THE Oil Palm Industry Corporation (OPIC) has reaffirmed the government’s commitment to transforming Papua New Guinea’s oil palm sector by doubling production and increasing export revenues, according to OPIC General Secretary Kepson Pupita.
Speaking during the presentation of the OPIC report at a high-level agriculture meeting officiated by Prime Minister Hon. James Marape in Port Moresby on Tuesday, 4 February 2025, Pupita outlined the industry’s past performance, key challenges, and ambitious plans under the Medium-Term Development Plan IV (MTDP IV) 2023-2027.
“The government’s goal is to increase oil palm production from 657,000 tonnes in 2021 to 1.3 million tonnes by 2027, while also boosting palm oil export value to K5.3 billion. This will account for 66% of total agriculture sector exports, making oil palm a leading driver of economic growth and employment,” Pupita stated.
He further highlighted that the oil palm industry has contributed K28.1 billion in export revenue from 1990 to 2024, reflecting a 7,640% increase in export earnings over the years.
Strategic Initiatives to Drive Industry Growth
To achieve these ambitious targets, Pupita outlined a series of government-backed key strategic initiatives, including:
• Establishment of the National Oil Palm Authority – This new body will provide regulatory oversight, policy guidance, and industry coordination to ensure efficiency and sustainable growth.
• Redevelopment of 10 rundown plantations – OPIC is working with stakeholders to revive abandoned and underperforming plantations, particularly in West New Britain, Oro, and Milne Bay provinces.
• Mobilisation of customary land for large-scale commercial plantations – The government is partnering with local landowners to unlock vast areas of land for commercial cultivation while ensuring landowners benefit through equity participation.
• Replanting and extension services for smallholder farmers – Recognising the importance of smallholder growers, OPIC is ramping up support in the form of seedlings, training, and farm inputs.
• Rehabilitation and maintenance of 200km of smallholder access roads – Poor road conditions have been a major constraint for smallholder farmers in getting their produce to markets. OPIC’s road rehabilitation programme aims to improve transport efficiency and reduce post-harvest losses.
• Development of downstream processing and industrial hubs – The government is investing in value-added processing facilities to encourage local refining, reduce dependency on crude palm oil exports, and create jobs.
• Establishment of five commercial nurseries – These nurseries will supply high-yield hybrid seedlings to boost productivity and ensure long-term industry sustainability.
• Capacity Building and Workforce Development – OPIC is investing in the rehabilitation and maintenance of staff houses and offices to improve working conditions. Additionally, the organisation is recruiting 25 new extension officers to enhance technical support for smallholder farmers while managing 20 staff retrenchments to streamline operations.
“The government is committed to creating an enabling environment for growth, sustainability, and inclusivity in the oil palm sector through better infrastructure, policy support, and direct assistance to smallholder farmers,” Pupita added.
PNG’s Engagement with the Council of Palm Oil Producing Countries (CPOPC)
PNG is now a recognised member of the Council of Palm Oil Producing Countries (CPOPC), an intergovernmental organisation formed to represent the collective interests of palm oil-producing nations.
Objective of Membership:
• Strengthen PNG’s position in the global palm oil market.
• Advocate for sustainable palm oil production.
• Address trade barriers and environmental concerns, including EU deforestation policies.
• Promote smallholder farmer inclusivity in global palm oil trade.
Bilateral Engagements with Indonesia
• PNG participated in the Indonesia Head of Agencies Bilateral Monitoring & Evaluation Meeting.
• Talking points were prepared for PNG’s General Secretary, outlining PNG’s interests in palm oil trade, industry regulations, and sustainability practices.
Participation in CPOPC-Sanctioned International Meetings
• PNG is actively engaging in CPOPC-sanctioned international forums to influence global policies affecting the palm oil industry.
Focus Areas of Engagement:
• Global palm oil trade regulations and standards.
• EU Deforestation Regulation (EUDR) and its impact on PNG exports.
• Sustainability and climate-related issues in palm oil production.
• Capacity-building for PNG’s smallholder oil palm farmers.
Budget Allocation for 2025:
• K1 million allocated for participation in CPOPC international conferences and policy meetings.
• K5 million allocated to broader industry engagement efforts under OPIC Capacity Building and International Familiarisation Trips.
Strategic Benefits for PNG
By joining CPOPC and engaging in global palm oil forums, PNG aims to:
• Expand its market access for palm oil exports.
• Ensure fair pricing and trade practices for PNG palm oil.
• Position itself as a sustainable palm oil producer in compliance with international standards.
• Secure investment partnerships for downstream processing and industrial development in the palm oil sector.
• Gain policy support to counter restrictive EU regulations affecting palm oil exports.
Expansion into New Provinces: Unlocking PNG’s Oil Palm Potential
OPIC is aggressively expanding oil palm cultivation into new provinces to increase production and attract investment. Key areas identified for new development include:
Morobe Province
• OPIC has secured 155,500 hectares for large-scale oil palm development.
• A draft Memorandum of Understanding (MoU) between OPIC and the Morobe Provincial Government is awaiting final signing.
• Customary landowner awareness programmes have been conducted in the Markham Valley, a prime agricultural zone with high potential for commercial oil palm cultivation.
• The government has already allocated K600,000 to kick-start the first phase of planting.
Madang Province
• OPIC has initiated discussions with the Madang Provincial Government on large-scale oil palm expansion.
• The province’s fertile soil and favourable climate make it suitable for sustainable oil palm cultivation.
• A formal land-use agreement is being finalised to facilitate investment in commercial plantations.
Sepik Plains
• The North and South Bank of the Sepik River have been identified as high-potential areas, covering a total of 1.2 million hectares.
• OPIC is working with landowners and provincial leaders to implement a sustainable oil palm development model that balances economic benefits with environmental protection.
Kikori Basin (Gulf Province)
• The Kikori Basin has 133,300 hectares available for oil palm development.
• OPIC is conducting feasibility studies to ensure that any future investment aligns with environmental sustainability and community engagement principles.
A Pillar of Economic Growth and Rural Development
The agriculture sector meeting, chaired by Prime Minister Marape, reaffirmed the government’s commitment to supporting the oil palm industry as part of its broader economic diversification agenda.
PM Marape commended OPIC for its proactive approach in driving reforms and ensuring that oil palm remains a key pillar of PNG’s non-mineral economy.
With strong government backing, increased investment in infrastructure and research, and a strategic expansion plan, the oil palm industry is poised for robust growth in the coming years.
“Oil palm has already contributed immensely to our economy, and with the right policies, investment, and leadership, we can elevate this industry to greater heights—creating more jobs, empowering our smallholder farmers, and driving sustainable economic growth,” Pupita concluded.
