Palm oil tested on sustainability

 Palm oil tested on sustainability

04 March 2010

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Indonesia —  Palm oil plantations play a major role in the growing problems of deforestation and greenhouse gas emissions in Indonesia and tropical woodlands around the world. Last week’s gathering of the International Conference on Oil Palm and Environment (ICOPE) is one move toward making the industry part of the solution.

Whether the palm oil industry can, in fact, be part of the solution to deforestation is a proposition that divides palm oil producers, manufacturers, retailers, and, naturally, environmental groups. At one extreme, sustainable palm oil production is considered an oxymoron. The opposite fringe sees critics of palm oil as dupes of a developed-world plot against poor farmers, built on myths of species extinction and climate change, funded by palm’s rival oil and fat producers.

Palm oil is a healthy, cost-effective alternative to other vegetable oils, with yields per hectare up to 10 times greater than competing oils. It’s a key ingredient in soaps, cosmetics and many prepared foods. It is also touted, less reliably, as a source of biofuel and poverty eradication. Palm oil has come under fire as an alleged motivation for the widespread destruction of rainforests in Indonesia and Malaysia, which jointly account for more than 85% of global palm oil output.

Even though palm plantations – and logging companies – plant trees, they’re not the native varieties that support traditional local ecosystems. Expansion of palm oil production can have an insidious, multi-layered impact on forests.

In Kalimantan (Indonesian Borneo), land clearing for plantations begins with logging the existing timber. In some cases, the action ends there; Indonesia has severely curtailed logging permits, so some loggers now feign interest in palm oil development as a cover for logging, and walk away from the land after denuding it.

Land clearance for plantations continues with burning, releasing tons of carbon from trees and even more on peat land, where centuries of accumulated carbon in the ground can burn for months. Even when not sited on peat land, the plantations often push locals onto those marginal lands, where their slash and burn techniques release peat. Deforestation accounts for 40% of Indonesia’s total emissions and helps envelope the region in haze annually.

Smoking guns
The Malaysian Palm Oil Council (MPOC), a trade group that adopts the unrepentant tone of the 20th century US tobacco industry, takes credit for “increasing biodiversity” by pushing more animals into smaller areas – a boon to tourism in the short-run but most likely unsustainable for wildlife in the longer run.

Indigenous animal species, including the critically endangered orangutan, Sumatran rhino and tiger, are frequently forced either into tiny pockets of remaining forest land or into populated areas and plantations, where they’re treated as pests. MPOC touts orangutan incursions into palm plantations as signs its members have created a “friendly” environment for the apes, rather than evidence of the scale of their habitat’s destruction.

Last week’s ICOPE meeting came at a particularly challenging time for the palm oil industry. In October Nestle, the world’s largest food company, and British retailer Marks & Spencer announced they would use only certified sustainably produced palm oil by 2015. MPOC has condemned these decisions as misinformed, malicious attacks on struggling tropical farmers by rich country interests with shadowy agendas.

The failure of the UN climate change conference in Copenhagen to take meaningful action thwarted, at least temporarily, hopes to have palm oil plantations included in the Reducing Emissions from Deforestation and Degradation (REDD) scheme. If approved, REDD could bring hundreds of millions of dollars in new investment to the industry. Critics charge it would encourage more conversion of forests to plantations: to paraphrase the adage from the American war in Vietnam, destroying the rainforest in order to save it.

Also in December, Unilever, the world’s largest user of palm oil for food, cleansers and cosmetics, canceled its US$32.6 million supply contract with Sinar Mas, Indonesia’s leading palm oil provider, after independently verifying a 2008 Greenpeace report implicating Sinar Mas in rainforest destruction. Unilever also has pledged to use only certified sustainable palm oil by 2015, targeting 30% of its total of about 1.5 million tonnes this year and 60% by 2011, without passing on any added costs to consumers. Last month, Unilever announced that its palm oil suppliers should not source from another Indonesian grower, Duta Palma, shown in a BBC documentary to have cleared rainforest for plantations.

Roundtable runaround
Sinar Mas and Duta Palma, as well as Unilever, are members of the Roundtable on Sustainable Palm Oil (RSPO), founded in 2004 to develop and implement global standards for sustainable palm oil. RSPO backs the GreenPalm and UTZ Certified platforms for trading certified palm oil (CPO). The first batches of CPO came onto the market in late 2008. Monthly production is up to 120,000 tonnes per month, and January was the first month where demand for CPO matched supply, according to RSPO.

RSPO’s 327 full members include palm oil producers and traders, consumer goods manufacturers, retailers, bankers and investors, environmental groups, and developmental organizations. Unilever’s director of sustainable agriculture, Jan-Kees Vis, serves as RSPO’s president. Environmental group WWF (formerly the World Wildlife Fund) is one of the driving forces behind RSPO, with a WWF Malaysia official serving as RSPO’s vice president and a WWF Indonesia official occupying an executive board seat. (WWF did not respond to requests for comment for this article.)

Many groups have questioned the efficacy of RSPO, which relies on self-assessment and voluntary standards to determine sustainability. Unilever uses both RSPO and independent verification for its sustainable palm oil purchases. In November, RSPO failed to include criteria on carbon emissions in its sustainable palm oil criteria.

WWF said it was “disappointed”, while environmental group Friends of the Earth condemned RSPO for its reliance on voluntary measures and domination by palm oil producers. Friends of the Earth’s respected Indonesian branch, known by the Bahasa Indonesia acronym WAHLI, did not attend last week’s ICOPE meeting, organized by Sinar Mas, WWF and CIRAD, the French government’s tropical agriculture research institute.

Into the greenwash
Greenpeace has criticized RSPO as a “greenwash” mechanism, but it sent representatives to Bali for ICOPE. “It was a professional conference,” Greenpeace forest campaigner for Southeast Asia Joko Arif said. Under the theme “measurement and mitigation of environmental impact of palm oil production”, ICOPE brought together researchers from Europe, Asia, Africa and Latin America.

“We’re still working with the industry to make palm oil sustainable,” Arif said. “ICOPE is a good way to start. Talking about palm oil and biodiversity has not been done in Indonesia. The industry has in the past denied palm oil has links to deforestation.” Arif was impressed with promising scenarios presented at ICOPE for integrating palm and pulp plantings with orangutan habitats, adding that the real importance of the conference is “what happens next”.

To a great extent, the next steps in Indonesia are up to the government. At ICOPE, Indonesia’s Agriculture Minister Suswono welcomed conversion of peat land to palm oil production, while Environment Minister Gusti Muhammad Hatta said that peat lands should not be converted to plantations. “What we heard was a confusing picture for the industry,” Arif said. “The industry needs clear signals from the government.”

While a handful of producers are receptive to producing sustainable palm oil, Arif urged Indonesia’s government to take the lead. Otherwise, he cautioned, Indonesian producers may be left behind as consumer companies establish their own standards: “We have to lobby the government with the industry to do what the market demands.”

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