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Indonesia's Palm Oil Restructuring Creates Bottleneck for Smallholder Farmers

Indonesia's overhaul of its palm oil export framework is creating immediate disruption in the supply chain, with major refiners stepping back from purchases of fruit from independent growers. The government is investigating leading palm oil processors over export pricing practices, signaling heightened regulatory scrutiny across the sector. Farmers report fruit rotting in the field as traditional buyers withdraw, threatening both their incomes and overall production volumes. The nationalist push to control commodity shipments is reshaping buyer relationships and forcing consolidation pressures on the industry. Officials have indicated the restructuring aims to capture greater value domestically, though the transition has left smallholders vulnerable to sudden demand losses. Refiners appear to be recalibrating purchasing strategies ahead of new export requirements.