Agric. Econ. - Czech, 2025, 71(12):647-663 | DOI: 10.17221/231/2024-AGRICECON

Modelling the circular bioeconomy in the palm oil industry: Emerging approaches to address cattle feed shortages in IndonesiaOriginal Paper

Atien Priyanti ORCID...1, Priyono ORCID...1, I Gusti Ayu Putu Mahendri ORCID...2, Dwi Yulistiani ORCID...3, Hotmatua Daulay ORCID...1, Yuhendra4, Nasir Rofiq5, Astu Unadi6, Uning Budiharti ORCID...6, Adji Parikesit6, Arsyadi Ali ORCID...7, Edi Erwan ORCID...7, Muladno8
1 Research Center for Behavioral and Circular Economics, Research Organization for Governance, Economy, and Community Welfare, National Research and Innovation Agency, Jakarta, Indonesia
2 Research Centre for Macroeconomics and Finance, Research Organization for Governance, Economy, and Community Welfare, National Research and Innovation Agency, Jakarta, Indonesia
3 Research Centre for Animal Husbandry, Research Organization for Agriculture and Food, National Research and Innovation Agency, Bogor, West Java, Indonesia
4 Livestock and Animal Husbandry Provincial Office of Riau, Riau, Indonesia
5 Research Centre for Sustainable Production System and Life Cycle Assessment, Research Organization for Energy and Manufacture, National Research and Innovation Agency, Jakarta, Indonesia
6 Research Centre for Appropriate Technology, Research Organization for Agriculture and Food, National Research and Innovation Agency, Subang, West Java, Indonesia
7 Department of Animal Science, Faculty of Agriculture and Animal Science, State Islamic University of Sultan Syarif Kasim Riau (Universitas Islam Negeri Sultan Syarif Kasim Riau), Riau, Indonesia
8 Faculty of Animal Science, IPB University, Bogor, West Java, Indonesia

Indonesia is presently ranked as the first crude palm oil producer in the world. However, the palm oil industry faces significant challenges, including extensive criticism related to environmental degradation and social impacts. The circular bioeconomy concept emphasises sustainable production and consumption through the repurposing, recycling, and regeneration of resources to address these challenges. Integrating palm and cattle farming represents a promising approach to enhancing resource efficiency and sustainability in agricultural systems. This study employs a system dynamics analysis to model the circular bioeconomy in the palm oil industry, with a specific focus on addressing cattle feed shortages. The results demonstrate that utilising oil palm biomass can yield a total of 21 204.52 tonnes of feed and generate a yearly revenue of USD 317 020.14. Key findings indicate that integrating palm by-products into cattle feed not only addresses feed shortages but also reduces waste and enhances overall farm productivity. The implications of this study suggest that adopting circular bioeconomy practices in the palm oil industry can promote more resilient and sustainable agricultural practices.

Keywords: by-products; local resources; carrying capacity; value added; system dynamics

Received: July 2, 2024; Revised: June 2, 2025; Accepted: June 30, 2025; Prepublished online: December 15, 2025; Published: December 22, 2025  Show citation

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Priyanti A, Priyono, Gusti Ayu Putu Mahendri I, Yulistiani D, Daulay H, Yuhendra, et al.. Modelling the circular bioeconomy in the palm oil industry: Emerging approaches to address cattle feed shortages in Indonesia. Agric. Econ. - Czech. 2025;71(12):647-663. doi: 10.17221/231/2024-AGRICECON.
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