Is the income of independent smallholder oil palm after replanting with a conventional system greater than the underplanting system in supporting the sustainability of oil palm plantations?

Abstract

The sustainability of oil palm plantations is of particular concern from government. One of the problems that has not yet been realized is the target of replanting smallholder palm oil plantations. There are two replanting systems namely conventional and underplanting system. Some farmers do underplanting because it prevents farmers from losing their major source of revenue if they do not have oil palm plantations in more than 2ha. Smallholder oil palm producers in Sungai Bahar District with two system. The sampling approach employs simple random sampling with 44 sample conventional and 42 sample underplanting. According to the research findings, conventional system farmers' income is higher than underplanting farmers with difference comparison 20.7%. Farming income using conventional is IDR 22,323,490/ha/year, while underplanting is IDR 12,519,214/ha/year. The difference is seen at higher production levels in the conventional system. Besides that, the application Good Agriculture Practice in conventional systems also affects the condition of the Fruit Fresh Bunches produced, including the use of appropriate fertilizer. Oil palm farming has reached the account the minimum wage (UMK) level, even above the applicable UMK level, taking into UMK for the district of Muaro Jambi in 2023 of IDR 2,900,000 per month in both two-system replanting.