Palm Oil to Be Included in Carbon Trading Scheme

The Government is currently formulating regulations to support carbon trading in the agriculture and plantation sectors. At present, several commodities are being assessed for inclusion in the carbon trading mechanism.

“We are currently developing which commodities we can include in carbon trading,” said Prayudi Syamsuri, Expert Staff for Connectivity Management at the Coordinating Ministry for Food Affairs.

Prayudi stated that one of the plantation commodities being considered for inclusion in the carbon trading scheme is palm oil, as it is regarded as having a well-established recording system. The Indonesian Sustainable Palm Oil (“ISPO”) certification may serve as a basis for documentation to demonstrate that farmers have implemented good and sustainable cultivation practices, which is an important requirement in carbon trading.

“One of the commodities being proposed is palm oil because its recording system is clearly established through ISPO,” he explained.

The Profit-Sharing Fund (Dana Bagi Hasil- “DBH”) for Palm Oil may be utilized to support supervision and assistance costs for farmers, enabling them to enter and participate in the carbon trading market.