Abstract
Rapid development of oil palm plantations is predicted to cause various problems, one of which is the conversion of land and the shift of non-palm oil businesses to palm oil businesses. This research is aimed at analyzing the impacts of palm oil industry, through the price of palm oil in the international market, to the area and production of non-oil palm plantations (rubber, cacao, and coffee). The study employed time series data from 1991 to 2015. An econometric model was built to connect variables that affect the area and the production level of non-palm plantation and use multiple regression methods to determine its effect. The results showed that the price of palm oil had a positive effect on the expansion of rubber, cocoa, and coffee plantations. The effect of the price of palm oil on the production of non-palm plantations also shows a positive direction. Thus, the development of oil palm plantations does not have a negative impact on the development of non-palm plantations. The policy implications of the results of this study are the need to utilize the positive impacts of development of the palm oil industry for the development of plantations in the broadest sense.
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