Economic assessment of palm oil production

The introduction
and expansion of oil palm
in Indonesia reflects the crop’s economic
attractiveness and benefits, but the social interactions between companies and local communities have had a
mixed track record that requires attention. To some extent, oil palm plantations have been portrayed as costly
from social and environmental perspectives.
To understand the economic benefits of palm oil production, we analyzed both private and financial returns at the
plantation level as well as the return to labour. Socially, interaction areas were identified as the result of labour
requirements of oil palm plantations and the profitability of independent and plasma smallholders’ plantations.