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Indonesia, the world's largest palm oil producer, said on Tuesday it attracted hundreds of millions of dollars in investment during the first quarter of 2025 as it seeks to boost value-added output from the strategic commodity.
The resource-rich country is currently working to develop its refining and processing industries so it can export higher value-added products. Indonesia has also expressed openness to domestic and foreign investors wishing to contribute to this industrial transformation. Although the primary focus remains on nickel processing, efforts are also under way to develop downstream industries for other commodities, chief among them palm oil, of which the country has abundant supplies.
Investment Minister Rosan Roeslani said at a press conference that Indonesia recorded realised investment in the palm oil processing sector worth 15.26 trillion rupiah between January and March 2025, equivalent to around $916 million. Such investment is considered essential to converting palm oil into higher-value products. However, this figure remains about a third of the investment attracted by the nickel processing sector over the same period, which reached 47.82 trillion rupiah.
"Nickel and its derivatives dominate our manufacturing investment... but we have long been working to develop the palm oil industry. We will continue to support the development of its derivatives to achieve greater added value and create more jobs," Roeslani added.
First-quarter 2025 data showed that palm oil was the most attractive option for investors within the agriculture and forestry sector, followed by raw timber (11.79 trillion rupiah) and rubber (3.08 trillion rupiah). Investors also put around 990 billion rupiah into other agricultural crops such as nutmeg, coconut, cocoa and biofuels. Roeslani did not specify which countries the investments came from, but noted that Malaysia alone invested around $400 million in Indonesian downstream industries, with about 54.5% of that investment going into the forestry sector.
According to data from Indonesian palm oil producers, the country's palm oil exports totalled 2.2 million tonnes in 2024, down noticeably from 2.5 million tonnes in 2023. The value of 2024 exports stood at around $2.9 billion. Indonesia and Malaysia together account for about 85% of global palm oil supply.
Source: Al Mal Forum