Regulating Standalone Oil Palm Mills in Indonesia: A Review

This journal discusses the controversy surrounding palm oil mills without their own plantations in the governance of Indonesia's palm oil industry. Through a qualitative literature review of recent studies, regulations, certification issues, and FFB market dynamics, this article assesses that such mills are not automatically detrimental or beneficial. On one hand, their presence can expand market access for independent farmers, reduce fruit queues, increase price competition, and encourage local investment. On the other hand, without strong oversight, mills without plantations risk weakening plasma partnerships, worsening traceability, and creating opportunities for poorly documented FFB procurement. This study recommends a conditional governance model through regional feasibility tests, farmer partnerships, price transparency, ramp registration, digital traceability, and gradual integration with ISPO.