Indonesia has taken over about 85,000 hectares of land used for sugarcane farming and processing from Sugar Group Companies (SGC), one of the country’s largest private sugar producers, after authorities said the land legally belongs to the government, reported Reuters.
The move has raised concern in the country and pushed up global palm oil prices as Indonesia is world’s biggest producer of palm oil.
The takeover is part of a wider government drive to reclaim plantations and mining areas that are considered to be operating illegally.
Minister of Agrarian Affairs and Spatial Planning Nusron Wahid said all permits covering the land had been cancelled. He said the area, which includes sugarcane fields and a sugar factory, would be returned to its rightful owner, the Defence Ministry, and placed under the control of the Indonesian Air Force.
SGC did not immediately respond to a request for comment, stated news agency Reuters.
The land is located in Lampung province on the island of Sumatra. Nusron said reviews carried out by the Supreme Audit Agency in 2015, 2019 and 2022 found that the land was owned by the Defence Ministry, specifically the Air Force.
He explained that while the company had been granted government-issued rights to use the land, those rights did not change the fact that ownership remained with the state. The Air Force operates under the Defence Ministry.
The minister did not clarify why the government chose to reclaim the land at this time, despite the most recent audit having been completed four years ago.
According to Nusron, the Air Force plans to convert the seized land into a training facility for military personnel.
Since it was established early last year, the military-backed forestry task force has taken control of about 8,800 hectares of land previously used for mining activities such as nickel, coal, quartz sand and limestone. It has also seized palm oil plantations covering around 4.1 million hectares, an area roughly the size of the Netherlands.
