Authors: Diana Chalil dan Riantri Barus

Palm oil is one of the important commodities in the international trade. Its high demand leads dominant palmoil producer countries to increase their production by extending the plantation areas. This raises concerns about the impact on environmental quality. To address this, the Roundtable on Sustainable Palm Oil (RSPO) established Principles and Criteria for sustainable oil palm plantations management. However the Principles and Criteria are relatively complex to implement, especially for smallholders. In fact, smallholders appear to be a significant number among oil palm producers, contributing more than 40 percent of the oil palm plantations total area in Indonesia. To analyze the implementation of the Principles & Criteria among smallholders, this study was conducted in the Kabupaten Asahan, Labuhan Batu, Labuhan Batu Utara, and Labuhan Batu Selatan which are the centers of the smallholders’ oil palm plantations. Data were collected from 228 smallholders, which were determined through the stratified cluster sampling and were then analyzed by the Structural Equation Modeling (SEM). The estimation results indicate that the implementation of the Principles and Criteria of the RSPO is still relatively low, which is stemmed from the lack of individual and institutional documents, and the lack of both knowledge and practice of the sustainable oil palm plantations management. Such a condition is influenced by size of the smallholders’ oil palm plantation and by their participation in the farmer groups. Their positive value indicate that smallholders with large plantation area have relatively high ability to meet the cost of implementing the RSPO Principles and Criteria, while participation in the farmer groups are likely to improve smallholders’ knowledge and preparation of various required documents in the RSPO Principles and Criteria. 

Keywords: oil palm smallholders, RSPO Principles and Criteria implementation, SEM