Forestry Department to establisha community forest (Hutan Rakyat) on part of thecommunal food cropping scrubland. Planting materialswere provided to 50 farmers, enabling them to plantdurian, cinnamon, sengon and surian (Toona sinensis)(van Noordwijk et al. 1995: 44).

However, despite a 2-year stay by ICRAF researchersand the construction of a trial rubber smallholding,villagers did not see anything changing as a result ofthe project. The decision has been made to convert some

of this same community land (at least 1000 ha, much ofit under Imperata) to an oil palm estate. A privatecompany will run the estate, with the farmers retainingand working a portion of the land (one-third to thecompany, two-thirds to the village) or sharecropping itwith others. Their 40-year old rubber gardens wouldnot be affected. The village head noted that only 30%of the village households actually owned rubber trees(though some of these families had extensive holdings);the rest were employed as tappers. Villagers interviewedwere enthusiastic about the oil palm idea, seeing it as away of increasing incomes, especially as the Imperatalands no longer produced much food (fieldwork,November 1997). However, it is unlikely that any oilpalm company would be content with a mere 1000 haof admittedly unproductive land. At least 6000-10 000ha are usually needed for a minimum sized estate (DinasPerkebunan, Jambi, interview 14/11/97). Althoughreplanting the old rubber should be easier once the oilpalm lands come into production and people have anadditional source of income, whether this will in facthappen is an interesting question.

Controlling cinnamon in KerinciThe cool Kerinci valley (800 m elevation) is one area inJambi where smallholders produce little rubber,concentrating their efforts on growing robusta coffeeand cinnamon trees (Cinnamomum burmani) for theirbark. The population of the valley, which is entirelysurrounded by the Kerinci Seblat National Park, is almost300 000. With such a large number of people in closeproximity to the park, the maintenance of the buffer zoneand the prevention of further encroachment have becomethe main targets of government policy, especially sincethe boundary demarcation in 1992.11 In that year 15000 families were estimated to be living within the parkboundary (Aumeeruddy and Sansonnens 1994).Because the cinnamon trees are cut down in order toharvest the bark, and are at their best when between 10and 25 years old, long rotations are practised by growers,together with coffee, fruits and timber trees. However,in the last few years of these rotations, monocultures ofcinnamon are typical. Wet rice lands are available onthe flat valley floor, so the trees are not competing withthe principal food-growing area. Selective cutting ofcinnamon trees is recommended, but the traditionalsystem is to fell all at once, then plant upland food cropsfor one or two years while cinnamon and coffee are re-established. An urgent need for cash will also encouragefarmers to fell large numbers of trees (fieldwork, Lempurvillage, 16/11/97). Such cinnamon harvests can lay barelarge areas of steep land, exposing the slopes to severeerosion until a crop cover is re-established. Manyexamples of scarred slopes were observed in the field.Official figures give 22 300 ha of �critical land� in theregency, some of which is being reforested with Pinus

Photo 8. A Middleman tests the quality of latex he intendsto buy from a smallholder


merkusii (discussion, Dinas Perkebunan, Kerinci, 17/11/97). Government programmes have focussed onplanting a �harvestable forest� (Hutan kehidupan), arange of 11 other trees which must be mixed withcinnamon in the buffer zone area. These are trees whichmay be harvested, but not cut, such as orange, kemiri(candle nut), durian, avocado, aren (sugar palm) andpinang (areca nut) (discussion at National Park Office,Sungai Penuh, 17/11/97).12

Braksan 1992). However, a number of families wereassigned to oil palm plantations in Batang Hari regency(some hours� travel to the east) as local transmigrants.The villagers who worked on the tea plantation,descendants of Javanese labourers recruited duringDutch times, owned no land so were keen to accept theoffer of 2 ha of oil palm. Local Kerinci people were notso happy and many returned. The experiences of oneof these �resettlers� will be recounted as part of thediscussion on oil palm.

Tree Planting Schemes which DisplaceSmallholder Agriculture

Industrial timber and pulp estates (HTI)With a few exceptions, timber estates have been quiteslow to establish themselves in Jambi, allowing squattersto occupy logged-over land and oil palm companies toestablish their claims to the former concession areas.There were eight HTIs in 1994 compared with 26 inWest Kalimantan (BPS 1997b), and nine appeared in arecent local list (Dinas Kehutanan Tk I Jambi 1998).The most important is Wirakarya Sakti (WKS), part ofthe Sinar Mas group, which operates a pulp plant with acapacity of 430 000 tons per year at Tebing Tinggi,upriver from Jambi�s port of Kuala Tungkal (Sonnenfeld1996; Ir Daniel, WKS, interview 17/2/98). The plant iscurrently operating at 70% of capacity, with all its woodsupplies being drawn from land clearing operations foroil palm, HTI and other purposes, mainly on formerforest concessions. Much of this wood is securedthrough the state forestry company, Inhutani V, whichtakes over worked out concessions to reforest them, andhas the right to sell the timber. WKS, which arrived inthe area in 1989, has a concession of 50 000 ha in thearea of Tanjung Jabung near the factory, much of itplanted to Acacia mangium. A further 70 000 haadjoining block has been applied for, but not yet granted.The company estimates that it will need about 250 000ha of timber-bearing land in order to keep the millsupplied in the future, and has been energeticallypursuing a �partnership� or commercial farm forest(Hutan Rakyat)13 arrangement with local farmers, whoare providing land for planting Acacia mangium. Theseactivities only began in 1996/7, with 56 000 hasurrendered to date by farmers who will grow trees in a50/50 partnership with the company, which bears allthe costs. It is officially stated that farmers must formthemselves into a cooperative and together supply aminimum of 50 ha of land, preferably within a reasonableradius of the pulp mill. However, the most recent mapof the company�s lands and the Hutan Rakyat showslarge numbers of scattered small parcels, someoccupying as little as 2 ha.14 A planned expansion alongthe lower reaches of the Batang Hari, on the other hand,

International organisations such as the Worldwide Fundfor Nature have also been active, studying the traditionalagroforestry. They have discovered that complexagroforestry systems (pelak), with a number of legume,fruit and timber trees, have emerged in areas underpopulation pressure with limited land, in whichcoppicing of cinnamon trees is practised and the longrotations no longer exist. Coffee and rubber may beother major crops (Aumeeruddy and Sansonnens 1994).Although it has been suggested that such local traditionsbe used to construct a sustainable buffer zone, these ideasdo not seem to have been taken up by park authorities.A more radical and often preferred alternative has beento decrease the population within the buffer zone bymeans of resettlement. While the original plan was tomove entire villages, this did not eventuate (Alamsyah

Photo 9. Cinnamon trees stripped of their bark, Kerinci,Jambi


is in three large blocks totalling 72 000 ha. On a smallerscale are factories focussing on sengon (Paraserianthesfalcataria), such as PT Pesut in Batang Hari regency.This enterprise is also offering a �partnership�arrangement with farmers, on a 60/40 basis to thefarmers� benefit, while the company again bears all costs.Although the plywood factories belonging to PT Pesutand PT Sumatera Timber Utama Damai (STUD) willtake sengon timber, farmers interested in growing itregard the marketing situation as rather uncertain.

The intense competition for land between HTI interestsand those of oil palm noted in West Kalimantan isequally strong in Jambi. Recently logged forest land isnow largely taken up, so both the HTIs and those seekingfurther oil palm development are trying varioustechniques to gain access to farmers� land, usually oldrubber gardens and secondary regrowth. While oil palmappears to have largely won the battle, the DeputyDirector of WKS believes that farmers are especiallyinterested in commercial farm forestry in land-richlocalities, where they can afford to wait for the trees togrow. The Forestry Department also claims that growingacacia is simpler for the farmers, especially as, unlikeoil palm, the company meets all the costs (Ir Daniel,WKS; Pak Frans, Dinas Kehutanan, Tanjung Jabung).

In order to study the impact of both the HTI and oilpalm on the nearby villages, both local and transmigrant,three different villages near Merlung were visited inNovember 1997. A small sample of farmers wasinterviewed by students from the University of Jambi(UNJA) as part of this project.

Dusun Mudo is a transmigration settlement near WKS.The people, 100 families from Yogyakarta and East Java,arrived in the district in 1992; current population isaround 400. The farmers, 11 of whom were interviewed,each owned 2 ha of land, one of which was alreadytenured. They described their main occupation as rubberfarmers, and they have 1 ha of clone rubber, but as thatis not yet bearing they must find other ways of earninga living. Most were labourers or merchants beforecoming to Jambi. Since the HTI began planting in thedistrict in 1994, most now work for the company also.They use the tumpangsari system to plant Acaciamangium trees, growing upland rice underneath the treesfor one or two years until canopy closure. They workone week as day labourers on the estate for 5000 rupiahper day, the other week for themselves. Rice yields arepoor (400 kg/ha) as the hilly soils are not very fertile.The transmigrants have a few fruit trees in their houseyards, but no more room to expand. They state thatland is very limited in the district now, the companyhaving claimed it all. Some have tried growing othercrops such as corn in their yards, but complain of

depredations from wild pigs. Most agree they are partof the HTI, but several also say they feel very restrictedand bound by the company. The labouring work (theyweed and clean up the area) they find doesn�t payenough. One good thing that the company did, however,was to improve the connecting road off the main highwayinto their settlement. This enables them sometimes toalso work for other estates in the district, including PTGatra (oil palm). One older farmer (aged 53) was veryopposed to working for the company. He did not wantto be restricted, preferring to plant more rubber. Hesaid �Sistim perkebunan mengikat petani: upah seringtidak tepat pada waktunya. Gaji tersendat-sendat�.(�The estate crops system ties the farmer: you are notpaid at the agreed time. The wages are static.�) Anotherworked as a day labourer for 10 000 rupiah per day, butcomplained again that the wage was not reliable. Healso wanted to plant more rubber, which he said waseasy to sell; he was looking to buy more land from localpeople. He could receive assistance to plant acacia ifhe wanted to, but he preferred rubber.

In Tanjung Tayas village (also partly a transmigrationsettlement, of around 700 people drawn from variousparts of Java), a group of locals were interviewed (11farmers), with more widely varying experiences. Somehad joined the transmigration scheme and were able towork as labourers or grow acacia like the people ofDusun Mudo. In this settlement, transmigrants had rathermore land (3.5 ha), again including 1 ha of rubber. Thosewho had not become local transmigrants had up to 14ha. Some of the latter group criticised the estate,complaining that it had taken all the land. If they grewtrees they had nowhere to produce food. They wereespecially annoyed about the empty lands of the estate,not yet planted. They wanted some of those landsreleased so the village people could plant trees on them.Others were worried about planting acacia, not sure howmuch they would be able to sell it for, eight years hence.One or two complained that there was in fact littleassistance given to plant this new crop. They werehappier with rubber, which was easy to manage andmarket. A number were in fact growing acacia as partof the Hutan Rakyat (50/50 share crop) scheme. Officialstatistics confirm that Tanjung Tayas village has agreedto release 654 ha for the scheme, of which 235 ha havebeen planted. The theory is that after an 8-year contract,farmers would make 4.5-5 million rupiah per hectare.It seemed, however, that many people were uncertainabout whether they should join. Very few young localmen were able to find employment with the company,which had a policy of recruiting its plantation labourersdirectly from Java. Some were still collecting woodand other products (probably illegally) from the forest.15

Otherwise they were engaged in the usual range ofactivities, selling, fishing, growing vegetables and of


course rubber under the most recent scheme of assistanceby government to plant new rubber (P2WK). The landsin Tanjung Tayas are rolling to steep and most infertile,so rice yields, as in Dusun Mudo, are very low.

With the huge demand for raw material from its pulpplant, it is obviously in the interests of WKS to keeplocal people �on side�. However, the responses indicatethat it has so far not been very successful in doing this,mainly because of the amount of land it has alreadyresumed. Local people find it harder to get employmentwith the company than do Javanese, a tendency that hasbeen noted before in the attitudes of the loggingcompanies. It is interesting that the transmigrantsthemselves, although as a group more content to have asteady job and own a piece of land, are not entirelyunanimous about the benefits of plantation work. Themajor difficulty facing the company�s public relationsefforts is the unknown likely value of acacia in eightyears� time. People are familiar with rubber, and anxiousto have high-yielding trees, but acacia is new and theeight-year waiting time is perceived as too long.

Another large cartel, the Barito Pacific group, throughtheir subsidiary, PT Industries Forest Asiatique (IFA),has a 300 000 ha concession in the Tigapuluh Mountains(near the Riau border) in which it is also planned toestablish an Acacia mangium plantation. A British ODAteam is engaged in a variety of field trials with villagesinside the concession. They have control over 136 000ha of the HTI land, and are trying to demonstrate thatnatural forest regeneration will work, and that it can bemixed with the exotic. A Brazilian technique being triedis harvesting in strips, in which there are alternate stripsof Acacia mangium (or other exotics � some Braziliantrees are also being trialled) and natural forest, so thatbiodiversity is maintained and pest attack reduced, buta reasonable profit is also made. As in the WestKalimantan case of Finnantara Intiga, it will beinteresting to see whether these new ideas are acceptableto both private and government sources. The HTIcompany is also interested in the sociological work beingdone by the ODA project, to analyse the people�ssystems of forest management and collection of forestproducts, so that �illegal logging� may be betterunderstood and some compromise reached on use ofthe resources by both groups (Luis Betancur personalcommunication, 20/11/97).

Oil palm estatesFrom an area of only 6000 ha and one estate in 1986(Barlow 1991) and 44 000 ha in 1990, oil palm hasexpanded quickly to reach 185 934 ha in 1996 (DinasPerkebunan Jambi 1997) and approaching 200 000 hatoday (discussion, Dinas Perkebunan, 14/11/97).16 What

is more remarkable is the area over which permits havebeen granted which is waiting to be developed,amounting to thousands of hectares, about 270 000 inBungo Tebo alone. Most of this new area was licensedin the last three years (Kantor Bupati, Kab. Bungo Tebo1997). A large part of it was previously undersmallholder rubber, most of the rest under logged-overproduction forest. If and when all this oil palm comesinto production, it will change completely the face ofJambi so that the province will resemble parts of NorthSumatra, or Pahang in Malaysia. As in Malaysia 20years ago, such transformations bring enormous socialand environmental upheaval.

As explained in Chapter 2, the industry is characterisedby particular kinds of institutions which are graduallyevolving. The older PTP (government-run) plantationsare not of great importance in Jambi, although one ortwo continue to exist (PTP VI). The influence of NorthSumatra is still felt, especially as a source for plantingmaterial. The best seedlings are supplied by two of theolder plantations (PT Nusantara), Marihat and Pabatunear Pematang Siantar.17 More significant are the privateestates, most of which follow the PIR Trans model; anumber have come into production in the past three orfour years. The large estates representing the powerfulIndonesian conglomerates, such as PT Sari Aditya Loka(Astra group) and PT Krisna Duta Agroindo (Sinar Mas)are partly of this type, but hold additional privateplantation land outside the transmigrant scheme. Animportant third group, also private, are the most recent.These are the kemitraan or �partner� estates. Althoughit has been mentioned in Chapter 2 that the arrangementsfor such partnerships tend to be as yet unclear, in Jambi�sBatang Hari regency some experimentation is going onwith special examples of such estates, tied closely tovillage cooperatives.

Photo 10. Newly planted oil palm estate on converted forestland, Bungo Tebo, Jambi.


Most of the Jambi estates are located on the plains androlling lands, with rather infertile mineral soils. TheIndonesian Oil Palm Research Institute claims that theestates in Sumatra are making use of non-productivesecondary forests growing on soils of low to very lowfertility status. On these lands they say oil palm estatesdecrease erosion hazards, improve soil fertility andreduce the damaging effects of shifting cultivation byturning farmers towards permanent production(Adiwiganda et al. 1996). There is complete non-recognition of smallholder rubber in this kind ofstatement. Whitten et al. (1987), in their Ecology ofSumatra, while also unappreciative of smallholderrubber, compare oil palm plantations unfavourably withthose of rubber in terms of animal and bird populations.Squirrels, rats and their predators, snakes, are the onlyspecies which can survive in the oil palm environment.Planters expect to use large amounts of fertiliser, andindeed the productivity of the oil palm largely dependson the fertiliser application. A new venture has been toopen oil palm estates on the peat swamps, both coastaland further inland, where even more fertiliser is required.

In this section we will look briefly at four case studies:a current PIR Trans estate, with transmigrants; a similarestate a few years ago, when the respondent was resettledfrom Kerinci, but returned; a recently established estatein the coastal deep peat; and a cooperative kemitraanestate, using the new model developed in the regencyof Batang Hari.

A PIR Trans estate18

Twenty farmers were interviewed in Desa Jaya Kusuma,Kec. Tungkal Ulu; they were from the Merlung district,most being transmigrants. The estate, PT IndosawitSubur, was planted in 1992; when it became productivein 1995, it arranged to build a factory, a necessity assoon as production reaches 6000 tons. It also receivespalm fruit from other estates which do not yet havefactories. Each farmer received one kapling, i.e., 2 ha,now producing up to 3 tons per year, in addition toanother hectare, which includes a tenured house lot. Allreceived credit to establish their cultivation, but had topay that back in monthly instalments and add 12%interest; 30% of their production had to be used eachmonth to pay off their loan, which was 10 million rupiahper kapling. As well as looking after their allotments,they worked as labourers on the estate, and severalworked on the HTI also, as their settlement was close toWKS. Large amounts of fertiliser were one of thesignificant monthly expenses (30 000-56 000 rupiah),and complaints were predominantly about the size ofthe instalments they had to pay. One or two commentedthat the yield from their palms was not constant, whichmade it difficult to meet these fixed costs. Others werepleased by the opportunity, saw a larger income for their

families and secure employment. One complained thathe had never followed a contract before, that the moneyside was all new and confusing. A teacher and villagefunctionary remarked that the estate was only interestedin its profits, not in the farmers� living costs. Themanagement made no attempt to assist village or regencyinstitutions. In terms of the planting of their other 0.5ha of land, the transmigration department wasrecommending sengon. This at first glance seemed odd,given that the nearby HTI was only growing acacia.However, there was a plywood factory not far away (PTSTUD), which would take sengon timber. Again thequestions were direct: would these trees come to harvestand, if so, what would be their selling price? Cinnamonand coffee had already been tried, but failed. The richestsettler had two kapling and many other business interests:buying and selling livestock, driving an ojek, plantingbananas and chilli. He sold wood to the company forconstruction purposes. Another wealthy local merchantowned two trucks and had a house in Jambi city. Hewanted to buy up the harvest from 10 ha and owned twohimself. He felt that the instalments were too high andbemoaned the dirt road that brought problems to histruck-hiring service. He had planted 1000 sengon trees,but they were not yet ready. Another, who operated anelectronics service, commented that harvests were stillrather unreliable, while the cost of living was rising fast.

Life is becoming more difficult for farmers in PIR Transschemes, both transmigrant and local, with the drop inproduction caused by the drought and smoke of late 1997followed by the precipitate decline of the rupiah, andall prices have risen accordingly. Observers in WestKalimantan suggested a 100-300% increase in fertiliserand chemical costs occurred in January 1998 (Kompas24/1/98).

ResettlementThe resettled farmer and his family moved from Kerinciin 1992 to a PIR-Trans oil palm plantation in BatangHari regency. There were 12 families from his village(Lubuk Pauh), among 300 families from the district.When they arrived, they were told that the palms wouldbe ready to harvest in 1.5 years, but they had to waitmore than four years, during which they could only workas labourers. Although he had a salary, his wages weresmall. After four years, still with no harvest, severalfamilies could no longer afford to stay. He calculatedthat only 30% stayed, usually those of Javanese ancestry.They all looked for labouring work on other estates too,and anything else they could find. Another criticismwas that with oil palm, responsibilities were not clearlyspecified. His wife also worked each day, gathering thefruit into piles, cutting branches, and earlier was involvedwith him in the land clearing and burning. That washeavy work and included carrying wood, something


Much more fertiliser has to be used under the deep peatconditions, and the productivity is lower. Farmers arepredicted to receive around 200 000 rupiah per hectareper year, which is one-third lower than on mineral soil.In the 1997 season yields dropped further because ofthe drought and fires. The estate was one of the centresof burning during the height of the fire problem in Jambiin September 1997 (see Maps 3.4 and 3.5). Fire enteredthe deep peat as a result of land clearing to open a newsection and then burned fiercely for weeks. The presenceof multiple layers of wood below the surface sustainedthe burning. The manager defended the choice oflocation, suggesting that there will soon be no mineralsoil areas left in Jambi, so extension onto the peat willbe the only possibility. Conditions for workers on thisestate are more difficult than in others visited. Whenasked how they felt when first seeing the area, onereplied simply: �afraid�. This estate, in Batang Hariregency, is part of a group coming under the �cooperativepartnership� banner, discussed in the next section.

women in Kerinci never had to do. �Disana banyaktenaga, hasil sedikit.� (�There you had to labour hardfor a small return.�) He tried everything, includingfishing, but could not make more than 30 000 rupiahper month. Back home in Kerinci, where they had theirown fertile piece of land, their returns were much better.Eventually the family received compensation and wereable to go back to their former home in the buffer zoneof Kerinci Seblat National Park.

A peat swamp estatePT Bahari Gembira Ria is trialling oil palm productionin an area where the peat is over four metres deep.Although there is another estate attempting to workshallower peat with some success, the conditions in thedeep peat area appear to be testing the limits as far asprofitable production is concerned. The estate began in1989 but has taken longer than usual to bring some ofthe land into production, as long, deep canals had to beconstructed. Studies of the initial costs of setting up anestate on peat soil have suggested that it is 54% moreexpensive than on mineral soil (Daswir et al. 1989).

The mainly local transmigrants (some from SouthSumatra) have been working on the estate for five years,and received their allocation of land early in 1997.Fortunately, the housing area for those who live on theestate is on the mineral soil, so the problems of watersupply for washing and bathing are not so pressing.

A model �partnership� (kemitraan) estateThis scheme, specifically designed to overcome povertyby using local farmers in a cooperative framework,termed PIR Koperasi Pola Kemitraan, has been workedout by the Bupati of Batang Hari, Saman Chatib. Aspecially designed village cooperative (Koperasi UnitDesa, KUD) and farmer groups (kelompok tani) areinvolved in the organisation. Farmers retain two-thirdsof their land, planting 2 ha to oil palm, and contributeone-third to the estate in return for general managementof the production and provision of credit, which comesfrom the government�s KKPA scheme. Those who have

Photo 11. Peatlands cleared by fire and planted with oilpalm, Batang Hari, Jambi.

Photo 12. Fertiliser ready for use at Batang Hari. Oil palmestates on peatlands need more fertiliser than thoseestablished on other soils


1996. Another query concerns the role of the KUD.This institution does not have a good record in managingvillage inputs, so special care would need to be taken toensure its proper functioning in this system.

A visit to the showpiece estate, PT Gatra KembangPaseban, provided some answers. The manager statedthat he saw the scheme as a way of transferringknowledge and technology to the farmer. PT Gatrabegan land clearing in 1992, with the oil palm beingplanted in 1994. The first production became available30 months after planting so was still quite low, butenough to plan for a factory in 1998. The price of oilpalm is more stable than rubber and, in this case, thefarmers retained their other income sources (providedthey had land to begin with). The land is now all takenup and as the estate is near a protected forest, it cannotbe expanded any further. The manager had an interestingcomment on the oil palm cobras, which, although theycontrol rats, might have been considered a pest. Heobserved that they provide a useful source of income,being sold live to travelling Chinese merchants, whouse the snake�s body for traditional medicine and sellthe skins. Real pests he considered to be the ulat api,the fire caterpillar which attacked the leaves, and thewild pigs which came from the old rubber forest.

Discussions with farmers, members of an all-malekelompok tani who were working together as aharvesting team, indicated that many had come from a

Map 3.4. Partnership Estates in Batang Hari Regency

plenty of land give up the same proportion and thebalance is then redistributed to the landless. Aftersurrendering their land and spending four years workingon the estate learning how to manage the crop (duringwhich the land remains in the name of the group and theKUD), farmers assume responsibility for their 2 ha andare free to sell their fruit wherever they wish. At thistime there are seven estates and ten KUDs involved,and 30 000 workers from many villages designated aspoor19 (Pemda Tk II Batang Hari 1997; fieldwork, Jambi,November 1997)(see Map 3.4). The Bupati hasexamined smallholder schemes in Malaysia andThailand and sees the cooperative partnership as aversion of the Malaysian FELDA. He is very confidentabout the superiority of oil palm over rubber inimproving the incomes of the farmers, which he believesshould reach 1 440 000 rupiah per year. In a subsequent(rather exaggerated) newspaper interview he producedfigures to demonstrate that although oil palm occupiesabout 50% of the estate crop area in Batang Hari, itprovides 95% of estate crop production (SuaraPembaruan 16/12/97). The rubber, he suggested, wastoo old to really produce any more. While this schemeappears to be the most �farmer friendly�, one wondersabout the element of compulsion here.20 Is this a schemeto draft the poor into the plantation labour force? Hasthe scheme really been adopted by all those estates? TwoHTIs, WKS and PT Pesut are also counted as belongingbecause of their Hutan Rakyat share-croppingprogrammes, which began in Batang Hari in December

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nearby village in which a rubber improvement schemehad failed. They turned to the oil palm as a solution andwere in general happy with it, although production wasdown because of the drought; they used to send threetruckloads a day to the factory at Indosawit, but thiswas now two. When asked about the gender division oflabour, they replied that the light and heavy tasks wereseparated, with women doing the light work such asweeding. Further probing revealed that their wivesworked only occasionally with the oil palm, generallypreferring rubber. Some farmers were still trying toimprove their rubber � one who had joined a Tree CropSmallholder Support project was now tapping theimproved trees after receiving his seedlings through thescheme six years ago. Others were using their extraland to grow sengon. The advantage of sengon overacacia was that it could be cut after five years and sentto a plywood factory but, like others, they were not yetconfident of the buying system. They said that oil palmwas better, as one was paid immediately. The price wasstandard and people could understand it, much more thanthe rubber price. When the question of compulsion wasraised, the reply was that nobody was forced to join. Ahousehold could declare its land an �enclave�, but only5-10% had actually done this. It was obvious that thepressure to conform would be quite severe. One pieceof enclaved land, from where a family operated a warung(food stall) in the middle of the estate, was described asa real nuisance because of the wild pigs harboured bythe rubber forest. Land values in the district had risenfrom 1000 rupiah per hectare before the oil palm arrived,

to the present 300 000 rupiah per hectare, so farmerswith large holdings were very tempted to sell. In a finalcomment, the farmers admitted that, although they puttheir oil palm land in their children�s names, they didnot want them to be estate workers; they would preferthem to be doctors.

Batang Hari regency is more advanced than other partsof Jambi in the transformation of smallholder rubber tooil palm, though large areas still remain under rubber.The regency also has producing oil wells and, like partsof the coast, is becoming more industrial. Its centrallocation near Jambi city means that other occupationsare becoming available for the population, and yet manypeople, especially those in flood-prone riverine villages,still live in poverty. Under these conditions the oil palmalternative may appear a reasonable option. However,the farm household�s total income is predicated on somemembers being able to earn extra money outside theplantation. In particular, many wives will still tap rubber,leaving the oil palm to their husbands. If they are onlytapping old trees, they need a large area of land to receivemuch return. Such land is now subject to pressure fromother interests and its increasing value will tempt thefamily to sell, resulting in a greater reliance on oil palmalone. Considerable areas of land have also passed intothe hands of absentee landlords resident in Jambi citywho hire others to work it. There is no doubt that peoplestill retain a great interest in rubber and would like tofind ways of making their trees more productive. It wasrevealed in September 1997 that a Malaysian company

Map 3.5. Fires in Jambi on October 19th, 1997

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was negotiating to set up a factory in Jambi processingrubberwood from old trees; this could provide a financialincentive to allow farmers to replant with improved stock(Kompas 6/9/97). The kemitraan koperasi estates arean interesting attempt at social engineering but theyshould not be seen as a panacea to solve all localproblems, including the future of minorities like theKubu. Only time will tell whether the model issustainable and replicable elsewhere.

There is no doubt that the burgeoning oil palm industrywill also be tested by happenings over the next two orthree years. Not only must Indonesia battle with thefinancial crisis, which means severe cost rises for bothlarge and small producers, but production will take sometime to recover from the 1997 conditions. Another ElNiño drought would certainly put pressure on those atthe margin. The industry is still so new in much of theproducing area that some understanding of its limits isbarely beginning. To what extent it will be worthwhileto venture into the peat swamps, or to reclaimunproductive Imperata land for oil palm must bedemonstrated by trial and error.

Summary

In this chapter we have looked at tree planting schemesin Jambi, a province with a strong tree planting tradition.It provides an ideal laboratory in which to examine thecurrent land use transformation and the activities of thevarious stakeholders involved, especially the interplaybetween central and local interests and policies. Oneobjective has been to assess the impact on farmers, bothlocal and transmigrant, of the tumultuous upheavals thatare taking place. As in the previous chapter, one of thestrong themes has been that of dispossession of the localinhabitants, as their lands have been classified by theForestry Department, then occupied by logging interests,followed by plantation monocultures of pulp and oilpalm. In the case of Kerinci the demarcation of theNational Park boundaries has affected many lives inbungled attempts at resettlement. Another commontheme has been the rejection of local agriculturalsystems, especially the despised �jungle rubber� in favourof oil palm, and of local labour in favour of Javanese.Outside organisations such as ICRAF and WWF havesought to work with and modify traditional systems,while retaining their beneficial aspects, but have beenseen as marginal by provincial and regency authorities,anxious to speed the pace of change. One fears thatODA might well join them, although these experimentscould provide critical alternative models in the moreopen climate of the Indonesia of the future. Meanwhilethe locals themselves have adapted to the changes,seizing the available opportunities and attempting tomarry the old with the new. This has so far been possible

as many are still �land-rich�, but the high prices availablefor such lands now tempt owners to sell to outsideinterests. The experiments in Hutan Rakyat by the pulpHTI and in �cooperative partnership� by oil palm firmsin Batang Hari are predicated on people continuing toown extra land. In Jambi there remains a strong desireto tap rubber, where possible of the high-yielding variety;many continue to prefer rubber to oil palm, despite thelure of estate wages. It is sobering to recall that as lateas 1990, the province was considered to still holdenvironmental riches, largely because estates wereundeveloped there. Now one may see huge swathes ofempty and burnt out land, awaiting the oil palm. Theextension of estates onto the deep peat soil is ecologicallydisturbing and economically risky, but an indication ofthe push for land which now consumes the province.The Javanese transmigrants, both assisted andspontaneous, so far have been able to be accommodatedby the local population. They are also looking beyondthe estate and seeking to buy land. The limits to thisprocess and to continuing accommodation may soon bereached as locals resent their disadvantage. For groupssuch as the Kubu, the end to traditional lifestyles isapproaching fast.

While there are many similarities between tree plantingactivities in Jambi and the Kapuas basin of WestKalimantan, each has particular features which make ita useful case study in its own right. We now turn to anecologically very different area, Southeast Sulawesi.This little known province is more distant from thecentres of power in the geographical west of Indonesia,but has its own unique tree planting experiences.

Endnotes

1 A detailed vegetation map published in 1986 describedmuch of the area as �logged-over forest� interspersedwith �shrubby secondary forest� � in fact smallholderrubber (Laumonier et al. 1986). The vegetation pat-terns of Batang Hari regency based on the 1986 mapare presented in Map 3.2.2 The Orang Kerinci are descendants from immigrantMinangkabau from West Sumatra. Minangkabau move-ment into upland Jambi has taken place for centuriesand still continues.3 In the fertile Kerinci basin, densities are 69/sq km.4 Maps of agreed forest classification (Tata Guna HutanKesepakatan) had been drawn up by authorities in eachprovince in the early 1980s. They were superseded bythe more accurate series of the Regional Physical Plan-ning Program for Transmigration (RePPProT) at thescale of 1:250 000, the principal aim of which was toidentify large blocks of preferably tree crop land suit-able for transmigrants.


5 Map 3.3 presents the revised land use classification(RTRWP) for Batang Hari regency.6 BPS 1997c.7 There was apparently one oil palm estate.8 Discussions with the NGO WARSI - Warung Informasidan Konservasi - Bangko 15/11/97).9 Peremajaan Rehabilitasi dan Perluasan TanamanEkspor10 Such as SRDP (Smallholder Rubber DevelopmentProject and TCSSP (Tree Crop Smallholder SupportProject).11 The park was established in 1982, but some of itsboundaries were at first uncertain. Demarcation wascompleted 10 years later. Forty per cent of the park liesin Jambi.12 The areca nut apparently produces a good vegetabledye, which is in demand for export.13 While any area of village land given over to tree plant-ing may be termed �Hutan Rakyat�, the lands commis-sioned by the pulp mill are a more specialised form ofvillage tree planting, therefore have been described as�commercial farm forestry�.14 This information was drawn largely from interviewson 17/2/98 and 18/2/98 with Ir Daniel, WKS; Ir Tjetjep,Dinas Kehutanan Tk II, Muara Bulian; and Pak Frans,Dinas Kehutanan Tk II Tanjung Jabung.

15 Comments were made about a sawmill operated bythe company: if you wanted your wood to be processedthere, you had to have connections, and money had tochange hands.16 The Bupati of Batang Hari recently estimated that thereare already almost 160 000 ha under oil palm in thatregency (Suara Pembaruan 16/12/97). However, onlyhalf of that area would be productive, or even planted.In an interview with the Bupati in mid-November I wastold 80 000 ha were under production.17 Fieldwork in North Sumatra uncovered a racket invillage-produced seedlings, purporting to originate fromMarihat, but selling for one-quarter the price and lessproductive. These are sold along roadsides in Riau andJambi. It is not known to what extent such materialsmay have an impact on production levels.18 Again the assistance is acknowledged of students fromUniversitas Jambi in compiling these data during No-vember 1997.19 �Poor� villages are identified as such using variouscriteria and are eligible for special loans (INPRES DesaTertinggal, IDT).20 In another newspaper interview following floods inthe Batang Hari regency, Pak Saman suggested that hewas organising to move the population from the villagesalong the river and place them on oil palm estates (SuaraPembaruan 5/12/1997).

CHAPTER 4TREE PLANTING IN SOUTHEAST SULAWESI:

SIMILAR TRENDS ON A SMALLER SCALE

Tree planting in Indonesia�s eastern provinces variesgreatly from activities in the geographical west.Different species dominate in line with the generallydrier conditions. Company-owned tree estates are raredue to the climate, often rugged topography, poorinfrastructure, distance from markets and the small,dispersed nature of the local population. Smallholdersare responsible for most tree planting but their stands oftrees cover a limited area, also due to the prevailingconditions. Smallholders are often more attracted tolivestock rearing, making use of savannah lands and theeasier transportation of cattle to market.

Despite the differences in local conditions, nationalpolicies promoting tree planting have led to the samegovernment-initiated programmes familiar in Sumatraand Kalimantan being attempted in Sulawesi. Whilethese programmes have been forced to adapt to localcircumstances, their relationships with provincialauthorities and their resultant impacts are similar to thoseoccurring elsewhere.

This example from Southeast Sulawesi illustrates thenature and impact of industrial timber plantations (HTIs)in the east. HTIs in these provinces remain more stronglycommitted to timber production than pulp. Theirorganisers also emphasise the significant contributionsthey can make both to environmental conservation,especially the protection of existing water and forestresources, and to villager welfare, by providingtemporary crop lands and employment opportunities.

In reality there is considerable dissatisfaction with theperformance of HTIs to date and scepticism about theirfuture value, even though Forestry officials are claimingthey can save the unique and economically valuable teakforests of Muna island from overexploitation and illegalfelling. Again there is tension between Forestry officials,attempting to uphold the policies of their centralMinistry, and officials of the provincial government whowork under a different set of priorities. The provincialgovernment and smallholders do not view HTIs as beingin their interests. They both prefer the exploitation offorest resources and their replacement with estate crops.

Southeast Sulawesi: Population andEconomy

Southeast Sulawesi is a small, undeveloped provincewhich has struggled to attract outside attention.

Historically the two islands off the south coast of themainland peninsula, Muna and Buton, were the centreof population and activity (see Map 4.1). The sultanateof Wolio (or Buton) was located at Bau Bau on Butonisland, an important stopping-off point for shipstravelling to and from the spice islands of Maluku. Atthat time the mainland peninsula was sparsely populated,occupied by the Tolaki people on the east coast and theMekongga in the west around Kolaka. Isolated tribesresided in the mountainous north.

After Southeast Sulawesi was declared an independentprovince in 1964 the provincial capital was built atKendari, marking a shift of economic activity andpolitical power to the mainland. While Muna and Butonstill have the highest densities in the province, Kendariis now the most populous regency and Kendari andKolaka are experiencing rapid population growth ofaround 4 and 5% per annum (BPS Sultra 1996: 82). Asis the case with West Kalimantan and Jambi, much ofthis growth has been due to transmigration from Javaand Bali. In the last 10 years alone 59 000 formaltransmigrants have been relocated to Southeast Sulawesi(BPS Sultra 1996: 73). There are also considerablenumbers of Bugis and Bajau people living around thecoasts. The province as a whole now has a populationof 1.46 million living at a density of 38 people per squarekilometre, which is similar to that of Jambi (BPS Sultra1996).

Southeast Sulawesi�s economy remains small. There isa large government sector, very little manufacturing andonly modest trade (Kristanto et al. 1989: 569). Centralgovernment grants make up a large percentage ofregional expenditure. Nickel and fish constitute 99%of international exports (BPS Sultra 1996: 286). Mostof the population, however, earns its livelihood fromsubsistence-oriented smallholder agriculture. Theyengage in dryland swidden farming of rice, corn andcassava, supported by the exploitation of forest productsor fishing and the management of estate trees andlivestock (cattle and poultry). Yields of both food cropsand tree crops are low because of infertile soils, limiteduse of inputs and minimal maintenance. Farmers keeptheir food crops for household consumption and sell treecrops and forest products for cash. Crops sold are tradedwith other islands. Seventy-eight per cent of inter-islandexports from Southeast Sulawesi are estate crops, mostlygrown by smallholders. They include cashew, copra,cotton, kapok and cocoa (BPS Sultra 1996: 286).


Another 10% are forest products, primarily sawn timberand rattan (BPS Sultra 1996: 303).

Low and unpredictable rainfall, small population andshortage of extensive tracts of flat land have deterredagricultural estate development. Until recently, the onlylarge-scale projects included areas of irrigated wet ricefunded by the transmigration programme andinternational donors, and a nucleus estate andsmallholder unit growing cotton, developed by PT KapasIndah Indonesia (Kristanto et al. 1989: 574).

Forest Conversion and IntensifiedAgriculture: Estate Crops VersusIndustrial Forests

Considering the province�s physical resources and thedependence of most people on farming, Southeast

Sulawesi�s government sees agriculture as the leadingsector for the achievement of economic growth in thesecond long-term development stage (PJPII,Pembangunan Jangka Panjang II) (Pemda Tk I Sultra1994: 31). Its regional development plan gives toppriority to intensification of agriculture, especially treecrops, followed by agroindustry and then mining (LaodeAbd. Rauf personal communication). Underlying thisdevelopment will be improvements in transportinfrastructure.

To achieve its goals the government is inviting privateand state-owned companies to establish estates andplantations (Pemda Tk I Sultra 1994: 43). These areintended to create permanent production systems whichgenerate revenue for the province and provide villagerswith employment, reducing dependence on what isperceived to be environmentally unsustainable shifting

Map 4.1 Southest Sulawesi Locations

�

�

�

� �

�

SOUTHSULAWESI CENTRAL

SULAWESI

SOUTHEAST SULAWESI

RIVERS.LASOLO

KENDARIKOLAKA

TINANGGEA

KAMBARA

RAHA

P. MUNAP. KABAENA

P. BUTON

BAUBAU

Location ofTeak Forest

PROVINCIAL BOUNDARYKABUPATEN BOUNDARY

N0 25 50 75 Km


cultivation. The government is also doubling efforts toencourage smallholders to intensify their own estate cropplantings.

This strategy will have important impacts on SoutheastSulawesi�s forest lands. The province�s small populationand small-scale agriculture have left much of the landunder forest cover, primarily lowland forests growingon limestone and ultrabasic soils or in swamps (Whittenet al. 1988: 32). Forest land use classifications are shownin Table 4.1.1 Agricultural intensification and plantationdevelopment will require the conversion of lower-valueforest areas while those of high conservation importancewill hopefully be protected.

Conversion is already under way. While much of theforest resource does not justify exploitation, valuablestands of ebony and teak are being logged. Threelogging companies have concessions over the forests inthe far north of the peninsula, near the borders with South

and Central Sulawesi. The teak forests of Muna islandand south Kendari are logged by a corporation run bythe regional government (Perhutanda) which employsvillagers as cutters. Villagers in south Kendari also setup their own businesses, receiving permission from theregional government to cut and sell logs from sitesintended for conversion. Most of this wood is processedin local sawmills, in either Kendari or Raha (the capitalof Muna regency). There are no plywood factories inthe province.

Estate and plantation activities established on convertedlands differ according to prevailing ecologicalconditions. On the wetter west side of the peninsula

Photo 13. The natural forest has been cleared for teak and tumpangsari on this HTIswakelola site in Northern Muna

around Kolaka, both a private and a state company (PTPXXIII) have set up cocoa estates, the latter using thePIR Trans model. Smallholders (often migrants fromSouth Sulawesi) are also converting forest lands in themountainous north of Kolaka regency to small-scale

Forest land use

classification

Area (ha) accordingto BPS 1997a

% of totalland area

Area (ha)according to BPS

Sultra 1996

% of totalland area

Protection forest 421 000 11.1 1 061 270 27.8

Park and recreation forest 273 000 7.2 272 599 7.1

Limited production forest 827 000 21.7 419 244 11.0

Non-convertible forest 669 000 17.5 281 531 7.4

Convertible production forest 699 000 18.3 212 121 5.6

Total 2 889 000 75.7 2 246 765 58.9

Table 4.1. Forest land use classifications, Southeast Sulawesi

Source: BPS 1997a: 216 (data from Departemen Kehutanan, Jakarta); BPS Sultra 1996: 242 (data from ProvincialForestry Office, Kendari).


cocoa plantations. Often this conversion is withoutpermission. In the far north of Kendari regency twoprivate oil palm companies have been grantedconcessions covering 40 000 ha and have commencedland clearing. They will develop their estates under thePIR Trans KKPA scheme (ICBS 1997: 126). On thepeninsula�s eastern side, in Tinanggea, south Kendari,

there are state-run cashew plantations, and extensiveprivate and state-run sugarcane plantations are planned.

The potential impacts of these developments aredemonstrated by a sugarcane plantation in south Kendarirun by the private company PT Sumber Madu Bukariusing a PIR model. This estate is to be established on25 000 ha of �state� land (tanah negara) presentlyvegetated by secondary forest (68%), scrub (26%) andImperata cylindrica grassland (6%) (PT Sumber MaduBukari 1996). In recognition of the fact that nearbyvillagers previously made use of these �state� lands, thecompany has offered to pay them compensation for someof the land resumed and to set aside 5000 ha as a plasmaestate. The plantation will have a permanent workforceof 1293 people and also employ a further 12 000 astemporary and full-time labourers. Local people, whileappreciating the employment opportunities on offer,have held lively protests arguing that the compensationdelivered to villagers is significantly less than the amountpromised. This action has slowed the plantation�sprogress.

The expansion of estates on Southeast Sulawesi�smainland peninsula appears to accompany declininggovernment support for industrial timber plantations(HTIs) in this area. HTI development is still recent andlimited in scale but actually commenced before manyof the estate programmes. PT Barito Pacific has a 36300 ha concession that it commenced planting two yearsago, growing mostly teak (Tectona grandis) and pine(Pinus merkusii). Another company, PT GuharaLestarindo Cellulose is planting Acacia mangium on aconcession of 17 000 ha in Kendari regency. The mostextensive area of HTI is being planted by the local ForestDepartment, under what it has termed HTI Swakelola(self-management). Commencing in 1989, the HTISwakelola has two units, one in South Kendari of 30000 ha, and the other in the northern part of Muna island,covering 35 400 ha (Dinas Kehutanan Tk I Sultra 1996:1). Funded by the Reforestation Fund (8.7 billion rupiahfrom 1989 to 1996) the HTI Swakelola is planting onlyteak.

The prospect of further HTI expansion on the mainlandpeninsula is unlikely, however, given the shift in favourof tree crop estates. Forestry officials in SoutheastSulawesi say that the regional government tends toallocate production forest lands to estate uses rather thanHTIs (which are their theoretical use in areas classifiedas permanent production forest). These lands are prizedby all groups because being formally state land they areeasier to acquire from local people. It is very difficult(or at least costly) to get villagers to relinquish Imperatalands and tree gardens to which they lay strong claims.

Photo 14. Timber cut by a village company from a siteintended for HTI swakelola, south Kendar, SouthestSulawesi

Photo 15. ..."Attention...! High fire danger in the dry sea-son. Be careful with fire and cigarette butts"


The pro-estate/anti-HTI bias is illustrated in theexperience of PT Guhara Lestarindo Cellulose. Theywere originally allocated a concession near Kendaricity in a forested production forest zone, but villagersand local officials objected saying it would threatenthe area�s water supply. Guhara was forced to relocateand was given a new site in Tinanggea. Before theycould commence operations, however, their newconcession was revoked and subsequently given to PTPXIV to grow sugarcane. Guhara requested an 80 000ha concession to develop its pulp plantation but hasonly been awarded 17 000 ha. Its whole operation isnow in jeopardy after it lost many trees to fires in thedry season of 1997. Its original concession, from whichit was banned for environmental reasons, is now beingsought by an oil palm company which is reported tohave a good chance of getting approval. Even whereHTIs have so far been successful they will not expand.The south Kendari unit of the HTI Swakelola hasplanted almost all of the land in its concession, onschedule and below budget with reportedly goodsurvival rates, but there are no plans for it to expandfurther.

Bias against HTIs amongst regional governmentofficials stems from their view that land is better usedby cash crop estates because they generate moresubstantial profits more quickly and also providelonger-term employment prospects for villagers. Theofficials are also suspicious that purported HTIcompanies are often more intent on using their cuttingpermits to exploit the existing timber resources of asite rather than develop a productive plantation (LaodeAbd. Rauf, personal communication). They say thisresults in the loss of forests that are already producingrattan and timber and their replacement withunproductive wastelands. In their opinion it is betterthat HTIs be used for the rehabilitation of grasslands,in much the same manner as reboisasi.2

The HTI, Provincial Interests and theTeak Forests of Muna

The one location where the HTI is still seen to have animportant role in Southeast Sulawesi is on the islandof Muna. There are two reasons for this. First, Munais drier than other parts of the province, making it lessattractive to estate companies. Second, the existingteak forests, which date back at least 300 years, are ofeconomic importance to the government and ofconsiderable cultural and historical significance to theprovince. At present poor management of these forestsrisks their permanent loss. It is hoped that developingHTIs will rehabilitate and reduce pressure on the foreststhat remain.

Conditions on Muna and the contribution of teakConditions on Muna island are amongst the mostdifficult in Southeast Sulawesi. The predominantlyagricultural population must contend with relatively lowrainfall and infertile limestone soils. Soil permeabilitylimits supplies of surface water. Farmers make swiddensof dryland rice, more often corn and cassava. Theiryields are low. Land shortages compound theirproblems. Muna has a population density of 54 personsper square kilometre, much higher than the provincialaverage of 35. Exacerbating the situation is the factthat 49% of Muna�s land area is declared state forestand is officially off-limits to farmers (BPS Sultra 1996:242). In response to these difficulties Muna people oftenleave their island, migrating temporarily or permanentlyto Kendari, Maluku, South Sulawesi and as far asMalaysia.

Muna�s teak forests have provided relief from theseharsh conditions. They have traditionally been a sourceof fertile land for conversion to swiddens and of timberfor sale and household consumption. Prior to thiscentury the Sultan of Buton prohibited ordinary citizensfrom cutting teak, reserving it for royal purposes. Suchprohibitions were not strong in Muna: its governmentwas perceived as disorganised, its populationindependent (van Hasselt 1909). Visiting Muna earlythis century, van Hasselt reported that clearing of teakforests for ladang gardens was rife and had been so forsome time, from the number and age of tree stumps.Larger trees were ringbarked, while smaller ones wereused to make heavy fences and houses, with muchwastage. Farmers ignored Imperata cylindrica fieldsthat they had created previously. Forests around thecentre of Muna were under the greatest pressure. Unlessthis exploitation was stopped he anticipated that theisland�s teak forests would be lost. At that time heestimated the teak forests to cover approximately 45 000ha mainly in the sparsely populated north of the island,although this figure is doubted by Muna�s current Bupati,Saleh Lasata (1997: 45). The situation was consideredone of such gravity that in 1909 the Dutch civiladministration and the self-government prohibited allfurther felling.4

Past and present mismanagement of the teakforestsDespite continued prohibitions on farmers cutting teak,it is estimated that only 8339 ha of this valuable forestnow remain on Muna (Hasanu Simon 1997: 74). Muna�scurrent Bupati points to heavy exploitation by the Dutchfrom 1911 and by the Japanese during the World War IIas causing much of the loss (Saleh Lasata 1997: 43).Considerable damage seems to have been inflicted sinceIndependence, however, and the situation is becomingmore desperate as the end of the forests is in sight. In


1968, management of the teak forests was transferredto the provincial government in Kendari from theregency government in Muna. Both governments haveconsistently been more concerned to generate incomefrom the forests than conserve them. Over time theyhave initiated various �management� plans givingpermission for third parties to cut and sell teak timber,with much of the profit returning to regency andprovincial coffers. All of these schemes have resultedin substantial overcutting (Hasanu Simon 1997).

In 1986, in response to continuing forest decline, theprovincial government established a Forest ExploitationAuthority (Badan Otorita Eksploitasi Hutan). This bodywas intended to be an improved institution that wouldmore effectively (and hopefully sustainably) exploit andmarket forest products, including teak, and provideforestry extension to farmers (Sarijanto 1997: 6). Apublic company, PD Perhutanda, was set up to harvestand sell teak and other forest products on Muna andthroughout the province. Perhutanda was directlyresponsible to the Authority which in turn answered tothe Provincial Income Office in Kendari. The companyand its managing agencies were vested with greater realpower over forest management than either the ProvincialForestry Office (Kanwil Kehutanan) or the ForestDepartment (Dinas Kehutanan).

Formation of the Forest Exploitation Authority has nothelped the problem, however, as forest destruction hascontinued unabated (Hasanu Simon 1997: 84).Provincial Forestry officials are highly critical of PDPerhutanda (perhaps reflecting their own powerlessness),suggesting that the rate of forest loss has increased under

its administration. Destruction is driven by the priorityto generate income, with little emphasis being placedon forest maintenance, in which the company has noexpertise.

Perhutanda�s method of operation is to market timberfrom natural teak forests and teak planted by villagersoutside the protection forest zone. In theory wood iscut from private lands and sites intended for conversionto permanent forestry use (such as HTI Swakelola) andagriculture. Much of the natural teak forest in thenorthwestern district of Kambara was felled and soldby the company to make way for an agriculturalintensification project developing wet rice fortransmigrants. Perhutanda contracts individual farmersor small businesses to cut timber, paying them just 7000-15 000 rupiah per cubic metre according to villagesources. The company then sells the timber for around300 000-400 000 rupiah per cubic metre to threesawmills on the island which were set up shortly afterPerhutanda itself in 1987. Perhutanda enters intocontracts with these companies to provide them with aguaranteed quantity of timber at agreed intervals.Forestry officials contend that Perhutanda is underpressure to continue harvesting teak beyond sustainablelimits because of demands from its principals in theprovincial government and from the owners of thesawmills (mostly ethnic Chinese) with whom it hascontracts.

The existence of Perhutanda and the sawmills is alsobelieved responsible for indirectly contributing to illegalfelling of teak trees. Teak theft is an old practice onMuna but is reported to be at dramatic levels now(Hasanu Simon 1997: 85). Most illegal cutting is byvillagers. �Stealing� and selling teak wood (and otherwoods such as fig and mangrove) is an essential sourceof village livelihood, especially in the dry season whenthey cannot grow food crops. During surveys conductedin two villages in Muna�s north, more than half of thehouseholds interviewed readily admitted that they soldteak without Perhutanda approval. Cutting is done bymales who have various techniques for avoidingdetection. In two to four weeks during the dry seasonthey normally cut and roughly process one cubic metreof timber that they sell for between 100 000 and 200 000rupiah. Over the season they may earn a maximum of600 000 rupiah, a good income which is supplementedby cashews sold by other members of the family.Perhutanda�s overcutting is said to be responsible foran increase in theft by villagers, prompting them to makewhat they can from the forests before Perhutanda finishesthem off.

While cutting is done by villagers, and occasionally byteak (and mangrove wood) �raiders� from South

Photo 16. Teak forest, Napabalano district, northern Muna,Southest Sulawesi


Sulawesi and other islands, they are encouraged toengage in this practice from above. Numerous officialsand villagers were heard to make reference to a�syndicate� responsible for organising theft. Whiledetails of such a group are unknown, the sawmills onMuna allegedly ask villagers to cut wood for themwithout Perhutanda�s knowledge. Teak sold under sucharrangements is transferred for about 150 000 rupiahper cubic metre, meaning mill owners get wood morecheaply and villagers earn greater returns than theywould if dealing via Perhutanda. Villagers are alsocontracted to cut teak for buyers in Bau Bau on Butonisland and in South Sulawesi.

Southeast Sulawesi�s forestry agencies have apparentlybeen rendered powerless to stop this overexploitation.For example, the provincial Forest Department awardstimber cutting licences to contractors wishing to cut forPerhutanda. This theoretically gives it the power tocontrol the number of cutters and the rate of exploitation.In reality, however, it merely rubber stamps whichevercontractors are sent to them by Perhutanda. Bothorganisations are under the control of the Governor inKendari. Consistent with the Governor�s priorities, theForest Department must fall into line with Perhutanda�sdirections. As the staff of Perhutanda in Muna say, �Ifthe Forest Department does not agree with the way theGovernor is managing the forests, then the provincialhead of forestry can be changed on the Governor�sorder�. The relevant legislation (Undang-Undang PokokPemerintahan di Daerah No. 5 of 1974) purportedlyasserts that all government departments are the pembantu(assistants) of the Governor.

Forestry agencies have also toiled fruitlessly, with policeand local officials, to apprehend unlicensed teak cuttersand traders in the field. Their efforts are hampered bypoor coordination between agencies and a shortage ofresources and manpower which makes monitoring theforests along the entire coastline of northern Muna adifficult task. Even when they do encounter thieves theyare often ill-equipped to apprehend them. Raiders fromSouth Sulawesi, in particular, travel in bands numberingtens of men and willingly use violence to avoid capture.Moreover, the existence of the �syndicate� underminesthe morale of forestry officials. Officials on Munaquestion who should be punished for teak theft; thecompanies that request the wood, the governmentofficials who turn a blind eye and accept bribes, or thevillagers just searching for a living? The situation isfurther complicated because forest protectors commonlyhave family connections with forest exploiters. Oneforestry official in Raha said nobody from the provincialforestry office in Kendari wanted to be posted to Munabecause it was believed impossible to protect the teakforests from theft.

The only constructive role left for the Forest Servicehas been rehabilitation. Since 1980 they have attempted(under the reboisasi programme) to reforest grasslandareas with teak, but unfortunately have had little successdue to fire. They have also tried to take pressure offforest areas, by encouraging villagers to plant cashewtrees on their private land under the regreeningprogramme. From 1989 they commenced replantingteak under HTI Swakelola. This has been moresuccessful than reforestation but much slower than HTIdevelopments elsewhere. Of the 35 400 ha intended forplanting on Muna, only 1600 ha has been realised (DinasKehutanan Tk I Sultra 1996: 14).

A new plan: cooperation with a State ForestryCompany

To date the provincial and regency governments haveencouraged open exploitation of Muna�s teak forestswith little concern for sustainable management. Localforestry agencies have been moved aside and a businessenterprise permitted to dominate. There is now arealisation, however, that the forest area is in criticaldecline and a new approach is needed to maintain aproductive forest industry. At a conference held inKendari early in 1997, the Governor, the Bupati of Munaand forestry officials and experts from Kendari, Munaand Java, acknowledged the problem and discussed astrategy for better management.

At stake is an industry described as a mainstay of Muna�seconomy. From 1992/93 to 1996/97 the forestry sectoron Muna (mostly through teak exploitation) provided52% of the total wealth generated within the regency(Departemen Kehutanan Tk I Sultra 1997: iv). Overthe same period it generated 2210 million rupiah forMuna�s government from taxes and fees (Saleh Lasata1997: 51). Forty per cent of the income received fromteak sales on Muna goes to the regency government and60% to the provincial government, with one-third of that60% being channelled to Jakarta. Timber production(mostly teak) has increased under Perhutanda.Production for the last five years totalled more than24 000 cubic metres; this does not include informaltimber cutting by villagers (and other �thieves�), whichmust generate considerable income.

Muna�s teak forests also have considerable historicaland cultural importance to many people in SoutheastSulawesi, especially the educated elite. Origins of theteak trees have long been debated. Dutch colonialistsspeculated that they were natural, while others said theywere brought from Java by a trader from Maluku (SalehLasata 1997: 42). It is now widely believed that thefirst Islamic king of Tiworo in Muna�s northwest wasgiven teak trees by the Sultan of Demak in Central Java


when he made a pilgrimage to the sultanate in thesixteenth century (Adurrauf Tarimana 1997: 65; HasanuSimon 1997: 81; Sarijanto 1997: 5). Upon returning toMuna he decreed that farmers should replant their ladingwith teak after cultivation, leading to its rapid spread(Hasanu Simon 1997: 81). Whether true or not, thisstory�s popularity reveals the immense significance ofMuna�s teak forests to the modern inhabitants ofSoutheast Sulawesi. Muna�s teak is a living reminderof their historical connection with the centre of Islamicreligion (Demak) and the centre of power (Java) in theIndonesian nation. This is a source of immense pridefor a strongly religious people living in an undevelopedand neglected province who are conscious of the needto establish their place and identity in the modern state.

To preserve these benefits, participants at the Kendariconference agreed in principle to adopt a new approachto forest management which has some radical differencesfrom the current system. Of most significance is adecision (yet to be finalised) to break the power ofPerhutanda and invite one of the state forestrycompanies, either Perum Perhutani or Inhutani, to cometo Muna and manage the forests in a cooperativerelationship with Perhutanda and local forestry offices.Perum Perhutani is the favoured candidate. Itsexperience in teak management in Java is highlyregarded in Southeast Sulawesi and companyrepresentatives were invited to describe their methodsat the conference. It was agreed that one of these SFCsshould take over and greatly expand teak HTIs as thebasis for improved forest management.

Cooperating with a SFC is radical for SoutheastSulawesi�s government because it will result in the lossof autonomy over the resource. They will lose controlover management direction and have to further divideincome earned. The government appears resigned tothe change, confessing they have neither the expertisenor, more importantly, the capital to finance the forestrehabilitation required. Local forestry agencies aresupportive of the proposed policy although they willhave no control over the activities of a SFC and willmost likely remain on the sidelines. On the other hand,losing autonomy over the resource at this time may notoverly concern Southeast Sulawesi�s government. Theyhave exploited the forests fully in recent years and it issmart policy to now get central government money andexpertise to set up a plantation-based industry in theirplace. Inviting a State Forestry Company to Muna mayhence have less to do with conserving the remainingforests and more to do with creating a new �cash cow�when the natural teak is finished.

Methods for reducing theft are the other majorcomponent of the improved forest management strategy.The government has set up a multi-agency team toinvestigate and prevent teak theft. Supervision will bemore rigorous and those caught stealing will receiveheavier penalties (Saleh Lasata 1997: 58). Forestboundaries will also be delineated more clearly. Toreduce villager dependence on theft they will beencouraged to �participate� in reforestation activities. Aswell as providing alternative income this is intended todevelop feelings of ownership over the programme andmake them feel responsible for its success. Otheralternatives will also be developed, such as the furtherexpansion of smallholders� cash crops, especiallycashew (Departemen Kehutanan Tk I Sultra 1997: iv).

The regency government�s willingness to addressMuna�s forest loss is commendable. There are realdoubts, however, surrounding the ability of the chosenstrategy to succeed. Of greatest concern is the emphasisplaced on SFC-managed HTI as the core forestmanagement technique. The track record of Inhutaniand Perum Perhutani in other provinces does not instilconfidence. Moreover, the performance of HTISwakelola on Muna so far, even when combined withthe development of smallholder cash crops, suggests thatthis technique may be unable to provide farmers with aviable alternative livelihood capable of reducing theirdependence on forest exploitation.

Villager experience of HTI Swakelola on MunaVillager involvement in HTI Swakelola is similar toclassical HTI projects throughout Indonesia. Villagerswishing to participate in the project are primarily

Photo 17. Protected in a forest reserve, this is one of thelargest teak trees remaining on Muna, Napabalano district.


involved in plantation establishment. Each participatinghousehold is given a 2 ha plot to maintain. They clearthe site and then plant and maintain teak trees for twoyears. In return they are formally entitled to 264 200rupiah each year (Dinas Kehutanan Tk I Sultra 1996:17). They may also intercrop the juvenile teak trees forthe first year after land clearing. It is estimated by theForestry Service, perhaps over-optimistically, that theymay earn up to 5 tons of dryland rice, 1.2 tons of cornand 300 kg of other vegetables from this tumpangsariactivity (Dinas Kehutanan Tk I Sultra 1996: 17).Villagers may also be given permission to sell timbercut from the site they are managing. After two yearsvillagers stop maintenance and the trees are left to grow.They get no other benefits from the project. They donot get ownership rights over any of the land or trees.Only teak and other commercial timber species areplanted. There are no fruit trees that they may harvest.

A random survey of forty households in two villagesinvolved in HTI Swakelola in northern Muna revealedalmost unanimous dissatisfaction with the activity. Somevillagers did accept the project had advantages. Theymost often cited the chance to undertake tumpangsariactivities and grow dryland rice, which was particularlygood for those with no land. They also made referenceto the wages and opportunity to sell timber cut duringland clearing. Most villagers said, however, that theproject�s disadvantages outweighed its advantages orthat it had no advantages for either them or their village(Table 4.2).

From the villagers� perspective the programme isunpopular because it does not provide them with a long-term productive livelihood, and by consuming much ofthe land within the village boundaries it limits theiroptions for establishing alternative livelihoods. Everyrespondent in the two villages said there was not enoughland in the village for them to expand their agriculturalactivities. The HTI exacerbated this shortage, generatingresentment. Villagers also dislike the project�senvironmental impacts. HTI Swakelola is usually sitedon existing forest which is cleared before planting. Thisdestroys a productive resource for villagers, forcing themto travel further to harvest forest products. Destroyingexisting forest also threatens water resources. Thisimpact was more pronounced with HTI Swakelola inSouth Kendari, where 35% of respondents in two SouthKendari villages said that springs had gone dry sincethe natural forest was cleared. Poor management of HTIconcerns villagers because nothing may be left in placeof the natural forests.

Judging by this experience, expanding HTI under themanagement of a SFC will merely make life moredifficult for ordinary villagers, unless a significantly

different model is developed that provides them with agreater share of benefits over the long term. The HTIwill prevent them from accessing new land foragriculture and, together with greater policing, willfurther limit their ability to harvest timber from the forest.There will hence have to be great efforts to intensifyagriculture on farmers� existing holdings, not only toimprove their living standards but also to make up forthe substantial income lost from their inability to harvesttimber.

The alternative livelihood persistently emphasised is theintense management of estate crops, mainly cashew treeson Muna. As a result of agriculture and forestrydepartment programmes in the past, all households withland in the survey villages currently possess somecashew trees. Each household has somewhere between50 and 100 trees, usually planted at about 10 by 10 mspacings on approximately 0.5-1 ha of land. This isoften all the land a household possesses, apart from thatbeing used to grow food crops and the house garden.These cashew trees may reliably produce somewherebetween 200 and 400 kg of fruit per season, sold forabout 1500-2000 rupiah per kilogram. A household canthus earn about 300 000-800 000 rupiah per year from

Table 4.2. Villager perspective of HTI Swakelola dis-advantages

* 40 villagers were asked whether they thought the project hadany disadvantages and if so what were the main ones. Somerespondents offered just one major disadvantage, while others gavetwo or three.

Source: Survey conducted in November 1997 by staff of the Agri-culture Faculty, Universitas Haluoleo, Kendari, for this research.

Disadvantages of HTISwakelola

Percentage ofrespondents*

Reduces land available forfarming (especially for youngfamilies)

28

Provides only temporary income 15

Poorly maintained afterestablishment

15

Destroys existing forest whenestablished

13

Poorly planned and supervised 8

Villagers get no rights of land ortree ownership

8

People from other villages areused to maintain

5

Increases distance one musttravel to harvest forest products

5

Wage promised was notequivalent to the wage received

5

Wild boar hide in the teak 5

Reduces water flows and driesup springs

5


their cashew trees. If farmers are prohibited fromcutting teak, which currently earns them up to 600 000rupiah per season they will have to double their earningsfrom cashew trees, if that is the only long-termalternative livelihood available.

It appears, however, that increasing production fromcashew groves without increasing the area planted willbe extremely challenging. Villagers already citenumerous problems with cashew trees. The quantityand quality of yield is highly variable from year to year,being extremely sensitive to minor variations inmanagement and climate, particularly wind anddrought. The leaves and fruit are also highly susceptibleto pests and disease. The government is hoping to lessenthese problems by introducing a hybrid variety ofcashew from Sri Lanka. The attitude of farmers towardscashew tree management is also a constraint. They areunfamiliar with intensive management techniques andin the past have often only shown interest in cashewplanting because of government extension and as ameans of claiming land (Yap et al. 1992: 24). Further,this is perhaps an indication that productivity can beimproved if farmer attitudes can be changed. Villagersmay have had no incentive to manage cashew treesseriously yet because of the ease of cutting and sellingteak. With stricter penalties cashews may become amore attractive option.

Other reasons for pessimismUnderlying the problems inherent with HTIprogrammes in Southeast Sulawesi, and indeedthroughout Indonesia, is poor communication betweengovernment officials, company staff and local people.This prevents the development of HTI programmes thatare consistent with local peoples� priorities whileremaining in accord with those of the company. It alsoimpairs the ability of companies to promote programsamongst local people even when intending to be ofassistance.

Discussions at a HTI site in northern Muna provided aperhaps unrepresentative but telling example of thisproblem. A villager acting as foreman for the project,when asked, said that the major problem in the villagewas a shortage of land belonging to villagers. Hecomplained that all of the land was owned by the state,mostly classified as forest land, and even land used forfood crops could be claimed by governmentprogrammes in the future. This uncertainty meantvillagers were discouraged from planting estate treesand developing their village. No more than five minutesafter this statement a government official appeared andproceeded to give his view. He said the major problemin all rural areas was that too much land was in the

possession of villagers. The government had no rightover this land and so could not develop it because thevillagers owning it were uninterested and did notappreciate the importance of development. For thelength of time the official spoke, the foreman sat silent.Regardless of who actually controls the land, the realproblem was this silence. The government rarely seeksand does not value the views of villagers. When it doesseek their viewpoint, it is only for the purpose ofchanging those views or to illustrate the reasons whythe government�s plan is superior. As governmentofficials do not listen, villagers do not communicate;instead they passively resist the government�s clumsyinitiatives.

A final reason for pessimism is the performance so farof Perum Perhutani in another eastern Indonesianprovince, East Nusa Tenggara (NTT). All of theproblems experienced by HTI swakelola in SoutheastSulawesi are replicated in NTT where Perum Perhutanihas been working since 1991, together with a provincialcompany and local forestry agencies. The company,intending to plant a massive 332 500 ha with mostlytimber trees (Tectona grandis, Gmelina arborea,Swietenia macrophylla, Eucalyptus urophylla), has notmanaged to provide villagers with sustainablelivelihoods, has generated considerable resentment bytaking their land and natural forest resources and hascommunicated poorly (Pellokila no date, 1997). It hasused government officials and the military to coercecompliance from villagers, subjecting them to terror andimprisonment as they try to retain control over their landsand resist a programme that they perceive will not benefitthem (Pellokila no date). With this track record therecan be no confidence that the State Forestry Companywill be able to introduce an enlightened form of HTI inSoutheast Sulawesi.

Summary

Southeast Sulawesi�s provincial government is attractingstate and private companies willing to set up estates asits top development priority. This is consistent withRepelita VI aims and trends occurring in other provinces.In the face of this policy HTI projects have beensidelined. They are not favoured by provincialgovernment planners who prefer to give estatecompanies the opportunity to convert forest lands ratherthan hand them over to permanent timber productionby HTI. The one exception is on Muna which isunattractive to estate crop companies and wherepreservation of the teak forests is important. Theperformance of HTI Swakelola so far, however, revealsthat this type of project jeopardises the ability of villagersto obtain an adequate livelihood in a land- scarce


environment. SFCs operate in essentially the samemanner and so it is unlikely that they will stop thedegradation of Muna�s forests because local people willremain dependent on these resources. HTIs have beengiven a reprieve from provincial extinction on Munabut they are ill-equipped to perform the task asked ofthem.

Endnotes

1 As often occurs there is considerable variation in theforestry data depending on the source. In this instancethe data provided by BPS Sultra 1996, reporting thatabout 60% of Southeast Sulawesi�s land area is forest

zone, is more widely accepted. These data are derivedfrom the RePPProT studies, as already presented forWest Kalimantan and Jambi.2 Reboisasi is a program controlled by the Forestry Ser-vice to reforest degraded lands in the forest estate. Theprogram is described in Chapter 1.3 Including sale to the Dutch East India Company in theseventeenth and eighteenth centuries, although not on aregular basis.4 The self-government of the area was the administra-tion of the Sultan of Baubau on Buton island, whichoperated in a semi-autonomous fashion during part ofthe Dutch period.

CHAPTER 5GENERAL CONCLUSIONS

The boom in demand for oil palm nationally andinternationally is attracting the interest of wealthyinvestors and regional governments in West Kalimantanand Jambi, as well as in other provinces, especiallySumatra and Kalimantan. They are conspiring to speedthe spread of private oil palm estates, which has alreadyhad a great impact on competing land uses and traditionallandowners at the local level. Even in SoutheastSulawesi, which may be thought of as distant from themain centres of action, oil palm is establishing itself andattitudes favour estate tree crops.

The emergence of oil palm is to the detriment of otherland uses, including other tree planting activities. Inboth Jambi and West Kalimantan, the regionalgovernments� approaches are not balanced, and adisproportionate quantity of resources, especially land,is being made available to this one activity. The beliefis that oil palm plantations will allow the regions to reachtheir goal of economic growth in the shortest possibletime, eliminate poverty, and provide suitable sites forrelocation of displaced populations. Other large-scaleactivities have difficulty securing sufficient land to besustainable and smaller-scale activities must find theirplace around the periphery. In this sense the countryrisks becoming too dependent upon this one crop. Theregional economy could be destabilised if the price ofpalm oil falls or the productivity of these huge areas ofyoung oil palm cannot be sustained. Oil palm estatescannot support the range of interest groups pursuingtraditional activities and maintaining diverse naturalresources which characterised the previous occupationof these lands.

International NGOs and scientific organisationsoperating in these regions have been permitted to carryout research projects aimed at assisting traditionalsystems. Often such projects emphasise the positiveaspects of local livelihood activities, such as biodiversitymaintenance, when they attempt to engage theconsideration of regional government authorities.Incorporation of traditional complex agroforests into amodel for buffer zone management would seem a logicalstep, or permitting local people to sustainably manage alogging concession. However, although suchorganisations are listened to politely, their concerns areseen as only marginal to regional agendas. The smallscale of many of these projects, such as the ICRAFRubber Agroforestry System, means that they arescarcely taken seriously when they seek to changeaccepted practices. Even local villagers perceive suchactivities to be of only minor importance when quickeconomic results do not appear to be forthcoming.

Projects run by foreign organisations are generallyencouraged, as there is status involved in attractingforeign attention, the possibility of extra resources beinginjected into local areas and lucrative counterpartpositions becoming available. But smaller-scalescientific studies are not perceived as having muchbearing on the broader picture, especially when theyadvocate a change in attitudes to local smallholderswhich runs counter to official entrenched stereotypes.While recent political changes have brought enhancedfreedom of expression in Indonesian urban society andincreased activity of local NGOs on behalf ofmarginalised people, it is doubtful whether changes inattitudes have penetrated far into the regions, where oldhierarchies and mindsets remain largely intact. One mayhope that the models provided by independent outsideresearch will indicate alternatives which may be takenup by these NGOs and other lobby groups in their pushfor reform. Lobbying at regional level would appearcritical if change in land policy is to be achieved.Unfortunately present economic imperatives are morelikely to justify conservatism, at least in the short term.

In the past, the economies of both West Kalimantan andJambi, as representing the wider regions of Kalimantanand Sumatra, were heavily dependent upon logging.This exploitation was controlled by the powerful andprovided few direct benefits to ordinary citizens. In fact,when local people attempted to exploit forest productsin their usual ways to sustain their economies, the resultwas often confrontation. Oil palm estates seem to comefrom the same stable of land uses and have inheritedsimilar characteristics. That oil palm is now of interestto companies with existing investments in logging andtimber plantations reinforces this view. The effects ofoil palm estates upon local people, however, may bemore insidious. With some exceptions, these estates donot appear to provide smallholders with sustainablelivelihoods. They also consume vast areas of land,making it more difficult for people to seek alternativeincome sources. In this way oil palm represents the finaldispossession of villagers� land which began with thearrival of the logging companies. This developmentalclimax was made possible by legal, environmental andsocial conditioning that occurred throughout the NewOrder period. The forest classification system providedthe legal basis, while logging degraded the natural forest,speeding the need for it to be �rehabilitated�.

Years of top-down extension have rendered localsessentially passive recipients, at least superficially.Where resistance has occurred it has tended to be covert(such as redirection of fertiliser intended for oil palm to


annual crops), as local people reacted to the relativelybenign intrusions of the older generation of estates.However, as was pointed out in the West Kalimantanexample, the private companies are beginning to copythe tactics of the classical HTI plantations and subjectvillagers to intimidation and bullying in order to securetheir land. Since the economic crisis and the change ofgovernment, local people have begun to fight back moreovertly, their efforts being supported by a consortium oflocal NGOs, including the influential WALHI (WahanaLingkungan Hidup Indonesia, the Indonesian Forum forthe Environment) through their new �Sawit Watch�initiative. One may cite the example of the campaignagainst PT Perkebunan Torganda, a company withholdings in North Sumatra and Riau, after a seriousconfrontation in South Tapanuli (North Sumatra)between villagers and company employees attemptingto plough village land for oil palm (WALHI 14/8/98).

Contempt for local livelihood systems has also beendemonstrated by the widespread tendency to usetransmigrant labour in preference to local wherever majorprojects have been established. This overlooking of thepossible contributions of local people and the specialtreatment given to transmigrants has created wideresentment, especially where religions and cultures ofthe two groups are far apart, as evidenced in the 1997Dayak uprising against Madurese in West Kalimantan.

If the current imbalance in regional development is notaddressed there is a risk of further social upheaval. Todate many villagers have willingly participated in oil palmprojects. To a large extent, however, this willingness

has come from positive perceptions of the moredevelopment-oriented, generous and World Bank-backedPIR model. The cooperative version of the �partnership�model, as being developed in Jambi, seems also to beaimed at assisting local people, but continues toperpetuate patronising and �top-down� approaches whichlimit their freedom to make their own decisions. Modernestates are not backed by the World Bank or the resourcesof central government departments, but by Indonesianand Malaysian conglomerates.

In Peninsular Malaysia the FELDA schemes, set up torelieve poverty among rural Malays during the 1970s,eventually devolved responsibility to local farmers. Theywere, however, expensive; having achieved their politicaland economic objectives, they have been largely replacedby pure plantations using a hired labour force. The secondgeneration of FELDA settlers has left the land to work inindustry, while the estate labour force consists mainly ofimmigrant Indonesians. When Malaysian estate interestsmove into Indonesia to plant oil palm, they will not beinterested in recreating FELDA schemes, or any otherkind of land settlement. Neither they, nor their Indonesianconglomerate counterparts, are moving into oil palm withany social objectives. The relative production costs,estimated before the financial downturn at US$150 perton in Indonesia, as against US$200+ per ton in Malaysia,largely explain their interest (SWA, July 1997). Theapproval which the IMF has given to oil palm in its mostrecent rescue package for the Indonesian economy liesin its support for unconditional foreign investment andexpansion of exports, among which tree-based cash cropsfigure largely. But what kind of oil palm plantations aremost likely to be established in these times of economiccrisis? In his survey of the most efficient sections of theindustry, Larson (1996: 33) quoted a cost figure in 1993of $127 per ton for SOCFINDO estates in North Sumatra.It is interesting to read Stoler�s description of thereduction of labour costs on SOCFINDO�s estatesbetween 1967 and 1977. Plantation oil palm has thelowest labour intensity of any estate crop. What is more,it allows temporary, rather than permanent workers tobe employed (Stoler 1985: 167). Future directions forthe industry may well follow this path. Even when�partnerships� with local people are officially stated toexist, there is uncertainty as to what the arrangementswill actually be. A minimum of local participationappears often to be the aim, which would quickly erodeany remnant villager support.

The economic crisis is likely to result in some �shakeout� in the industry, with elimination of speculators andmarginal producers, together with delays in bringing intofull production some properties already partiallydeveloped. The change of government and continuingpolitical and financial uncertainties have also delayed thearrival of some of the foreign investors. However, the

Photo 18. Shrouded by smoke, the sandy bed of theKapuas river at Sanggau was exposed during theenvironmental disaster of 1997. Although caused by droughtthis time, could forest conversion make this an increasinglyregular phenomenon in the future?


indications are that interest from Malaysia remains strong.Given the low Indonesian production costs andcontinuing world demand, the industry is predicted torecover quickly from any financial setbacks and allindications are that the expansion recommended by theIMF will take place.

This situation is likely to exacerbate the problems of localpeople. It was recently admitted that subsidised fertilisersearmarked for small farmers (especially food cropgrowers) had ended up instead with plantation companies.Most of the misconduct in distribution (through collusionwith state fertiliser company officials) was said to haveoccurred at regency level and in the warehouses of villagecooperatives (Jakarta Post 10/6/98). Meanwhile, small-scale oil palm producers already in PIR-type schemes(and forced to buy fertilisers from their �parent�companies) find that their input costs have escalatedenormously, but wages have not increased.

A further demonstration of the attitudes of the plantationcompanies concerns the problem of domestic suppliesof cooking oil, now mainly derived from palm oil.Record exports of palm oil in June-November 1997 (up80% over the previous year), led to a sizeable reductionin Indonesian stocks (Oil World 28/11/97). The poorseason, with drought and smoke affecting crops, alsobrought reduced yields. World palm oil prices rose inthe first quarter of 1998 after Indonesia placed a ban onexports, following the run down of stocks and increasedlocal demand (Oil World 9/1/98, 20/3/98). The ban waslifted in April and new export taxes introduced (up to40% on CPO). Unfortunately this move has not led tothe stability desired, as the continuing disparity betweenlocal and world market prices has encouraged firms toexport the bulk of their palm oil products. Widespreadsmuggling has been reported, especially from Sumatra,by companies attempting to avoid the tax (Jakarta Post21/7/98). Even a lifting of the export tax to 60% of thevalue, which took place in early July, appears to havehad only minimal effect on availability of local supplies.As long as the rupiah remains at its present low levels,exports will still be more profitable than domestic sales,with or without smuggling (Jakarta Post 7/8/98).

One example, from an officially listed company, revealsthe kinds of profits possible as a result of the financialcrisis. PT Astra Agro Lestari, a subsidiary of PT AstraInternational, posted a profit of 29 billion rupiah in thefirst quarter of 1998. Of its almost 200 000 ha ofproductive plantations, 92% are in oil palm. Thecompany explained that many of its dealings were indollars, so the fall in the rupiah had not affected it greatly;it had also benefited by the high international price ofCPO. Given the export ban in force during that quarter,one can only conclude that much of the product musthave been smuggled overseas, even though the company

claimed that only 5% of its crude palm oil was exported(Suara Pembaruan 24/7/98). As the Jakarta Postpondered in a recent editorial: �It was most puzzling tonote how the domestic market remained short of stockduring the first four months of this year even though theblanket export ban was still in effect... with an annualoutput of more than six million metric tons and a domesticdemand of only about 3.5 million tons, the countryactually has an exportable surplus of more than twomillion tons...The potential profit had become so big, asa result of the 80 per cent devaluation of the rupiah, thatthe temptation to smuggle, through collusion with localofficials, was hard to resist�(Jakarta Post 7/8/98).

The increasing dominance of estate crops has importantimplications for those involved with forestry. Of greatsignificance has been the relative decline of industrialtimber and pulp plantations (HTI), which can be attributedin part to the rise of oil palm. In order to survive in theface of local, national and international pressures, someHTI companies have devised ways to be conciliatorytowards local people. Those who allocate capital andland, however, have scorned this approach. They havemerely turned to oil palm which, since it has been takenover by private conglomerates, has appeared more likelyto give investors and regional officials the short-termprofits that integrated HTI is no longer prepared toprovide. In Southeast Sulawesi the same preference forestate crops over HTIs, especially in the production forest,has been noted on the part of the regional government.The only exception appears to be the teak forests of Munaisland. There the current arrangements with the provincialForest Exploitation Authority, through its company PDPerhutanda, have tended to increase teak theft andovercutting. A proposal to invite one of the State ForestryCompanies to manage the forests in a classical HTIsystem, will mean the loss of provincial control over alucrative business. But even State Forestry Companieshave been allowed to diversify into oil palm. InhutaniIII, which suffered considerable losses in 1997 due toforest fires, plans to develop 60 000 ha of oil palm onsome of its 300 000 ha of forest concession in West andCentral Kalimantan (Suara Pembaruan 23/6/98).

It must also be recognised that the former Ministry ofForestry was never very influential in determining realland use on the ground. While the Ministry hadundoubted legal control over large tracts of Indonesia�sland area, in reality, because of the way Forestry officeswere set up in the provinces, power over its implementingagencies rested with the Governor. As Daryadi andNasendi (1995: 9) observe:

�The Provincial forest services (Dinas Kehutanan)are responsible for implementing directives withrespect to programmes and project activities, but theirauthority derives from the Governor under another


Ministry, i.e. Ministry of Home Affairs. Outside thecapitals, they are isolated, lacking support facilities,and unsure of their responsibilities. And at no levelis there clear accountability. Inevitably, tensions ariseand personalities become important in decisionmaking and implementation.�

It had been hoped that the smoke/haze crisis of late 1997would result in recognition that the Forestry andEnvironment Ministers needed to have their powersincreased to avoid similar disasters in the future. Eventsimmediately following the disaster indicated that thiswould not happen. The former Forestry Minister,Djamaludin Suryohadikusumo, and former State Ministerfor the Environment, Sarwono Kusumaatmadja, had beenpraised by environmentalists for their forward thinkingapproach and tough stance towards exploitative businessactivities. Djamaludin in particular backed ecolabelling,blocked inappropriate developments on state forest landand variously tried to scrutinise, sanction and slow theactivities of pulp, logging and oil palm companies (vanKlinken 1997). All of Djamaludin�s efforts failed,however, as influential businessmen relied on theirpolitical connections at the central and regional levels toignore his protestations.

In response to the smoke/haze disaster Djamaludin actedcharacteristically. In early October he released a list of176 plantation, timber and construction companies andtransmigration schemes suspected of large-scale burning;most of these were oil palm companies (van Klinken1997). It was hoped that the extent and public nature ofthis disaster would result in the prosecution of thesecompanies, an act that would have finally shown theForestry Ministry�s teeth. It was not to be. Soon afterDjamaludin�s announcement, the number of companieson his list was reduced by 30. By the end of Novemberthe IPKs (permission to cut wood) of only 66 companieshad been withdrawn, and most of these were later restored.No logging companies had their 20-year concessionsrevoked and there were to be no public investigations ofplantation owners (Vidal 1997). Politically well-connected companies were unscathed and allowed tocontinue operations, while El Niño took the blame

The Ministry of Forestry was not an influential policymaker or a force for change, but rather an instrumentwielded by those with real power at the central andregional levels, together with their business partners, tocontrol and extract profit from the nation�s resources. TheMinistry was used and in the end it too was disadvantaged.Forestry as such has now lost its key position, as indicatedby the renaming of the Ministry as the Ministry of Forestryand Estates. Such a name change acknowledges the newreality of the widespread clearing of logged-overproduction forest for estate crops, especially oil palm.

While permission from the Minister of Forestry haspreviously been needed to reclassify the land, it is notclear whether such permission will still be required. Inany case it was generally regarded in the provinces aseasy to obtain. While there had been occasional examplesof the forestry department fighting back, refusing permitsfor companies to begin clearing on the grounds that theywere simply stealing timber, such cases were infrequent.

It is still uncertain whether the new minister (who is nota forester, but trained in agriculture) will be able toinstitute major changes in the organisation and controlof the forest estate. Some licences have been cancelledand an inventory of existing licensees is currently underway. At the IMF�s insistence a system of auctioningnew concessions will be introduced. It has beensuggested that under such a system the concentration ofconcessions in the hands of a few large consortia mightbe reduced, giving cooperatives of local people morechance to gain concessions. While such an ownershipchange has also been called for by NGOs, it is unclearhow the auction system might operate, or how the localcooperatives would be financed. Meanwhile, it has beenrecognised that the economic crisis is likely to lead togreater pressure on the forests. Pressures will come fromcontinued need for timber supplies as plywood demandbegins to pick up, from conversion to estate crops(currently more lucrative than timber), from new forest-based mining projects and not least from impoverishedlocal and outside people moving into the forests to seekboth food and saleable products (CIFOR 1998).

There has been some hope that reform of the functionsand powers of Indonesia�s bureaucracy might come outof the recent political changes resulting from theeconomic crisis. There have been calls for greatergovernment and business accountability to restoreinvestor confidence in the economy. Unfortunately, suchreform will probably be restricted to the financial andbanking sectors. When it comes to the exploitation ofresources and production of commodities it is the naturalenvironment and traditional landowners that tend to bethe victims of poor accountability, not wealthyinternational investors. It is more likely that economicneed will be rationalised as justifying the most �efficient�use of the land resource, rather than the mix of usesessential to fulfil the needs of a just society.

Endnotes

1 Transmigrants returning from work on an oil palm es-tate in Irian Jaya were killed by OPM militants, an indi-cation of the dangers inherent in extending thesetransmigrant-based estates into areas where thegovernment�s control is seriously contested and theJavanese are not welcome.

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West Kalimantan (Sept/Oct 1997)

Baba Saiful Barkah - Assistant Unit Manager Sintang,PT Finnantara Intiga, Sintang

Bacrun Nurjadi, Ir - Ketua, Bidang Kehutanan, Fak.Pertanian, Univ. Tanjungpura., Pontianak

Bamba, J - Institute of Dayakology Research andDevelopment, Pontianak

Budiman, MA - Badan Pertanahan Nasional, Land useplanning and mapping project, Pontianak

Dadan, Ir - RLHK and formerly SFDP, ProvincialForestry Department, Pontianak

Daliman, T - LBBT, Pontianak

Donatus Rantan, Drs - Assistant Director, Yayasan DianTama, Pontianak

Durr, M - Economist, SFDP, Sanggau

Fulbertus Amre - Economist, PT Sinar DinamikaKapuas, oil palm company, Semuntai

Goran Adjers - Training Manager, Planning Directorelect, PT Finnantara Intiga, Pontianak

Haryono - Site manager, PT Multi Prima Entakai, oilpalm company, Semuntai

Lim - Site manager, PT Lahan Cakrawala, Sintang

Mangan, HL - Kep. Bidang Tata Usaha, DinasPerkebunan Tingkat Dati I, Pontianak

Mudiyono, Prof. Dr - Ketua, Lembaga Penelitian,Universitas Tanjungpura

Muis Ishak, A - Assisten II Bupati, Ekonomi, PemdaTingkat II, Sanggau

Nazmi, Ir - Dinas Kehutanan Tingkat II, Sanggau

Nurjanah Anwar Saleh, SH MH - Fakultas Hukum,Universitas Tanjungpura

Rudijanto Utama, Ir - Director, Yayasan Dian Tama,Pontianak

Sasrudin M Sattin, Ir H - Forestry Department KPH,Sintang Selatan

Setiman - Ketua Bappeda, Tingkat II, Sanggau

Sipayung, Ir W - Administrator, PT PerkebunanNusantara XIII, state oil palm co., Parindu

Soetrisno - Kep. Bidang Reboisasi dan RehabilitasiLahan, Prov. Forestry Dept., Pontianak

Sugiman - Yayasan Swadaya Dian Khatulistiwa,Pontianak

Sutrismo, Dr L. - Sekretaris, Lembaga Penelitian,Universitas Tanjungpura

Staff of World Wide Fund for Nature, Pontianak

Staff of PRC Foundation, Pontianak

LIST OF PEOPLE MET

Village head, village leaders and farmers - village ofBali, Sanggau

Village head and village leaders - village of Batubuill,Sanggau

Village head and farmers - village of Sungai Kunyit,Sanggau

Village secretary - village of Tapang Semadak, Sintang

Jambi (Nov. 1997 and Feb. 1998)

Amrie Ramli Ir. - Kep. Dinas, Dinas Perkebunan Tingkat1, Jambi

Asrizal Malano - Pusat Studi Lingkungan, UniversitasJambi

Daniel Sri Wirahono - Forestry Affairs Dept., PTWirakarya Sakti, Jambi

Dedi - Dinas Kehutanan, Jambi

Dikin Laudji - PT Wana Perintis (HTI Trans), Sarko

Fernando Potess - Project Manager, ISDP project,Berbak National Park

Frans Randipau - Kep. Dinas, Dinas Kehutanan TingkatII, Tanjung Jabung

Helmi - PT Krisnaduta Agroindo, Sarko

Idris Sardi - Yayasan Gita Buana, Jambi

Ketua Kelompok Tani - PT Gatra Kembang Paseban,Kec. Mersam

Luis Betancour - Indonesia-UK Tropical ForestManagement Programme

Manager - PT Bahari Gembira Ria, Kec. Kumpeh Ulu,Kab. Batanghari

Manager - PT Gatra Kembang Paseban, Kec. Mersam,Kab. Batanghari

Machmud Simpoha - Adviser, Indonesia-UK TropicalForest Management Programme

Mastam Bustaini - Fakultas Pertanian, Universitas Jambi

Rosyani - Fakultas Pertanian, Universitas Jambi

Rowland I. - Indonesia-UK Tropical Forest ManagementProgramme

Salim Ir. - Sekretaris, BAPPEDA, Jambi

Saman Chatib - Bupati, Kabupaten Batang Hari

Staff - Dinas Kehutanan Tingkat I, Jambi

Staff - Dinas Kehutanan Tingkat II, Sarko

Staff - Dinas Perkebunan Tingkat I, Jambi

Staff - Dinas Perkebunan Tingkat II, Kerinci

Staff - Kanwil Kehutanan, Jambi

Staff at log pond - HTI Tanjung Johor, Desa Jelatan,Kab. Sarko


Staff - Kantor BAPPEDA, Tingkat I, Jambi

Staff - Kantor BAPPEDA, Tingkat II, Bungo Tebo(Bute)

Staff - Kantor BAPPEDA Tingkat II, Kerinci

Staff - Kantor BAPPEDA Tingkat II, SarolangunBangko (Sarko)

Staff - Kantor TNKS, Kerinci

Staff - Forest Ranger post, TNKS Gunung Tujuh,Kerinci

Students - PSL, Universitas Jambi

Thomas Alpa Edison - Yayasan WARSI, Bangko

Tjetjep Ir. - Dinas Kehutanan Tingkat II, Muara Bulian

Villagers - Desa Lubuk Pauh, Kayu Aro, Kerinci

Village head�s wife and villagers - Desa Lempur, Kerinci

Village head and villagers - Desa Muara Buat, RantauPandan, Bute

Workers - PT Gatra, Mersam and PT Gembira Ria,Kumpeh Ulu

Southeast Sulawesi (Oct. 1997)

Abdul Gafar - Head, Govt. and Administration Branch,Provincial Forestry Office, Kendari

Bahrun Ir A. - Lecturer, Agriculture Faculty, UniversitasHaluoleo, Kendari

Budi Hardjo, Drs - Kepala Bagian Tata Usaha,Provincial Forestry Office, Kendari

LaNdimasa - Kepala, Dinas Kehutanan, Tingkat II,Kendari at Unahaa

Laode Abd. Rauf, Prof Dr H. - Ketua Bappeda Prop.Dati Sulawesi Tenggara

Manan, Ir A - Head, Pusat Studi Lingkungan,Universitas Haluoleo, Kendari

Sudjud, Ir - Kepala, Dinas Kehutanan, Tingkat I, Kendari

Sukarya, NG - Dinas Kehutanan, Tingkat I, Kendari

Syahrir, Ir - Dinas Kehutanan, Tingkat II, Kendari

Staff of Perhutanda, Tingkat II, Muna

Yusuf P. Bulo - Kabid Penelitian, Bappeda Prop. DatiSulawesi Tenggara

Village head and villagers at Buke village, Tinanggeadistrict, Kendari

Village head and villagers at Lahaji village, Kusambidistrict, Muna

Village head and villagers at Langkumapo village,Napabalano district, Muna

Village head and villagers at Rambu-Rambu village,Lainea District, Kendari

Village head and villagers at Tangkumaho village,Napabalano District, Muna

Village head and villagers at Watumeeto village, LaineaDistrict, Kendari

Others

Aruan, Dr A - CIFOR, Bogor

Budiman, Dr AFS - GAPKINDO

Byron, Dr N.- CIFOR, Bogor

Cossalter, Dr C - CIFOR, Bogor

de Foresta, Dr H - ICRAF, Bogor

de Jong, Dr W - CIFOR, Bogor

Poeloengan Dr Z - Vice Director, Indonesian Oil PalmResearch Institute, Medan.

Ruiz Perez, Dr M - CIFOR, Bogor.

Werner, S - Faculty of Environment and Society,Technical University of Berlin.

APPENDIX ADATA ON INDONESIA�S OIL PALM SUB-SECTOR

Oil Palm Area by Producer Category

0

500

1000

1500

2000

2500

1967

1969

1971

1973

1975

1977

1979

1981

1983

1985

1987

1989

1991

1993

1995

1997

Private

Government

Smallholders

Area and Production

Source: Directorate General of Estates (1996)

Source: Directorate General of Estates (1996)

Palm Oil Production by Producer Category

0

1000

2000

3000

4000

5000

6000

1967

1969

1971

1973

1975

1977

1979

1981

1983

1985

1987

1989

1991

1993

1995

1997

Year

Pro

du

ctio

n (

000

ton

s) Private

Government

Smallholders

Are

a (0

00 h

a)

Year


Location of oil palm estates

Oil palm area by province and producer category, 1996

Note: Oil palm areas were planned for Southeast Sulawesi and Maluku in 1996; land clearing operations had commenced. There wereno plans for oil palm estates in NTT, NTB, East Timor, Bali, Central or East Java.Source: Directorate General of Estates (1996: 7)

Costs

Labour wages in Indonesian, Malaysian and Thai oil palm estates, 1996 (US$/day)

Source: ICBS (1997: 146)

Average cost of establishing oil palm estates and amount borrowed1

Province Averageestablishment

cost(million Rp)2

Averageamount

borrowed

Percentageof cost

borrowed

Percentage ofcompaniessurveyed

No. offoreign

companies

Percentage ofcost borrowed

by foreigncompanies

(avg)

PMDN3 PIR TransKKPA4

West Kalimantan 189 914 148 005 78% 18 of 26 0 of 1 2 84%

East Kalimantan 164 486 125 356 76% 11 of 14 3 of 7 nil -

Central Kalimantan 128 915 98 696 77% 8 of 10 2 of 6 nil -

South Sumatra 112 285 86 191 77% 14 of 22 nil 3 88%

Total: 4 provinces 148 900 114 562 76.9% 51 of 72 5 of 14 5 86.4%

Notes:1. For companies investing in the Indonesian oil palm subsector

between August 1995 and mid-1996. At the time when thisdata was collected most of the companies were still seekingfunds, most domestically.

2. Data from before the economic crisis at a time when US$1 wasapproximately equal to Rp 2500.

3. PMDN = private domestic companies, receiving no directgovernment subsidy

4. PIR Trans KKPA = private domestic companies reliant ongovernment subsidy, via the primary cooperative credit scheme.

Source: ICBS (1997)

Province Area (hectares)

Smallholders Government Estate Private Estate Total

North Sumatra 109 316 250 354 215 320 574 990Riau 162 103 66 497 262 358 490 958West Kalimantan 136 068 28 596 46 741 211 405South Sumatra 99 700 22 305 84 677 206 682D.I. Aceh 34 238 25 668 107 606 167 512Jambi 101 766 7 060 38 483 147 309West Sumatra 35 319 3 552 82 283 121 154South Sulawesi 21 725 4 360 29 703 55 788South Kalimantan 0 0 53 997 53 997East Kalimantan 24 656 7 683 9 035 41 374Lampung 2 509 13 233 22 203 37 945Bengkulu 0 1 417 35 505 36 922Central Kalimantan 6 576 0 23 183 29 759Irian Jaya 9 200 5 676 5 640 20 516West Java 7 240 4 757 4.727 16 724Central Sulawesi 6 900 0 6 902 13 802Total 757 316 441 158 1 028 363 2 226 837

Description Indonesia Malaysia ThailandBasic Wage 1.04 4.08 4.00Direct Overhead 0.51 1.89 -Indirect Overhead 0.25 1.89 0.42Housing Costs 0.26 0.34 0.61Total 2.06 8.20 5.03


Prices and returns

World market price for palm oil, 1987-1996*

Year Price (US$/ton)Crude Palm Oil Palm Kernel Oil

1987 353 4371988 463 5251989 524 4791990 280 3341991 333 4141992 290 4031993 406 4481994 524 6331995 648 6811996 522 732

*Prices in Rotterdam for CPO Sumatra and PKO MalaysiaSource: Bank Indonesia Weekly Report as recorded in Directorate General of Estates (1996: 43)

* Palm Kernel Oil was not exported from Indonesia from 1969-1980, nor in 1983.Source: Central Bureau of Statistics and Directorate General of Estates (1996: 5).

Indonesian share of production

Source: Oil World Annual 1996, processed by ICBS (1997)

ProducerCountry

1991 1992 1993 1994 1995 1996 Average Growth%/yr

Malaysia 6 141(53%)

6 371(53%)

7 402(54%)

7 222(51%)

7 810(51%)

8 059(50%)

5.77

Indonesia 2 658(23%)

2 970(25%)

3 421(25%)

3 860(27%)

4 200(28%)

4 746(29%)

11.53

Nigeria 646(6%)

633(5%)

645(5%)

640(5%)

650(4%)

660(4%)

0.44

Ivory Coast 280(2%)

275(2%)

320(2%)

290(2%)

290(2%)

295(2%)

1.38

Colombia 253(2%)

205(2%)

323(2%)

350(2%)

388(3%)

380(2%)

8.56

Thailand 234(2%)

260(2%)

297(2%)

315(2%)

360(2%)

374(2%)

9.68

PNG 180(2%)

202(2%)

222(2%)

224(2%)

223(1%)

228(1%)

6.22

Other 1 082(9%)

1 128(9%)

1 173(9%)

1 233(9%)

1 279(8%)

1 388(9%)

3.58

Total 11 474 12 044 13 803 14 134 15 200 16 130 6.83

Returns per tonne of palm oil exported from Indonesia, 1969-1995

0

100

200

300

400

500

600

700

800

1969

1971

1973

1975

1977

1979

1981

1983

1985

1987

1989

1991

1993

1995

Year

US

$ p

er t

on

ne

CPO

PKO*

Development of world crude palm oil production, 1991-1996 (000 tons)


Year Total population(million)

Per capita consumption(kgs/yr)

% growth per year Total (tons) % growth peryear

1987 172 4.97 - 855 784 -

1988 175 5.28 6.24 923 736 7.94

1989 177 5.50 4.17 977 460 5.82

1990 179 5.56 1.09 997 464 2.05

1991 182 6.82 22.66 1 241 240 24.44

1992 185 9.30 36.36 1 723 290 38.84

1993 189 9.47 1.83 1 790 770 3.92

1994 192 10.33 9.08 1 985 426 10.87

1995 195 10.39 0.58 2 029 167 2.20

1996 198 11.23 8.08 2 226 909 9.74

Average 10.01 11.76

Consumption, domestic and global

Growth of the consumption of palm-oil based cooking oil in Indonesia, 1987-1996

Source: Oil World Annual 1996 as represented in ICBS (1997: 186)

Development of CPO consumption by consuming industry in Indonesia, 1991-1996

Industry type CPO consumption per year (tons) Change1

1991 1992 1993 1994 1995 1996

Cooking oil 1 302 308 1 498 554 1 508 462 1 788 369 2 014 062 2 249 706 11.72Bath & laundry soaps 43 840 56 960 61 520 65 920 79 104 87 014 15.02Margarine 178 077 195 440 210 660 240 046 303 640 333 083 13.54Oleochemical 155 349 174 531 196 066 215 673 210 290 262 862 11.43

Total 1 679 574 1 925 485 1 976 708 2 310 008 2 607 096 2 932 665

Note: 1 Change = Average annual change %/yr

Source: ICBS (1997: 225)

Growth in the world consumption of five major vegetable oils, 1990-1996

Note: 1 Growth % = Average annual growth %/yrSource: ICBS (1997: 229)

Oil Description Unit 1990 1991 1992 1993 1994 1995 1996 Growth1

%

Soybean oil Volume 000 ton 15,840 15,716 16,727 17,844 18,713 19,610 19,779

Share % 19.75 19.10 19.85 20.65 20.98 21.23 20.74

Annualincrease

% - 0.78 6.43 6.68 4.87 4.79 0.86 3.81

Palm oil Volume 000 ton 11,301 11,602 12,243 13,259 14,530 14,712 15,492

Share % 14.09 14.08 14.54 15.35 16.30 15.93 16.24

Annualincrease

% - 2.67 5.53 8.29 9.59 1.24 5.30 5.44

Sunflower oil Volume 000 ton 7,955 8,383 8,223 7,746 7,696 8,495 8,953

Share % 9.92 10.18 9.76 8.97 8.63 9.20 9.39

Annualincrease

% - 5.39 1.91 5.81 0.64 10.38 5.39

Rapeseed oil Volume 000 ton 8,730 8,847 9,459 9,274 9,623 10,368 11,332

Share % 10.89 10.74 11.23 10.74 10.79 11.22 11.88

Annualincrease

% - 1.34 6.92 1.95 3.76 7.74 9.29 4.52

Coconut oil Volume 000 ton 3,054 3,222 2,895 2,935 3,072 3,189 3,132

Share % 3.81 3.91 3.43 3.40 3.44 3.45 3.28

Annualincrease

% - 5.52 10.14 1.37 4.68 3.79 1.79 0.57


Projected world palm oil production and consumption, 1996-2005

Year Production

(000 tons)

Consumption

(000 tons)

Surplus/Deficit

1996 15 915 15 492 423

1997 17 003 16 335 668

1998 18 214 17 224 990

1999 19 511 18 161 1 350

2000 20 900 19 149 1 751

2001 22 388 20 297 2 091

2002 23 982 21 512 2 470

2003 25 689 22 806 2 883

2004 27 519 24 175 3 344

2005 29 478 25 625 3 853

Source: Oil World Annual 1996, as reproduced in ICBS (1997: 319)

APPENDIX BDATA ON APPLICATIONS

FOR FOREST CONVERSION, 1995

Applications for the release of forest land for agricultural use, as of June 1995

Note: These applications seek the release of both conversion and non-conversion forest land.Source: Direktorat Tata Guna Hutan, Direktorat Jenderal Inventarisasi dan Tata Guna Hutan, as recorded by Sumahadi(1995)

Applications for the release of forest land to agricultural use, applications agreed in principle andland already released, per province, as of June 1995

Note: These applications seek the release of both conversion and non-conversion forest land.

Source: Direktorat Tata Guna Hutan, Direktorat Jenderal Inventarisasi dan Tata Guna Hutan, as recorded by Sumahadi

(1995).

Location Number ofapplications

Percentage of totalapplications

Area

(ha)

Percentage of totalarea

Sumatra 723 62.98 9 396 000 60.03

Kalimantan 288 25.09 4 760 000 30.42

Sulawesi 75 6.53 665 000 4.25

Maluku 33 2.87 236 000 1.51

Irian Jaya 23 2.00 591 000 3.78

West NusaTenggara

6 0.52 2 000 0.01

Total 1 148 100 15 650 000 100

Province Outstanding applications Applications agreed inprinciple

Forest land alreadyreleased

No. Area (ha) No. Area (ha) No. Area (ha)

Aceh 115 1 086 518 57 315 851 31 179 161North Sumatra 113 1 072 460 31 172 829 14 65 033Riau 240 4 246 076 126 1 650 187 80 1 115 236West Sumatra 54 336 693 31 162 162 15 89 264Jambi 62 685 212 35 345 142 18 227 864Bengkulu 30 134 495 12 47 500 8 33 829South Sumatra 78 1 469 008 16 127 829 5 31 495Lampung 31 365 235 9 90 572 4 11 830West Kalimantan 62 1 265 125 22 257 059 6 61 629East Kalimantan 104 1 820 271 37 295 395 22 196 125Central Kalimantan 75 1 149 973 27 257 250 8 102 863South Kalimantan 47 524 758 23 257 250 16 180 388North Sulawesi 15 94 272 2 10 000 1 2 000Central Sulawesi 31 305 018 9 82 790 7 56 671Southeast Sulawesi 5 74 800 3 19 750 1 2 750South Sulawesi 24 191 289 18 107 915 7 44 167NTB 6 1 777 3 643 2 753Maluku 33 236 314 11 25 780 7 12 257Irian Jaya 23 590 992 12 126 389 6 89 064

Total 1 148 15 650 286 484 4 353 293 258 2 502 379

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