Negotiating Livelihood Resilience: Everyday Strategies of Independent Oil Palm Smallholders Facing Market and Policy Shocks

Oil palm cultivation has contributed significantly to poverty reduction and rural development in Indonesia, with independent smallholders managing a substantial share of the national oil palm area and playing a key role in the sector’s longterm sustainability. Yet these farmers are increasingly exposed to intertwined market and policy shocks, including volatile crude palm oil (CPO) prices, abrupt domestic regulatory changes, and emerging international sustainability regulations such as the EU Deforestation Regulation (EUDR). This qualitative literature review synthesizes recent empirical and conceptual work published since 2020 to examine how independent oil palm smallholders in Indonesia negotiate resilience in their livelihoods amid such shocks. Building on the Sustainable Livelihoods Approach and contemporary resilience theory, the article identifies three broad sets of strategies: absorptive strategies that enable households to endure short-term income shocks; adaptive strategies that involve livelihood and agronomic adjustments; and transformative strategies that seek to alter structural conditions through collective action, engagement with certification, and participation in state programmes. The review shows that smallholders’ ability to deploy these strategies is shaped by differential access to livelihood capitals, land tenure security, value-chain power relations, and the design and implementation of public policies. The article argues that resilience should be understood as a negotiated, context-specific process rather than a fixed attribute. It proposes policy directions to strengthen independent smallholders’ contributions to an inclusive and sustainable palm oil sector in Indonesia. JEL Classification: Q12; Q18; O13; Q56; Q15