Advancing Sustainable Palm Oil: Asian Agri’s Circular Economy Approach

Asian Agri, part of the Royal Golden Eagle (RGE) group founded by Sukanto Tanoto, manages around 100,000 hectares of oil palm plantations across Indonesia and works closely with independent and plasma smallholders to produce palm oil responsibly. As part of its sustainability efforts, the company is advancing a circular economy approach to make palm oil production more resource-efficient and environmentally responsible.

A circular economy moves away from the traditional “take–make–waste” model by keeping materials in use for as long as possible. At Asian Agri, this means finding ways to turn by-products from palm oil production into valuable resources instead of waste.

These efforts are already delivering measurable results. For example, 58% of empty fruit bunches are reused, helping return nutrients to plantation soils, while 54% of palm oil mill effluent (POME) is processed through methane capture facilities.

Circular practices are also contributing to cleaner energy. Across its mills, Asian Agri operates 11 biogas plants that convert methane from POME into electricity. Nearly 90% of the biogas produced is used to power operations, supplying about 40% of the company’s electricity needs while significantly reducing methane emissions.

Circular practices also support responsible water management. Asian Agri treats and reuses water within its mills before safely returning it to nearby rivers, ensuring that all discharges meet strict environmental standards.

For Asian Agri, the circular economy is an important step towards more sustainable palm oil production. By making better use of resources, reducing waste, and improving energy efficiency, the company continues to strengthen its commitment to responsible growth and environmental stewardship.