The governance of oil palm Fresh Fruit Bunch (FFB) prices in the Bangka Belitung Islands Province continues to face severe obstacles, characterized by weak supervision and low price information transparency that disadvantage independent smallholders. A study conducted by Jhon Hendri, Selamet Riyadi, and Setyani Dwi Lestari from Universitas Budi Luhur in 2026 investigates this supply chain chaos to formulate fair protection strategies and secure farmers' welfare amid market volatility.
The oil palm plantation sector serves as the primary driver of the rural economy in Bangka Belitung, where the majority of operators are independent smallholders highly dependent on FFB price stability. However, global market fluctuations and shifting policies frequently create structural imbalances between farmers and palm oil mills. Farmers typically occupy a weak bargaining position due to extended marketing chains and a heavy reliance on intermediaries. Consequently, actual farm-gate prices often deviate significantly from official government-set reference prices.
To uncover the root causes, the researchers utilized a descriptive qualitative approach. Data collection involved in-depth interviews with various stakeholders—including plantation office officials, mill managers, farmer associations, village heads, and independent smallholders—alongside field observations and document analyses.
Based on the analysis, several key findings regarding FFB price governance were identified:
- Low transparency in price information prevents farmers from effectively verifying official government reference prices.
- Market information asymmetry is frequently exploited by intermediaries to dictate pricing at the grassroots level.
- Price supervision in the field remains purely administrative and fails to consistently monitor real-world transactions.
- Independent smallholders experience severely limited bargaining power due to small operational scales and minimal direct access to processing mills.
Responding to these challenges, the researchers formulated a comprehensive protection strategy model grounded in proactive market orientation. Jhon Hendri and colleagues emphasize that safeguarding smallholders requires structural reform rather than reactive measures during price downturns. Proposed solutions include strengthening farmer institutions through cooperatives, developing transparent digital price tracking systems, implementing participatory monitoring involving local village governments, and establishing equitable partnerships with processing mills. Furthermore, creating a Multi-Stakeholder Forum is deemed vital to streamline dialogue, oversight, and continuous policy evaluation to uplift farmer livelihoods.
Author Profiles
- Research Team: Jhon Hendri, Selamet Riyadi, and Setyani Dwi Lestari
- University Affiliation: Universitas Budi Luhur, Jakarta
- Fields of Expertise: Business Management, Plantation Governance, and Agribusiness Marketing
Research Source:
- Article Title: Governance of Fresh Oil Palm Fruit Bunch Prices: Challenges of Supervision and Protection Strategies for Independent Smallholders in the Bangka Belitung Islands Province
- Journal Name: Indonesian Journal of Business Analytics (IJBA), Vol. 6, No. 4
- Publication Year: 2026
- DOI:
https://doi.org/10.55927/ijba.v6i4.16840
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