Potential analysis of oleochemical palm oil industry in Lampung Province

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Dian Fajarika, Hersa Dwi Yanuarso, Eka Nur Azmi

2023 AIP Conference Proceedings Vol. 2623 Issue 1 Conference paper Cited by 1 SDG 8 Quartile

Abstract

One of ways to add value on palm oil products is by processing them into oleochemical products. Recently, the market opportunity for oleochemical industry is still wide. There is the insufficient supply of 290 thousand tons of oleochemical demand in the world. Indonesia, as one of country that has the largest production for palm oil, has a good opportunity to develop palm oil products. Moreover, it is supported by government policies to encourage downstream oil products. One of province in Indonesia that potentially for developing palm oil products is Lampung. Most of the palm oil companies in Lampung only produce crude palm oil (CPO). One of the major efforts to increase the added value of palm oil products is by the development of the oleochemical industry. The purpose of this research is to analyze the potential development of oleochemical industry, to find important factors to consider in the establishment of the oleochemical industry and to calculate the benefits that can be obtained from oleochemical industry. In addition, this study aims to find the benefits that can be achieved from economic, social and environmental aspects. The method used in this research use primary and secondary data. The primary data use expert interview used for finding important factor about oleochemical industry development. It also used data from government and companies related palm oil production. The secondary data use literature related palm oil development. The potential analysis use cost benefit methods. Determination of benefit analysis results indicators by comparing the benefits with the costs arising from the oleochemical industry (B / C).The result show that the benefit cost ratio is 1,42 that greater than 1. It can be explained that oleochemical development project is feasible. Some factors that influenced such as raw material volume, government commitment and technology. © 2023 Author(s).

Affiliations

Department of Industrial Engineering, Institut Teknologi Sumatera, Lampung Selatan, Indonesia; Department of Agroindustrial Technology, Institut Teknologi Sumatera, Lampung Selatan, Indonesia

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