Achieving a high-productivity, sustainable palm oil sector in Indonesia: a landscape management approach

This research paper by the Climate Policy Initiative describes a landscape management approach designed to transform Indonesia's oil palm sector into a high-productivity, sustainable industry. The approach, supported by Unilever and IDH, moves beyond simple supply chain traceability to manage agricultural production and ecosystem protection across connected areas of land at scale. The document details a five-step implementation process and highlights a pilot project in Sei Mangkei, North Sumatra, aimed at improving land-use planning, increasing smallholder productivity, and protecting peat and forest ecosystems.

• Unilever's sustainable palm oil policy focuses on three primary goals: halting deforestation, protecting peat land, and driving positive economic and social impact. By 2014, the company achieved 70% traceability of its palm oil supply chain to known mills, identifying 1,800 crude palm oil mills globally.
• A landscape management approach is proposed as a superior alternative to plantation-by-plantation management because it allows for net positive environmental impacts and improved smallholder livelihoods at scale. The approach consists of five steps: defining landscape boundaries, partnering with stakeholders, mapping and allocating land to its highest value use, increasing productivity while protecting ecosystems, and monitoring results.
• In the Sei Mangkei landscape management pilot in North Sumatra, boundaries are determined by balancing business investment (a 100km radius from the fractionation facility), environmental needs (protecting peat and forest), and administrative district boundaries. The proposed pilot area includes the districts of Simalungun, Serdang Bedagai, Asahan, Labuan Batu Utara, and Batu Bara, which contain over 40% of North Sumatra's oil palm and 25% of its peat soils.
• Smallholder farmers are critical to the sector's transformation as they manage approximately 40% of oil palm plantations in Indonesia. In North Sumatra, an estimated 332,868 households manage 526,510 hectares of smallholder plantations, with over 40% of these households located within the Sei Mangkei pilot area.
• There is significant potential for improving land-use planning by utilizing degraded lands within forest estates. In Central Kalimantan, there are an estimated 5.3 million hectares of degraded land, while North Sumatra has approximately 1.1 million hectares of degraded land.
• A critical challenge for smallholder farmers in North Sumatra is the need for replanting, as most plantations were established in the late 1990s and approximately two-thirds of the area will require replanting before 2020.

APA

Climate Policy Initiative (2015). Achieving a high-productivity, sustainable palm oil sector in Indonesia: a landscape management approach. https://www.climatepolicyinitiative.org/wp-content/uploads/2015/06/Achieving-a-high-productivity-sustainable-palm-oil-sector-in-Indonesia-a-landscape-management-approach.pdf

Chicago

Climate Policy Initiative. Achieving a high-productivity, sustainable palm oil sector in Indonesia: a landscape management approach. 2015. https://www.climatepolicyinitiative.org/wp-content/uploads/2015/06/Achieving-a-high-productivity-sustainable-palm-oil-sector-in-Indonesia-a-landscape-management-approach.pdf.

Wikipedia

{{cite report |author=Climate Policy Initiative |title=Achieving a high-productivity, sustainable palm oil sector in Indonesia: a landscape management approach |date=June 2015 |url=https://www.climatepolicyinitiative.org/wp-content/uploads/2015/06/Achieving-a-high-productivity-sustainable-palm-oil-sector-in-Indonesia-a-landscape-management-approach.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{climatepolicyinitiative2015achieving, author = {{Climate Policy Initiative}}, title = {{Achieving a high-productivity, sustainable palm oil sector in Indonesia: a landscape management approach}}, institution = {Climate Policy Initiative}, year = {2015}, month = jun, url = {https://www.climatepolicyinitiative.org/wp-content/uploads/2015/06/Achieving-a-high-productivity-sustainable-palm-oil-sector-in-Indonesia-a-landscape-management-approach.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }