Indonesia has announced plans to impose fines totalling $8.5 billion on palm oil growers and mining companies found to be operating illegally in forest areas, marking one of the country’s largest crackdowns on environmental violations.
Attorney General Sanitiar Burhanuddin revealed the figures during a ceremony in Jakarta, noting that the forestry task force established by President Prabowo Subianto has already seized 4.1 million hectares of land from illegal plantations and mines.
The confiscated area is roughly the size of the Netherlands, underscoring the scale of the enforcement drive.
Burhanuddin said fines collected so far amount to 2.34 trillion rupiah ($139.7 million) from 20 palm oil firms and one nickel miner.
He added that in 2026, the government expects potential revenues of 109.6 trillion rupiah ($6.54 billion) from palm oil companies and 32.63 trillion rupiah ($1.95 billion) from mining operations.
The task force, comprising military personnel, police, prosecutors, and government officials, has been tasked with reclaiming forest land and penalising companies that have encroached on protected areas.
At the same ceremony, Burhanuddin transferred more than 240,500 hectares of seized plantations to Agrinas Palma Nusantara, a state-owned enterprise created in 2025.
With this addition, Agrinas now controls 1.7 million hectares, making it the largest palm oil company globally by land area.
President Prabowo praised the task force’s efforts, vowing to intensify the campaign in 2026. “Even though the work, the journey is tough, I have an instinct in 2026 we will take even bolder steps … We will save this nation’s wealth without hesitation,” he said.
The crackdown has rattled the palm oil industry, which is already facing pressure from Indonesia’s ambitious biodiesel programme.
Analysts warn that disruptions to production could push global palm oil prices higher, affecting supply chains worldwide.
Indonesia is the world’s largest exporter of palm oil, thermal coal, nickel, and tin. The government’s aggressive enforcement reflects its dual priorities of protecting forest resources while consolidating control over lucrative commodities.
However, industry observers caution that the measures could spark disputes with companies and investors, particularly if fines are levied without transparency.
With the forestry task force signalling tougher action ahead, 2026 may prove pivotal in reshaping Indonesia’s resource sector and its global role in commodity markets.
Sources: Reuters, Jakarta Post, Channel News Asia, The Straits Times
