Decoding the Value Chain

State Governance

Individual state governments lay down the Oil Palm Act to oversee and regulate the Oil Palm industry.

Zonal Agreement

Companies sign agreements with respective state governments and are assigned specific zones of operation.

Nursery Setup

These companies establish nurseries to provide high-quality saplings to the farmers. Saplings are nurtured in the primary nursery for 3 months followed by secondary nursery for 6-9 months.

Extension Activities

Companies engage in extension activities to initiate planting operations through contract farming.

Farmer Onboarding

Once farmers are ready to plant, they enter into a tripartite agreement with the company and the government,  to commence operations

Scientific Assistance

Companies utilise advanced R&D facilities to perform Soil, Water, and Leaf analysis, ensuring optimum growing conditions and pinpointing any deficiencies.

Fertiliser Supply

Companies set up fertiliser stores, ensuring farmers have easy access to the required fertilisers.

Plantation Maintenance

The Oil Palm plantations are maintained under the strict supervision of the company.

MIS System

A robust Management Information System (MIS) is employed to facilitate and share information with the farmers.

Purchase Mandate

Companies are obligated to purchase the produce cultivated within their operational zones from the associated farmers.

Collection Centers

Companies establish collection centres equipped with weighment facilities at strategic locations. This allows farmers to deliver their produce on predetermined days.

Factory Setup

Every operational zone houses its Palm Oil factories, comprising a Palm Oil mill, refinery, and power plant.

Pricing Model

A pre-established formula determines the price of the produce. Ensuring transparency and fairness, the amount is credited to the farmer's bank account within 15 days. As a prerequisite, farmers are required to have a bank account.

Processing

Once collected, the produce is transported from the collection centres to the palm oil factories for processing.