Agriculture & food
Indonesian palm oil
Indonesia is the largest palm oil producer in the world, and its oil moves as CPO, as refined olein and stearin, and as palm kernel oil. Three separate compliance questions sit on top of any order: ISPO, which is Indonesian law, whatever voluntary scheme your customers ask for, and the European deforestation regulation.
How it leaves the country.
- Crude palm oil
- The unrefined oil pressed from the fruit, shipped in bulk parcels and refined at destination. Contracted on free fatty acid, moisture and impurities.
- Refined olein and stearin
- The liquid and solid fractions after refining, bleaching and deodorising. Olein is the cooking oil fraction and the volume export.
- Palm kernel oil
- Pressed from the seed instead of the fruit. A different oil with a different fatty acid profile, and a separate market from CPO.
- Palm kernel expeller
- What remains after the kernel is pressed, sold as animal feed. Low value per tonne and shipped in volume.
How it is graded.
The certification question is where palm oil orders go wrong, and the confusion is consistent enough to be worth spelling out. ISPO and RSPO are not two versions of the same thing.
- ISPO is compulsory
- Indonesian sustainable palm oil certification is required of plantation businesses by presidential regulation. A producer cannot opt out of it in favour of something else.1
- The current instrument is Perpres 16/2025
- Signed on 19 March 2025, replacing the 2020 regulation it revoked. A supplier still citing the 2020 rule is working from an out of date file.1
- RSPO is a separate, voluntary matter
- An industry scheme with no standing in Indonesian law. Whether you need it depends on your own customers and your own market, and holding it does nothing to remove the ISPO obligation.
- Mass balance against segregated
- Certified supply is sold under several chain of custody models, and they mean different things physically. Name the model in the contract, because the price difference between them is real.
How it is packed.
- Bulk parcels
- Shipped in the tanks of a parcel tanker, heated for discharge. This is how volume oil moves and it sets a floor on order size.
- Flexitanks and drums
- Smaller quantities travel in a flexitank inside a standard container, or in drums for speciality fractions. Both cost more per tonne than a bulk parcel.
- Previous cargo matters
- For edible use the tanks have a documented cleaning and previous cargo history. Ask for it before loading rather than after.
Where it grows.
Riau
Sumatra
The largest producing province and the centre of the refining industry, with Dumai as its export port.
North Sumatra
Sumatra
The oldest plantation region in the country, with Belawan handling much of the export.
Central Kalimantan
Borneo
A large and more recently developed producing area, which is exactly why the deforestation question is asked hardest here.
West Kalimantan
Borneo
Substantial planted area feeding both domestic refining and export through Pontianak.
Choosing between this and something else.
Documentation, where applicable.
- ISPO certificate
- Held by the plantation and the mill. Compulsory under Indonesian law and worth verifying against the certifying body rather than a scan.1
- EUDR due diligence statement
- Oil palm is one of the seven commodities the regulation covers, so European buyers need geolocation of the producing plots.2
- Certificate of analysis
- Free fatty acid, moisture, impurities and, for refined grades, colour and the contaminants your market limits.
- Certificate of origin
- Which form applies depends on the destination and the preference scheme between it and Indonesia.
- Bill of lading
- For a bulk parcel this travels with a tank cleaning record and a previous cargo declaration.
Questions buyers ask.
Do I need RSPO or ISPO?
ISPO is not yours to choose. Indonesian law requires plantation businesses to hold it, so any legitimate supplier already has it. RSPO is a voluntary scheme, and whether you need it depends on what your own customers ask for. A supplier offering one in place of the other has misunderstood their own obligations.
Does the European deforestation regulation cover palm oil?
Yes. Oil palm is one of the seven commodities named in the regulation, and it reaches derived products as well as the oil itself. What a European buyer needs is geolocation for the plots the fruit came from, which is a data problem for the supply chain long before it is a paperwork problem at the border.
Can I buy less than a bulk parcel?
Yes, in flexitanks or drums, and it costs more per tonne. The economics of palm oil are built around parcel tankers, so a container-sized order is priced as an exception. Decide the volume before asking for quotations, because the two routes are not comparable on price.
What does your service cost?
Five per cent of the order value, paid by you and never by the factory. A factory audit starts at $250 depending on location. We work with orders from $10,000 per shipment.
Worth reading.
Tell us what you need.
Give us the specification and the destination port. We come back with producer options and an indicative price. Our fee is 5 % of the order value, paid by you and never by the factory.
Sources
- 1Presidential Regulation 16/2025 on the Indonesian sustainable palm oil certification system. Database Peraturan, Republic of Indonesia. Checked 5 August 2026.
- 2Regulation (EU) 2023/1115, consolidated text. EUR-Lex. Checked 3 August 2026.