The problem with palm oil


Inodnesia has one of the highest tropical forest loss rates in the world with 74 million hectares of forest destroyed in the past 50 years. The lucrative hardwood trade; a lack of effective conservation laws; and endemic corruption have left the forests at the mercy of loggers, and the looming ecological disaster is well documented. But sadly Indonesia’s forests now face the biggest threat of all, an insatiable global demand for palm oil.

These days the roar of chainsaws is often followed by raging fires as the land is cleared and the ancient forests, home to some of the earth’s greatest biodiversity are replace by orderly rows of oil palms, standing like rows of soldiers. The battle lines have been drawn and hectare by hectare the forest is being claimed. Sound overdramatic? If only it was, but the facts paint a sad picture. In the 1980’s about one million hectares of forest were cleared annually, now it’s over two million and much of the land that has been deforested in the last 20 years is due to the planting of oil palms. Over half of the forest cover in Sumatra and Borneo has now been destroyed and along with the forest and the species that inhabit it, an ancient way of life is disappearing. There are also global ramifications for us all, in terms of the air we breathe, as these forests provide nature’s filtration system, storing toxic carbon dioxide and releasing life-giving oxygen.

the nut of an oil palm 

What is palm oil 

Palm oil is produced from the fruit of the oil palm and has been heralded as a wonder product. It is the most productive oil crop in the world, low in saturated fats, cheap to produce and highly versatile. It is found in cooking oil, confectionary, margarine, cakes, biscuits and snacks. As well as cosmetics, pharmaceuticals, household and industrial items and bio fuel.

Growing palm oil is a lucrative business and the price of crude palm oil has risen steadily, with demand expected to triple by the year 2050. Ninety per cent of the world’s palm oil exports come from the plantations of Malaysia and Indonesia. Palm oil in itself is not a bad thing, the problem lies in the degradation of primary forests in order to produce it. An estimated fifty million hectares of degraded land lays wasted in Indonesia, but palm oil companies prefer to use forest land where they can also make a profit from the timber they cut down.

The Quest for Green Gold
The biggest irony is the increasing use of palm oil for bio fuel, a supposedly ‘green’ fuel, proclaimed to be a low carbon solution to climate change. This quest for green fuel is actually causing more damage to the climate than the fossil fuels it was designed to replace. Once the useable wood has been removed, fires are often used to clear the land and peat bogs are drained to plant oil palms, a process which releases hundreds of millions of tones of carbon dioxide into the atmosphere making Indonesia the third highest contributor to CO 2 emissions in the world.

Greenpeace claims that more carbon emissions result from deforestation and peat fires than are produced by the entire global transport sector. Currently, over seven million hectares in Sumatra are utilized as oil palm plantations, and the plan is to extend this by a further 20 million hectares, in order to meet EU targets of ten percent of all transport fuel to come from crops by 2020.

Human Rights
While fortunes have been made from palm oil, it is a mistaken assumption that everyone involved in the process is getting rich. Plantation companies claim that that they create employment, especially in rural areas which in turn leads to economic development. Impoverished land owners often see few financial alternatives and many give up their land to become small stake-holders or to work on the plantations. But the social costs are high. Traditional communities have lived in the forests for generations, hunting bush meat, eating fruits and seeds, harvesting traditional medicine and planting subsistence crops. They were often poor but led a naturally sustainable way of life. Now they find themselves at the mercy of market forces and tied to a 25 year cycle on a single crop. Those who have retained small holdings can eke out a living as long as the boom continues, but those who have sold their land and now work for a minimum wage are often worse off as they have to pay for imported goods. Conflict is inevitable, and according to Sawit Watch, a local environmental organization, more than 500 cases of conflict have been reported.

The Environment
Although illegal, the fires that are set to clear the land and can quickly burn out of control. The devastating fires of 1997 burned five million hectares of Indonesia’s forests and of the 176 companies accused by the Indonesian government of starting fires, 133 were oil palm plantations companies. The battle between big business and the environment is not new, and all too often the environment is the loser.

Pollution problems are also caused by effluent from the milling process and the intensive use of pesticides and herbicides in the plantations, creating toxic run- off which poisons the land and the water system. The low land forests of Borneo and Sumatra – the last remaining habitat for orangutans and a number of other species are the areas favoured for conversion and all unprotected areas are at risk. The fires of 1997 decimated one third of Borneo’s orangutan population; while the Sumatran orangutan population has decreased by half in the last twenty years and the estimated remaining 6500 animals have been classified as critically endangered. These endearing creatures make great ambassadors for Indonesia’s forests, and their plight has captured hearts around the world, but the orangutan is just the tip of the iceberg. They are known as a cornerstone species and play an important part in forest regeneration through the seeds and fruits they eat. If they become extinct there will be a knock-on effect on many other species


Palm oil factory near Bukit Lewang

A Glimmer of Hope

If palm oil could be planted without decimating the remaining forests, a potential ecological disaster could be averted, and there are signs that some companies are willing to explore this option. RSPO (Roundtable on Sustainable Palm Oil,) was set up in 2004 and is a not-for-profit association formed of companies and groups involved in palm oil production. Its mission is to promote the growth and use of sustainable palm oil. Forty percent of palm oil companies have joined RSPO, as well as banks, NGO’s and high profile companies such as Unilever, Body Shop and Cadbury. Last year the first batches of certified sustainable oil were shipped to Europe and now account for 3% of CPO. It’s a step in the right direction, but there is still along way to go. Sustainable plantations do not produce much at the moment, and the global demand for palm oil continues to grow.

There is also “Project POTICO” (Palm Oil, Timber, Carbon Offsets,) a partnership between WRI (World Resources Institute,) an American think tank, and NewPage Corporation. This initiative was set up earlier this year and slated to combat illegal logging, reduce greenhouse emissions and preserve virgin rainforests in Indonesia by diverting new oil palm plantations to degraded land. Over one million hectares of wasted land is marked for conversion under the three year program.

There are also indications that things are changing at a local level, In Aceh, Sumatra, officials recently gave 100 hectares of fallow agricultural land to 59 households in the village of Lami so they could grow oil palm without cutting down rain forests. The Indonesian environmental group YEL is overseeing the organic cultivation. Also in Aceh, the tiny and remote village of Tangkahan is another prime example of grass roots conservation where the community rejected the lure of palm oil and decided instead to set up eco-tourism. Elephants are used to patrol the jungle searching for illegal loggers, and small guesthouses provide the quintessential jungle experience. It was while staying in this hidden and untouched paradise that my interest in palm oil was ignited. Each evening I would eat with the local guides and the conversation always turned to palm oil. They hope to lead others by example and show that there are alternatives. “One step at a time,” Jungle Bob tells me, “we can’t do much, but at least we can do something.”

Within Indonesia the key lies in education and SOS (Sumatran Orangutan Society) runs a number of programs to this end. Their aim is to empower the next generation of Indonesian conservationists, and programs include: touring educational road shows: the development of a conservation curriculum for schools in North Sumatra: community forestry schemes to reinforce national park buffer zones and provide sustainable alternative incomes for people living adjacent to natural orangutan habitat; and a tree planting program that has seen the planting of over a quarter of a million indigenous tree seedlings to date.

Responsibility lies with the Indonesian Government and companies, but also with us because as end consumers we have the right to choose. It is fashionable in Australia and Europe to call for boycotts of palm oil, but this won’t solve anything, a cheap and versatile vegetable oil is necessary, and other alternatives such as corn and soya bean oil pose similar problems.
Conservationists call for labeling of products and claim that consumers have the right to choose to buy from sustainable plantations, much as they have the right to buy fair trade products or items that have not been genetically modified. Consumer pressure and preference might lead companies into using sustainable oil. Greenpeace, SOS and Rainforest Action Network urge people to talk about palm oil in order to get the issues known. You can also sign online petitions, make financial contributions to their campaigns, and write to supermarkets to tell them you want sustainable palm oil. It might not seem like much, but as consumers we do have power and doing something is always better than doing nothing. If you want to get involved, or to learn more, have a look at the websites listed below.



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