Responsible Sourcing from Smallholders Seminar and Focus Group Discussion

Indonesia is one of the world’s largest producers of palm oil. Around 42 percent of the country’s palm oil production comes from smallholders, notably independent smallholders: growers who cultivate palm oil without direct assistance from government or private companies.

These farmers sell their crop to local mills either directly or through traders. Independent smallholders are essential in ensuring optimal mill throughput, yet their growing numbers pose a challenge to companies committed to sustainable sourcing, as the production practices of independent farmers are difficult to monitor and control.

To respond this challenge, the Smallholder Acceleration and REDD+ Programme (SHARP) developed the Responsible Sourcing from Smallholders (RSS) approach, which is implemented under SNV's Sustainable Palm Oil Programme in Indonesia. The RSS approach seeks to define minimum requirements for responsible production that smallholder producers must meet, while in parallel ensuring that incentives and support is provided for smallholders to achieve this. Through the RSS system, SHARP assists companies in providing assistance to smallholders to move towards responsible production methods. By including independent smallholders in the sustainable production and supply arrangements the mills do not have to segregate supplies and economies of scale in production and supply can be achieved.

SNV and SHARP, together with Forum Minyak Kelapa Sawit Berkelanjutan / Forum of Indonesia Sustainable Palm Oil (FORMISBI), held a seminar and focus group discussion about the RSS approach. This activity aimed to help independent oil palm farmers and other related stakeholder to gain a deeper understanding on the RSS approach and learn how they can become involved. The workshop also aimed to encourage discussion of how to provide sufficient support to independent smallholders to improve their practices.

The workshop was held at Grand Kemang Hotel, Jakarta on May 5th 2015. Speakers included the head of FORMISBI managing board Bambang Dwilaksono, Dr. Haryadi from Bogor Agriculture Institute who spoke about the role of independent oil palm smallholder role in global palm oil market, and Dani Rahadian P. Hidayat from SNV who spoke about the RSS approach.

There were about 45 participants, representing actors along the supply chain as well as concerned and interested parties outside the palm oil value chain, such as environmental and social NGOs, certification bodies and consultants. The seminar, consisting of presentations and a question and answer session, took place in the morning. In the afternoon, the participants were divided into 3 groups for the focus group discussions. The first group was mainly composed of social NGOs, environmental NGOs and mills, and discussed the environmental and social aspects of the minimum requirements for smallholders. The  second group discussed technical aspects of the support provided by mills to smallholders under the RSS approach. The third group discussed market responses to the RSS approach. The participants in this group were mainly off takers and millers.