The World’s Leader in the Palm Oil Industry : Indonesia

Indonesia, being the world leader in the production of crude palm oil, has been successful in serving the domestic and world market with palm products and palm derivatives. The industry contributes US$17.6 billion through exports in 2012. At present, the demand for crude palm oil has soared high due to the increasing awareness of the varied uses of palm oil. The challenge to countries cultivating oil palm is how to cope with the local and global demand .The focus now is to increase plantation areas to produce a higher volume of crude oil to serve the needs of the world market. Today, the total land area planted to oil palm in Indonesia has reached 9.7 million hectares. This study used data mining and Delphi technique. Data were sourced from public domain websites and several databases. This study determined the gap between production and utilization and to provide information to existing industry players ,policy makers, future investors, and would-be entrants to the industry on the latest trends noting the fast development of the industry not only in Indonesia but also in other Southeast Asian countries. Although Indonesia has been successful in providing the local and international market with palm oil products and palm derivatives, it has to benchmark with other palm producing countries to avoid industry stagnation and to intensify diversification particularly in the development of new edible products to take advantage of the health benefits derived from the use of palm oil.


Recoletos Multidisciplinar y Research Journal
the demand went high due to the use for it as a lubricant for steam engines and other machineries for soap making.It was not until the 20th century that oil palm was planted commercially in Southeast Asia. Oil palm produces two different types of oils, namely palm oil and palm kernel oil.
Palm oil is used in food products such as cooking oil, shortenings, and margarine while palm kernel oil is mostly used as raw material for nonfood products that include soaps, detergents, toiletries, cosmetics and candles. More recently, palm oil has been used as feedstock for biofuel.Palm oil chemical composition offers greater advantages compared to other sources of vegetable oils as it has a longer shelf life and it does not easily become rancid..It is naturally semi -solid and does not need to undergo hydrogenation (MPOC 2010). Other oils have to undergo hydrogenation to be made At present, the demand has soared high due to the increasing awareness of the varied uses of palm oil. The challenge to countries cultivating oil palm is how to cope with the local and global demand. The focus now is to increase plantation areas to produce a higher volume of crude oil to serve the needs of the world market. Today, the total land area planted to oil palm in Indonesia has reached 9.7 million hectares.
by Kalimantan with 17%, and Sulawesi with 2%. Agriculture Minister Suswono, said after the opening of the 5th Indonesian Palm Oil Conference in Nusa Dua, Bali, said that of the total 9.7 million Figure 1 Regional Palm Oil Production in Indonesia Sequiño and Avenido hectares, 7.9 million hectares are already planted to palm oil, while the remaining 1.8 million hectares still stand empty.(JakartaPost2009) "Based on the land characteristics and the climate, Indonesia has a total of 18 million hectares of land, including the existing 9.7 million hectares, that potentially could be used for oil palm plantations without disturbing the forest preservation efforts, " Suswono said. Morrison, Renfro, and Boucher (1984) simplified the environmental scanning theory of Aguilar (1967) from four scanning types to either passive or active scanning. They explained that passive scanning is what most people do when they read journals and newspapers. They further noted that people tend to read the same kinds of materials like local newspaper or an industry newspaper such as Industry Monitor. However, the organizational consequences of passive scanning are that we do not systematically use the information as strategic information for planning and we miss many ideas that signal changes in the environment.
On the other hand, active scanning focuses on information resources that span the task and industry environments as well as the macro environment. In active scanning, it is important to include information resources that represent different views of each sector.
In scanning the palm oil industry, the researcher found articles about the benefits of the industry's presence. The industry has encouraged the government of different countries to formulate policies to support the different stakeholders.Thus, this environmental scanning study determined the gap between production and utilization to provide information to existing industry players, policy makers, future investors and would-be entrants to the industry on the latest trends noting the fast development of the industry not only in Indonesia but also in other Southeast Asian countries.

Research Design and Methodology
This study used data mining and Delphi

Results and Discussion
The Indonesian Government intends to intensify efforts to improve productivity particularly for small holders since they comprise 39% of the total ownership of plantations while 50% is privately owned and 11% state owned (Ministry of Agriculture, Indonesia.)As shown in Figure    Indonesia has 44% market share while Malaysia has 39% market All other palm oil producing countries get 17% of the market share.

Sequiño and Avenido
Indonesian government and its industry players. They need to face squarely the false and damaging advocacy of the so-called "environmentalists", which hampers the growth of the palm oil industry.
The environmentalists' allegation on virgin forest destruction and oil palm processing pollutants in Indonesia may be addressed by using zero waste technology to utilize OP processing waste to produce organic fertilizers, biofuel, and electricity to solve the electric energy problem of the locality.

Opportunities
The world population was projected to grow from 7 billion in 2011 to 9 billion in 2013, an increase of 29 percent. Food production must meet this rate of increase (Basiron, 2012).
There is a high and an increasing demand for palm oil due to the discovery of many uses: as a source of food, and source of renewable energy. Potentials of palm biomass and palm wood furniture remain largely untapped.
There is a high and an increasing demand due to increasing dependence on palm oil as vegetable oil replacing other vegetable oils; the high and increasing demand may create worldwide shortage of palm oil.
In 2020 the world will be short of 25.7 million tons of palm oil if the area of oil palm is not expanded from the level of 2012.

Conclusion
The economic benefit of the palm oil industry in Indonesia has been so great that it has alleviated the poverty level among the vast majority. It has generated significant social developments as well with palm oil being the third major commodity