Livelihood Framework in Analyzing Decision-Making Process of Oil Palm Smallholders for Intensification and/or Expansion

Abstract
To meet the high global demand of oil palm and decrease the negative environmental impact of oil palm at the same time, there is a support for oil palm producers, including smallholders, to improve their productivity in the existing land (intensification), instead of creating new plantings (expansion). In this research, I focus on Petaling area, especially Sido Mukti village, in Jambi to
analyze which factors and how these factors affect smallholders‟ decision in intensification and expansion. In this case study, by using the livelihood framework and the concept of terms of incorporation, I analyzed how historical background of smallholders, the relationship between smallholders and local organizations, and access to capitals affect smallholders‟ decisions and practices in intensification and expansion. Certification is addressed as a factor in the analysis of the relationship between smallholders and local organizations. This study found that the main factors for smallholders to decide for intensification are access to inputs, access to knowledge about better management practices, labour issues, and certification. Regarding the expansion, it is found that smallholders‟ decision for expansion depends on the type of the land and access to financial capital. Transmigration and Nucleus Estate Scheme (Perkebunan Inti Rakyat/PIR) programs from the government compared to spontaneous oil palm planting are the basic reasons of the different decisions and practices of smallholders for intensification and expansion. Moreover, the dynamic relationship among smallholders and companies, the role of NGOs, and the involvement of certification in the oil palm management are the indirect factors that affect smallholders‟ decision and practices in intensification and expansion.