Ministry of Industry Builds Balai Litbang in Pekanbaru To Increase Value Added CPO

INDUSTRY.co.id - Pekanbaru, Riau is one of the provinces that have good economic growth, driven by the activity of palm oil processing industry.

This potential makes the Ministry of Industry initiative to form the Center for Product Development and Industrial Standardization (BPPSI) in Pekanbaru as an effort to spur areas that have considerable natural resources for high added value through research and development (R & D) and engineering activities.

"In accordance with the duties and functions, R & D Hall under the Industrial Research and Development Agency (BPPI) plays an active role in implementing the transfer of R & D technology to the user industry," said Head of BPPI Kemenperin Ngakan Timur Antara at the Coordination Meeting and inauguration of BPPSI in Pekanbaru, Riau, Thursday (23/11/2017).

Based on Central Bureau of Statistics (BPS) Riau data in 2017, Riau Gross Regional Domestic Product (PDRB) is the fifth largest nationally, under DKI Jakarta Province, East Java, West Java and Central Java or the largest for province outside Java.

Meanwhile, the largest contributor in the formation of GDP Riau is derived from net export value (net export) which reached 29.53 percent.

According to Ngakan, export value for fat and vegetable oil products reaches 68 percent of Riau province's total exports.

"Most of the processed palm oil products in Riau to date are still in the raw product of CPO, whereas the market potential is greater to be developed into derived products that produce high added value," he explained.

Ngakan explained  the palm industry is able to contribute significantly to Indonesia as the world's largest producer and exporter. This sector is able to absorb labor reaches 21 million people either directly or indirectly.

Based on data from BPS until September 2016, the value of exports of downstream palm products amounted to USD13.3 billion or has exceeded the value of oil and gas exports. Downstream products reach 54 types. On an average annual basis, upstream-downstream palm oil industry sector contributes USD20 billion to the country's foreign exchange.

In the field of processing industry, Indonesia has the opportunity to become the center of the global palm oil industry for food, non-food, and renewable fuels. The Ministry of Industry noted that Indonesia contributed 48 percent of world CPO production and controlled 52 percent of the export market of palm oil.

Potential industrial branches that can be developed from oil palm are oleo chemicals. This type of product can be utilized as a raw material for downstream industries for both food and non-food categories.

"In the future, the development of local superior commodity processing industry will be the key to the success of Riauseeng Riauseiring economic growth in the shrinking of oil and gas commodities," he said.

The oleochemical industry is considered a strategic sector because in addition to having comparative advantages through the availability of abundant raw materials, it also provides a high added value of production that is above 40 percent of the value of raw materials.

Therefore, the establishment of BPPSIPekanubuntend also to improve industrial competitiveness through standardized services. In addition, it helps the industry in the analysis of technology needs, market analysis and product development.

"In terms of technology procurement, BPPSI will be supported by other Technical Implementation Unit, Balai Besar and Research Center and Industrial Standardization which are spread in 16 provinces in Indonesia," said Ngakan.

BPPSI Pekanbaru is encouraged to cooperate and synergize with local agencies to see and map potentials that can be developed.

"For that, it needs to be built cooperation network with the company, industry association, business world, and research institute both at home and abroad," he concluded.