Social distancing leads to decreased supply of palm kernels in Indonesia

Following the social distancing effort that has been issued by the central government in Indonesia to fight the spread of the COVID-19, most palm oil manufacturers are experiencing a lower supply of palm kernel fruit bunches, which are the main ingredients to make crude and refined palm oil. The palm oil industry in Indonesia is highly labor intensive as the production of palm kernel fruit bunches still relies heavily on humans, as opposed to the automation process. This social distancing has forced the majority of the palm oil manufacturers to reduce the actual number of their employees on the plantations, hence slowing down the supply of the fruit bunches considerably.