PKS (Palm Kernel Shell) Export Business and New Varieties of Superior Palm Oil Seeds

PKS loading for export

The demand for biomass fuels as renewable energy, including PKS (palm kernel shells), is growing in line with the global decarbonization trend. Likewise, the use of biofuels such as biodiesel is also increasing. Biomass fuels like PKS and biofuels like biodiesel are both carbon-neutral bioenergy products. Both can be produced from palm oil trees. Biofuels like biodiesel are primarily used in the transportation sector, while biomass fuels like PKS are used for power generation or industrial boiler fuel. Palm oil produces its primary product namely crude palm oil and crude palm kernel oil (CPO and CPKO), while the PKS are byproducts or waste, such as EFB (empty fruit bunches) and mesocarp fiber.

Over time, the demand for palm oil has also increased, commensurate with population growth, and its use in the energy sector (biofuel) is even greater than in the food sector. To stabilize prices and avoid sharp fluctuations in palm oil prices, the Indonesian government launched the B-50 program, which uses 50% biodiesel from palm oil and 50% diesel from petroleum. With the B-50 program, palm oil demand has increased by approximately 20% over current average production.

This necessitates increasing palm oil productivity. One such effort is the use of superior seeds. By maximizing CPO production from mesocarp fiber, these superior seeds have thick fiber, thin shells (even shellless), and small kernels. The Psifera variety, with its various unique names by seed producers, is an option for this purpose. These superior seeds are even certified to assure consumers of their quality.

The initially thick PKS of the dura variety, which are favored and most sought after by PKS exporters for use in power plants, will gradually decline. However, considering the slow pace of replanting programs and minimal extensification efforts, the transition from dura to psifera PKS will be lengthy. PKS exporters can still safely export thick dura PKS. The less thin tenera PKS, as a transition to psifera, will likely become more common.

If very thin psifera PKS become commonplace, their calorific value will be low and they will be less desirable for energy applications. If this occurs, special treatment is required to make the psifera PKS more technically and economically viable for energy use. This can be achieved through compaction/densification or processing through torrefaction or pyrolysis to produce higher fixed carbon and calorific value. Furthermore, they can be compacted/densified into pellets or briquettes. 

The Role of Biochar in Increasing Palm Oil Productivity, Among the Use of Superior Seeds and Replanting

Palm oil productivity continues to be pushed to its most optimal point. This is because it is to meet the increasing needs, especially the mandatory B-50 biodiesel program. Of course, efforts to optimize productivity are not easy and instant. Although the key points for its realization have also been mapped, namely by replanting old palm oils, using superior seeds and intensification, the practice also requires the right method or approach and takes time. Replanting old palm oils is still very slow and has many obstacles, while the use of superior seeds has received more attention and continues to be encouraged. The analogy of using superior seeds is like comparing local cattle and superior breeds. So no matter how well the Javanese cow is cared for, its weight will not match that of the Limousin cow. Likewise with palm oil seeds.

Land intensification efforts through optimizing inputs, technology and modern cultivation methods also still need to be developed. Meanwhile, extensification or land expansion should be avoided or slowed down as much as possible, for more details, read here. Biochar can have an important role in this area of ​​intensification. Apart from the application of biochar it will improve soil health, which is an important prerequisite for plants to be able to produce optimally, it is also very environmentally friendly because the raw material for biochar is from renewable sources, namely biomass and increases fertilization efficiency (NUE = Nutrient Use Efficiency). And even the application of biochar is also a climate solution, namely as carbon sequestration. Optimizing productivity can be done by applying biochar plus using superior seeds using modern and environmentally friendly agricultural methods. So basically optimization is a comprehensive and measurable effort.

Indonesia contributes 25% to the world's vegetable oil supply, making it a key actor in the stability of the world's vegetable oil supply. With this position, any changes in production, export policies and Indonesia's domestic dynamics will directly impact prices and international market balance. Indonesia is currently the largest or number one producer of palm oil in the world, but it is not the best or most productive because its productivity is not yet optimal. Compared to neighboring countries, namely Malaysia, it is still inferior and slightly superior to Thailand, even though geographical factors, namely the climate in Indonesia, are much more supportive. Currently, Indonesia's CPO productivity is around 3.3 tons/hectare, while Malaysia's is around 3.8 tons/hectare, while Thailand's is around 3 tons/hectare.

Yield gap, namely the difference or gap between actual production and maximum production potential, is sometimes quite large. Several main factors that trigger yield gaps include non-optimal environmental factors such as drought conditions, to errors in cultivation practices such as errors in land clearing and planting, as well as inaccuracies in diagnosis and fertilizer recommendations. This yield gap must be minimized so that palm oil productivity can be maximized.

Sometimes the role of biochar cannot be found or seen directly in various efforts to increase palm oil productivity, but the application of biochar is very much in line with this goal. For example, the success of an palm oil replanting program depends, among other things, on the quality of seeds, fertilization, plant population and soil health. Soil health and fertilization factors can be closely related to biochar. And related to biofungicides to treat ganoderma fungus disorders, biochar can be used as a carrier formulated with other elements such as humus, amino acids, humates, hormones and so on. And because the only effective way to control the ganoderma fungus is to introduce its natural enemies in the form of biofungicides based on Trichoderma spp and arbuscular mycorrhizal fungi into the soil. However, there are still many parties who do not have adequate knowledge regarding the application of biochar.

Apart from boosting production, implementing best management practices is also important to meet sustainability standards amidst increasing pressure from environmental issues. And the application of biochar is very much in line with that point. In fact, regarding low carbon palm oil technology in the application of biochar, it is very relevant to the CECC (Controlled Emission Composting Chamber) and for more details on the application of biochar for composting, read here. Meanwhile, the trend of fertilization in palm oil plantations with the application of slow release fertilizer is also very relevant to biochar, for more details, read here. 

Indonesia's 2026 Palm Oil Replanting Target and Solutions for Utilizing Palm Oil Trunk Waste

Indonesia's stagnant national palm oil productivity requires an immediate solution. If this situation is not addressed promptly, Indonesian palm oil productivity will decline in the future. This is undesirable given the increasing demand for palm oil as a vegetable oil, including its use in biofuel, namely biodiesel. The launch of the B50 biodiesel program demands increased palm oil productivity. However, the question remains: why palm oil? Aren't there other crops that can produce oil with a comparable yield for biodiesel production? Nyamplung is a strong candidate for this; read more details here.

In palm oil, productivity can be increased through the use of superior seeds, replanting, and land intensification. In terms of land area, replanting palm oil plantations, with an ideal target of 5% per year, is very significant. With Indonesia's current 16.8 million hectares of oil palm plantations, that translates to 0.84 million hectares per year. Besides the high costs, the resulting biomass waste, or palm oil trunks, is also substantial. This clearly holds potential for an environmentally friendly bioeconomy-based industry, or circular economy.

With an area of Indonesia's palm oil plantations of around 16.8 million hectares, 9 million hectares are managed by private companies, 550 thousand hectares are owned by state-owned companies (PTPN), 6.1 million hectares belong to people's plantations or small farmers and the rest have not been verified. And based on data from the Central Statistics Agency (2024), recorded 10 provinces in Indonesia with the largest oil palm plantations in sequence, namely Riau province with 3.49 million ha, Central Kalimantan province with 2.03 million ha, North Sumatra province with 2.01 million ha, West Kalimantan province with 1.82 million ha, South Sumatra province with 1.40 million ha, East Kalimantan province with 1.32 million ha, Jambi province with 1.19 million ha, South Kalimantan province with 497.2 thousand ha, Aceh province with 487.5 thousand ha, and West Sumatra province with 379.6 thousand ha. And a total of 26 provinces in Indonesia as centers of palm oil plantations.

The palm oil industry, as one of the national strategic industries, receives significant government support, including the People's Palm Oil Replanting (PSR), which remains a national strategic program, although its realization has not yet reached the target. South Sumatra, as one of the national palm oil plantation centers, also recorded the highest PSR realization. PSR realization in 2025 is approximately 40,000 hectares, or 33% (one-third) of the target of 120,000 ha. This represents a slight increase compared to 2024, which was only 31% of that year's target. Specifically, South Sumatra has replanted approximately 75,000 ha of smallholder palm oil plantations from 2017 to 2025.

The government is targeting a national PSR of 50,000 ha for 2026, a much more realistic figure than in previous years, with South Sumatra province targeting 5,750 ha. However, given Indonesia's oil palm plantation area, the 2024 and 2025 targets of 120,000 ha are very low, especially for 2026, which is only 50,000 ha. Under these conditions, efforts that can be accelerated to increase national palm oil productivity are through the use of superior seeds and land intensification.

Furthermore, ganoderma can lead to the death of palm oil trees. Ganoderma, caused by the fungus Ganoderma boninense, attacks the palm oil's root system, disrupting nutrient and water transport. The process is very slow and is only detected when the infection is severe, resulting in yellowing leaves, drooping crowns, and even plant death. Waste from ganoderma-infected trunks must be removed or destroyed from the plantation to prevent further spread. Like waste from palm oil trunks from replanting, this waste must also be properly managed.

The issue of biomass waste from palm oil trees, which covers thousands of hectares, also presents a challenge. With such a large volume of old palm oil trees, utilizing them to create value-added products is crucial. With such a large volume, biomass processing plants or industries can be established and operate optimally, without worrying about raw material shortages. Products such as pellets, briquettes, and biochar are made from this waste biomass from old palm oil trunks. Old, dead palm oil trunks, often left unattended on land, should be utilized to create these useful, value-added products.

As shown in the diagram above, the potential for utilizing biomass waste, particularly oil palm trunks, is enormous. In the future, industrializing bioeconomics into various products is highly feasible. Palm oil trunk waste should not only pollute the environment and increase costs for palm oil farmers, but instead, it should become a profitable industrial raw material.

Blue Economy & Bioeconomy – Seaweed, Coconut and Nyamplung

With the second longest coastline in the world, located on the equator so it has a tropical climate and the largest coconut producer in the world, maintaining and continuing to develop coconuts is very important and strategic for Indonesia, especially since Indonesia has long been famous as the land of waving coconut trees. The productive life of coconut trees is also very long, namely 60 years, so they can be passed down across generations. The nyamplung tree, which is easy to grow and is often found in coastal areas, should also be developed, as well as the potential for seaweed. With the development of the times to carry out decarbonization in various sectors of life, especially the use of renewable energy, coconut, nyamplung and seaweed can be an effective solution.

Coconut oil, like palm kernel oil (PKO), has a high lauric acid content, so it is very suitable for the production of Sustainable Aviation Fuel (SAF). Currently, Indonesia is planning to increase SAF production from palm oil, namely palm kernel oil, to 3% this year (2026). This policy was accelerated to support the aviation sector's decarbonization targets. Palm kernel oil production is around 5 million tons/year with the main uses currently being very diverse, including the food industry (margarine, chocolate, cakes), cosmetics (soap, shampoo, lipstick), oleochemicals (fatty acids, glycerol), to renewable energy (SAF) - still in the early stages, as well as non-food products such as lubricants. while the potential for coconut oil is 2.9 million tons with the main uses being cooking (cooking oil), processed food industry (biscuits, margarine, ice cream), cosmetics (soap, shampoo, moisturizer), health (consumed directly as Virgin Coconut Oil (VCO)) and pharmaceuticals (ointment base), skin/hair care and oleochemicals. Why coconut oil and palm kernel oil are very suitable for SAF production, read more details here.

In addition to the potential raw material for SAF from coconut, the international civil aviation organization (ICAO) has included non-standard coconut in the ICAO positive list - ICAO document - CORSIA Default Life Cycle Emissions Values for CORSIA Eligible Fuels, 6th Edition on October 28 20024. Non-standard coconut includes very small old coconuts, already sprouted, starting to rot or become moldy and those that are broken. Based on data from a number of research studies, the number of non-standard coconuts in Indonesia is estimated to reach 30% of Indonesia's coconut production.

Regarding coconuts, the government should limit or prohibit exports of round coconuts. This will not only hinder the domestic coconut processing industry but also more specifically the development of SAF. Apart from that, efforts to replant coconut plantations must also be carried out. The area of ​​coconut plantations that must be replanted currently reaches hundreds of thousands of hectares, such as in Riau alone with a coconut plantation area of ​​426,579 hectares (11.4% of the plantation area in the province, read more details here). 72 thousand hectares of coconuts need to be replanted, while the replanting speed is very low so coconut productivity continues to decline. Meanwhile, nyamplung trees and seaweed require socialization and real action so that they can meet production targets and expectations.

Meanwhile, nyamplung oil can be used for biodiesel / FAME production. From the government's plan to increase the biodiesel mixture from B-40 to B-50, this means requiring almost 60 million tons/year of vegetable oil, especially palm oil. Meanwhile, currently crude palm oil or CPO production is around 50 million tons/year and increasing 20% ​​or to 60 million tons/year is certainly not easy. Moreover, currently the expansion of palm oil plantations (extensification) is in the sharp public spotlight with widespread public attention. A number of natural disasters, especially the Sumatran floods, which have claimed the lives of thousands of people, with the extensification of palm oil plantations as the suspect, have made it increasingly difficult to increase palm oil production through expanding this land. And indeed land expansion (extensification) must always be in the corridor of sustainability, so that palm oil can be a blessing and not a disaster.

Nyamplung trees with productivity almost the same as palm oil trees are very interesting to develop for biodiesel production or more practically adding 10 million tons / year to reach the B-50 proportion. Along Indonesia's very long coastline, there are locations for coconut and nyamplung plantations. Apart from that, seaweed from its waste is also a potential raw material for renewable energy, both ethanol, biodiesel and SAF.

Meanwhile, from the seaweed sector, apart from the production of agar, carrageenan and alginate which are widely used for food products, biofuel can be produced from seaweed waste. Seaweed industry waste can reach 65-75% of the fresh raw materials processed. This very large amount is often wasted without further use which can increase added value. Because solid seaweed waste contains a high percentage of cellulose and only a small amount of lignin, this waste has the potential to be processed into bioethanol and sustainable aviation fuel (SAF). 

The process route, namely ATJ or alcohol to jet fuel, can be used to produce sustainable aviation fuel (SAF). Meanwhile, seaweed waste is usually disposed of in landfills, which can cause unpleasant odor problems. Specifications for industrial waste from the E. cottonii species are 3.66% water content; ash 36.84%; protein 1.78%; carbohydrates 11.36%; 0% cellulose; hemicellulose 12.86%; lignin 0%. Meanwhile, industrial waste specifications from the species Gracilaria sp. and Gelidium sp.: cellulose 26.92%; hemicellulose 16.11%; lignin 15.38%; ash 16.72%; water content 12.94%; NaCl 3.77%. 

After their productive life is over or ends, the coconut trees and nyamplung trees are cut down. Coconut tree trunks and nyamplung trees are very suitable for building wood used for housing. This will add economic value and is a necessity that will continue to be needed. In fact, efforts to improve the quality of wood can also be done by engineering the wood material, such as with CLT (cross laminated timber) and so on.

And like palm oil, both coconut and nyamplung also produce shells. Just as palm kernel shells can be used for fuel, so coconut shells and nyamplung shells as well. Even palm kernel shells or known as PKS (palm kernel shell) are the main competitors of wood pellets in the global biomass fuel market. However, because the quality of coconut shells is better or more suitable for the production of charcoal briquettes and activated carbon, coconut shells are generally carbonized or made into charcoal. Charcoal is an intermediate product or raw material for charcoal briquettes and activated carbon. Read more details about the production of activated carbon from coconut shells here. Meanwhile, because nyamplung shells are not widely produced, their use is still limited, but if the quantities are large, such as the production of palm kernel shells, then it could be like palm kernel shells, or perhaps also like the use of coconut shells.

Apart from that, both the production and extraction of coconut oil and nyamplung oil will produce cake. Coconut cake and palm oil cake can be used as animal feed, but nyamplung cake requires additional processing so that it is non-toxic and safe for animal feed. The development of a blue economy on the Indonesian sea coast should be an important concern as an environmentally friendly economic solution that suits the conditions and potential of Indonesian society and is in line with the global community's concerns about decarbonization as mitigation for climate change and global warming. Apart from also supporting food and feed security. 

Slowing Palm Oil Land Expansion: Replanting or Biochar ?

The reckless expansion of palm oi plantations is definitely offside sustainability. Instead of palm oil being a blessing due to their highest productivity among other vegetable oil sources (soybeans, sunflowers, rapeseed, coconuts, etc.), growing only in tropical regions and contributing 40% of the global vegetable oil supply, they have instead become a natural disaster. The cost of this disaster is no small matter, costing thousands of lives, in addition to other material losses. This issue was particularly highlighted during the recent floods in Sumatra. Are the profits from palm oil worth the loss of life?

Clearing tens or even hundreds of thousands of hectares of oil palm plantations produces valuable timber. It's even possible to generate substantial profits from land clearing alone, even though palm oil plantations and production haven't even begun. This is what drives entrepreneurs to flock to this plantation sector, driven by the sole goal of maximizing profits without considering their own needs, resulting in widespread disasters. Furthermore, the implementation of mandatory B-40 or even B-50 biodiesel, currently being discussed, will undoubtedly create a new market for palm oil/CPO, much easier and more flexible than exporting to Europe, which is subject to the European Union Deforestation Regulation (EUDR), or to the US, which faces high tariffs.

Moreover, it has already been established that palm oil/CPO consumption for biodiesel has exceeded food demand. The mandatory implementation of the B-50 program also requires a 20% increase in CPO production capacity, or 60 million tons per year. The most profitable and fastest way to do this is through extensive deforestation, as the timber from cleared forests can be sold directly.

When the goal is to increase palm oil production gradually, safely, in a planned, and sustainable manner, adequate consideration is required, not blindly and recklessly clearing forest areas (deforestation) under the guise of land conversion. Besides the use of superior seeds, there are at least two ways to increase palm oil productivity: replanting and biochar application (part of land intensification).

According to Joko Supriyono, former chairman of GAPKI (Indonesian Palm Oil Producers Association) for the 2015-2018 and 2018-2023 periods, in his book "Is Indonesian Palm Oil Still Successful?", it is stated that if replanting of palm oil in Indonesia successfully reaches 300 thousand hectares per year, it is estimated that CPO and CPKO production in 2045 will reach 80 million tons. While currently CPO and CPKO production is around 55 million tons. And with the use of biochar, palm oil productivity will increase by an average of 30% in 5-10 years, meaning that by 2035 CPO and CPKO production will reach 71.5 million tons. Moreover, if the two methods are combined, the results should be even better.

Indonesia's current CPO production reaches approximately 50 million tons/year, covering a land area of ​​16.8 million hectares with an average CPO production of 3.55 tons/ha per hectare, or 3.55 million tons per million hectares. If biochar is used and productivity increases by 30%, this means an increase of 15 million tons of CPO (a total of 65 million tons of CPO/year) and this saves approximately 4.2 million hectares of land, or the use of biochar will slow down forest clearing for palm oil plantations. The application of biochar with compost will improve the quality of the compost to become premium compost. For more details, read here. This allows the palm oil industry to operate by utilizing all its biomass waste.

The replanting movement of palm oil plantations must be encouraged to continuously increase palm oil production. The problem of biomass waste from palm oil trees, which cover thousands of hectares, also poses a challenge. With such a large volume of old palm oil trees, utilizing them for value-added products is crucial. With an average hectare of palm oil plantations consisting of 125 trees, each tree having an average dry weight of 0.4 tons, this yields 50 tons of dry weight of biomass per hectare. For an area of ​​10,000 hectares, this yields 0.5 million tons of dry weight, and for an area of ​​100,000 hectares, this translates to 5 million tons of dry weight. An optimistic estimate suggests that Indonesia could achieve 5% replanting (very optimistic) or 820,000 hectares, which would yield 41 million tons of dry weight of biomass per year. Similarly, Malaysia, with 5% replanting or 285,000 hectares, would produce 14.25 million tons of dry weight per year.

Business readiness factors, both technologically and in terms of the market or user base, need to be carefully assessed. With such a large volume, biomass processing plants or industries can be established and operate optimally without worrying about raw material shortages. Products such as pellets, briquettes, biochar, and other bioproducts, such as other biocarbons, biomaterials, biofuels, and biochemicals, are also possible from this old palm oil trunk biomass waste. Old, dead oil palm trunks, often left unattended on land, should be utilized to produce these useful, value-added products. For more details on utilizing trunk waste for fuel pellet production (OPT Pellets), please read here. 

OPT Pellets for Biomass Power Plants and BECCS in Japan and Europe

As a tropical region known for biomass heaven, there are numerous sources that can be utilized for biomass pellet production, particularly OPT pellets or oil palm trunk pellets. This potential is certainly in line with global decarbonization efforts to save the earth from climate change and global warming. Indonesia is currently the world's largest palm oil producer, with approximately 17 million hectares of palm oil plantations. Of this area, 9 million hectares are managed by private companies, 550,000 hectares are owned by state-owned companies (PTPN), 6.1 million hectares are owned by smallholders, and the remainder remains unverified. Crude palm oil or CPO productivity has stagnated over the past five years due to the slow pace of replanting, which is around 45 million tons per year. Therefore, replanting, especially for smallholders, must be encouraged.

Most palm oil companies affiliated with GAPKI have conducted replanting periodically or once a year with an area of ​​4-5%. The palm oil companies that are members of GAPKI are 731, while according to BPS 2023 the number of palm oil companies in Indonesia reached 2,446 companies, spread across 26 provinces. Meanwhile, in smallholder palm oil plantations, replanting is very small, namely in 2024 alone with a target of 180,000 hectares (around 3% of smallholder palm oil plantations) but the realization is less than 40,000 hectares (0.7% of smallholder palm oil plantations) and even because it is so far from the target set in 2025 the government's target for replanting smallholder palm oil plantations was reduced to only 120,000 hectares (around 2% of smallholder palm oil plantations).

With an average of 125 trees per hectare of palm oil plantation, each tree yielding an average dry weight of 0.4 tons, this yields 50 tons of dry biomass per hectare. For an area of ​​10,000 hectares, this translates to 0.5 million tons of dry biomass, and for an area of ​​100,000 hectares, this translates to 5 million tons of dry biomass. Optimistically, Indonesia could achieve 5% replanting, or 820,000 hectares, which would yield 41 million tons of dry biomass per year. Malaysia, with 5% replanting, or 285,000 hectares, would produce 14.25 million tons of dry biomass per year.

For a more practical calculation, let's consider the average palm oil company group in Indonesia with five palm oil mills and 50,000 hectares of palm oil plantations. With annual replanting of 5% of the total plantations, 2,500 hectares are replanted annually. This replanting will produce 125,000 tons of dried oil palm trunks. This volume will then be used to produce oil palm trunk pellets, or OPT pellets, assuming 3% loss during the production process. This yields 121,250 tons of OPT pellets per year.

Using a Handymax vessel with a capacity of 25,000 tons per shipment, five shipments are required, or using a Panamax vessel with a capacity of 50,000 tons per shipment requires two shipments plus one Handymax vessel. Alternatively, using a vessel with a capacity of 10,000 tons per shipment requires approximately 12 shipments per year. Shipments with large capacity handymax and panamax vessels are suitable for the European market, while smaller vessels, namely 10,000 tons/shipment, are suitable for the Japanese market.

Japan, with around 290 biomass power plants, should technically be able to move towards BECCS more quickly, but it's just a matter of policy and regulation. Installing CCS (Carbon Capture and Storage) units in biomass power plants makes the plant's operation carbon negative, or carbon (dioxide) removal (CDR) or Greenhouse Gas Removals (GGR). Furthermore, Europe has a successful example of BECCS implementation, namely the Stockholm Exergi BECCS project. This Stockholm project, based on sustainable biomass fuel, has secured one of the world's largest carbon sequestration agreements with Microsoft.

Furthermore, policy support for biomass power plants with CCS/BECCS or those capable of CDR/GGR is also increasing, as in the UK. This includes the indefinite extension of support for biomass power plants to allow time for plants to transition to BECCS. Modifications and retrofitting of existing power plants will eliminate millions of tons of CO2 annually while still generating electricity from renewable sources. This potential can only be maximized with government support for the transition to BECCS.

Replanting Palm Oil Plantations and Utilizing Old Palm Oil Trunks Waste (Presentation Version)

Aging plants are one factor in declining palm oil productivity. Palm oil trees begin to decline in productivity after 20 years and need to be replaced after 25 years. Therefore, rejuvenation or replanting must be carried out periodically according to the age of the trees.

Furthermore, the demand for palm oil continues to grow in line with global population growth. For the domestic market, biofuel use takes the form of a mandatory 40% palm oil blend in biodiesel (B40) this year, which is being reviewed to increase to 50% (B50) by 2026, and a 3% blend for jet fuel by 2026. Demand for the international market also continues to grow. The main destinations for Indonesian palm oil are India, China, Pakistan, Bangladesh, the United States, the Netherlands, Spain, Italy, Egypt, and South Africa.

Replanting palm oil plantations is crucial because it maintains sustainable palm oil productivity and prevents or reduces deforestation for new lands. The potential volume of old palm oil trunk waste generated is enormous, and there are numerous utilization options, including bioenergy, biocarbon, biomaterials, biofuels, and biochemicals.

To read and access the presentation, please download here. 

Biochar for Sustainable Palm Oil Productivity

The Indonesian government emphasized the importance of sustainable palm oil productivity for food and energy security, as conveyed by Deputy Minister of Agriculture Sudaryono, at the opening of ICOPE (International Conference on Palm Oil and Environment) in Sanur, Bali, mid-February 2025. The conference, attended by delegates from various countries, namely Indonesia, Malaysia, India, the Netherlands, France, Finland, Colombia, and Spain, aims to formulate a sustainable transformation for the palm oil industry. Sustainable palm oil productivity can be increased by land intensification and the use of superior seeds. Even if land expansion is necessary, it must be done without causing deforestation. Meanwhile, for replanting in dry land, it can also be combined with upland rice or corn through intercropping methods.

Biochar is a powerful solution
Palm oil productivity can be increased by improving fertilizer efficiency, or Nutrient Use Efficiency (NUE), as part of land intensification. Using the same fertilizer dose with the addition of biochar will increase palm oil productivity by around 20% or more. Fertilizer savings of around 30% with the addition of biochar will keep palm oil productivity relatively stable or at the same level as before. For efforts to increase palm oil productivity while avoiding deforestation, the first option is more appropriate: maintaining the same fertilizer dose as usual, but adding biochar to increase fertilizer efficiency.  

Indonesia's current CPO production reaches approximately 50 million tons/year across 16.4 million hectares, with an average CPO production of 3.55 tons/ha per hectare, or 3.55 million tons per million hectares. If biochar is used and productivity increases by 20%, this means an increase of 10 million tons of CPO per year (a total of 60 million tons of CPO per year), saving approximately 2.8 million hectares of land. The use of biochar will also slow down forest clearing (deforestation) for palm oil plantations.

Besides using biochar to increase palm oil productivity, other benefits from biochar production include the potential for carbon credits (BCR = biochar carbon removal) and the utilization of pyrolysis byproducts for palm oil plantations and palm oil mill operations in CPO production. This method offers several advantages for palm oil companies, such as savings in liquid organic fertilizer and pesticides, and the sale or export of 100% of the palm kernel shells (PKS). In addition to palm oil companies producing their own biochar through pyrolysis, it is also possible to establish separate companies or companies that collaborate with palm oil companies for biochar production under specific agreements.

Global pressure and scrutiny on the palm oil industry to adopt sustainable practices are increasing. Amidst soaring demand for palm oil in both global and domestic markets, increasing palm oil productivity is inevitable. Utilizing biomass waste from palm oil mills and plantations, such as empty fruit bunches (EFB) and trunks (OPT), for biochar production, and using biochar to increase palm oil productivity, is a powerful solution to address these challenges. Even for replanting dryland with upland rice or corn using intercropping methods, the use of biochar will also have a positive and significant impact on these intercrops. 

Biochar for Palm Oil Nurseries Part 2

In 2024, Malaysia reported that replanting their palm oil plantations reached 114,000 hectares, or 2% of the country's total area, compared to the targeted 4% to 5%. Indonesia's replanting rate is estimated to be lower, but because Indonesia's palm oil plantations are much larger, approximately three times Malaysia's, the area is larger. This situation has led to a decline in palm oil production, as palm oil productivity begins to decline after 20 years and requires replacement or replanting after 25 years to maintain productivity. Replanting should be carried out periodically, with an area of approximately 5% of the total palm oil plantation area.

Palm oil rejuvenation (replanting) requires palm oil seedlings. If estimated current replanting of palm oil plantations in Indonesia is 300,000 hectares per year (or 1.8% of Indonesia's oil palm plantation area), then with an average oil palm plantation population of 125 trees per hectare, the need for palm oil seedlings reaches 37,500,000. And with 114,000 hectares in Malaysia, the need for palm oil seedlings will reach 14,250,000 seedlings. Producing quality palm oil trees, in addition to selecting superior varieties, also includes seedling production in palm oil nurseries. Biochar can be used effectively in palm oil nurseries, as it helps improve seedling growth and health.

Biochar, made from biomass, functions as a soil amendment, improving soil structure, water retention, and nutrient availability, while also providing a favorable environment for the growth of soil microorganisms. Biochar can be mixed directly into the growing medium during nursery cultivation, with the dosage adjusted to the type of growing medium and the plant's needs. Numerous studies have shown that applying biochar to palm oil nurseries can improve seedling growth, including plant height, stem diameter, leaf number, and root dry weight. By utilizing biochar, palm oil nurseries can become more efficient, productive, and environmentally friendly.

And because the planting medium for palm oil seedlings generally uses compost, if the compost is enriched with biochar or the composting process also uses biochar, the compost quality will be even better. The advantages of the composting process using biochar include improving compost quality, accelerating the composting process, reducing greenhouse gas emissions in the form of methane (CH4) and nitrogen oxide (N2O), reducing ammonia (NH3) loss, increasing aeration (bulking agent) in composting, and reducing odor. As for the biochar material itself, it will enrich the biochar with various nutrients and the biochar is not damaged or decomposed during the composting process. So by utilizing biochar in composting, we can process organic waste more effectively, produce high-quality organic fertilizer, and contribute to more sustainable agricultural practices. 

Biochar for Palm Oil Nurseries

There are about 250 producers of palm oil seedlings in Indonesia, and with an area of the palm oil plantation reaching around 15 million hectares, these seedling producers are actually not many either. More specifically, Sumatra island has the largest area of palm oil plantations in Indonesia, making it the main economic activity in the area, because 70 percent of palm oil land in Indonesia is in Sumatra. With a cropping pattern, for example, 125 trees per hectare, 125,000 trees are needed for every 1,000 hectares or 1 million hectares for 125 million trees, while 15 million hectares means more than 1.8 trillion palm oil trees with current crude palm oil (CPO) production reaching more than 40 million tons per year. A very large number, of course. But not only the quantity factor, the seed quality factor is prioritized so that it has optimal productivity. Of course, the need for seeds does not necessarily mean millions or trillions of trees at the same time, depending on needs such as new plantings from new plantations (extensification) - which is currently being carried out in Indonesia or rejuvenation of palm oil plantations (replanting) which is carried out periodically.

One of the good palm oil seeds is determined by the quality of the growing media. The growing medium for palm oil seedlings generally consists of topsoil mixed with sand or organic matter to obtain a fertile medium. Compost or manure is often used to improve soil fertility by supplying nutrients to plants. With a tropical climate with high rainfall, nutrients can be easily washed away, besides that, low soil pH is also a separate obstacle for the growth of these seeds. By using biochar, nutrients or plant nutrients become more available, humidity and microbial activity will increase. This makes the quality of the planting medium high quality, so that the resulting palm oil seed products in the form of roots, plant height, number of leaves and plant weight are the parameters observed with the use of biochar which are also getting better.

Compared to using cocopeat, biochar has a number of advantages. Both cocopeat and biochar have uses in agriculture, but there are a number of differences between the two. Cocopeat has uses mainly as a planting medium because of its water holding capacity, while biochar besides having the ability to hold water like cocopeat also raises soil pH, holds or makes nutrients more available (nutrient retention), and also becomes a soil microbial colony so that Organic materials become quickly decomposed and absorbed by plants. Cocopeat will also decompose in a short time like compost, while biochar can survive and not decompose for hundreds of years. Under these conditions, biochar is also used to store CO2 (carbon sequestration) and obtain carbon credits with the carbon sink mechanism.

The palm oil nursery is the starting point that most determines the further growth of the palm oil in the field. The success of growing palm oil plants in the field is largely determined by the quality of the seeds planted. Seedlings that grow well in nurseries have high adaptability in the field. In practice, it has been proven by a number of studies that the use of biochar has a positive effect on palm seed products. The use of biochar in the range of 40% has become the best composition for the planting medium for the palm oil seeds. This should encourage producers of palm oil seeds to use biochar. If there is a need for biochar in large quantities for this purpose, please contact us. We can also provide technical specification data (COA) and also the biochar samples.

Business Model Utilization of Palm Oil Empty Fruit Bunches to Maximize the Profit of the Palm Oil Industry

Palm oil empty fruit bunches  (EFB) are still a problem for the palm oil mills in general. The scenario of utilizing palm oil EFB as the goal should be able to cope well with the environment and provide economic benefits. Overcoming environmental problems is clearly a top priority and must be met, but the best use of EFB scenarios should also benefit the environment, both short term and even long term. Likewise for economic benefits, economic benefits should also be obtained in line with these environmental benefits, not counterproductive. That is the best scenario for the use of palm oil EFB, which is currently still a problem.

Palm oil plantations are the production base for palm oil mills, both CPO mills and PKO mills. Without the palm fruit produced from the palm oil plantation, the palm oil mill will not be able to produce. Operation of palm oil plantations is indeed not an easy and expensive thing. This is mainly a factor of the large usage fertilizer demand, so as to reach around 60% for the operation of the palm oil plantations themselves or with an area of ​​20,000 hectares of palm oil plantations, the cost needs reach more than 70 billion rupiahs ( (around US$ 4,766,667), for more details, please read here. The factor to reduce the cost of fertilizer and maintain the productivity of palm oil fruits or fresh fruit bunches and even increase them is the main target for the utilization or processing of palm oil  EFB. If the cost of palm oil plantation operations can be reduced, the greater the benefits. Biochar is a palm oil EFB processing product that can be used to reduce fertilizer requirements in the palm oil plantation. Biochar production using pyrolysis as shown below.

In the process of pyrolysis, besides producing the main product in the form of biochar, then biooil and syngas are also produced. The biooil and syngas are then used as fuel generator to produce electricity. In palm oil mills or CPO mills, fiber waste is also commonly found. The fiber waste is often just piled up and never utilized so it tends to pollute the environment. Though these fibers can be made pellets for export and become fuel for power plants. In addition, currently millions of hectares of old palm oil plantations in Indonesia need to be immediately replanting. Millions of tons of old oil palm trunks are also potential for pellet production. If old oil palm trunks are only left in the plantation so they rot and decay, then it will become lava media and subsequently become a beetle which actually disrupts productive palm oil plantations as well as other plantations, for more details read here. The production of pellets from fiber or palm trunks requires electricity and this can be supplied from the pyrolysis of palm oil EFB like the scheme above. Although palm oil mills also produce electricity, but generally only for the purpose of CPO production, so it is not enough for the production of fiber pellets and oil palm trunk pellets (OPT pellets).