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Palm oil production: what are the social and environmental impacts?

Palm Seedlings

Felda Agricultural Services, Malaysia, which produces 25 million germinates palm seeds ever year, enough to cover around 200,000 hectares of new plantations. Photograph: Oliver Balch


Powered by article titled “Palm oil production: what are the social and environmental impacts?” was written by Oliver Balch, for on Thursday 4th July 2013 12.12 UTC

Palm oil boom: palm oil is versatile stuff. An edible vegetable oil, it goes into everything from margarine and soaps to shampoos and fuels.

As the highest-yielding vegetable oil crop, global production is soaring. Total capacity has jumped by 128% over the last decade to 58m tonnes per year.

The vast majority (85%) comes from Malaysia and Indonesia, where the cash crop is held responsible for causing widespread deforestation over the last four decades. Palm oil grows in tropical areas around the equator. Now producers of the cash crop are eyeing up forested areas in the Amazon, Congo and Borneo for new plantations.

Oil Palm Harvesting

RSPO’s producer members commit to preserve moisture, prevent run-off and reduce fertiliser use, among other good agricultural practices. Photograph: Oliver Balch

Responsible production: in 2004, a group of environmental non-profits and palm oil companies joined together to set up the Roundtable for Sustainable Palm Oil (RSPO). The roundtable sets out eight principles, citing 39 criteria, which are designed to prevent the worst aspects of palm oil cultivation: illegal deforestation, chemical pollution, destruction of biodiversity, water loss, poor employment conditions etc. With nearly 1,300 members, it is the largest multi-stakeholder initiative of its kind. Certified sustainable palm oil accounts for 15% of global production – too small at present to offset the sector’s worst impacts.

Oil Palm Nuts

Felda’s palm oil mill No. 21, Jengka district, Malaysia: 16 of Felda’s 71 mills are certified under RSPO. The company has three years to certify the remainder. Photograph: Oliver Balch

Certification: To qualify as sustainably certified, growers must prove to external independent auditors that they are compliant with RSPO’s principles and criteria. At present, 44 of the roundtable’s 123 grower members are certified, corresponding to 2.4m hectares of land – over 90% of which are in Indonesia and Malaysia. Darrel Webber, general secretary of the roundtable, insists that the scheme is changing the industry’s mindset. Initially, palm oil companies bought land and thought only about how many bulldozers they needed to clear it, he says. “Now, ask any CEO, they actually say, ‘Where can I find high conservation value experts … before I send my bulldozers?”

Children Playing

Felda Agricultural Services, based in Malaysia’s Jengka district, provides recreational facilities for its 137 workers and their families. Photograph: Oliver Balch

Economic benefits: Palm oil production is tainted by poor working conditions, lack of health and safety and low wages in many parts of the world. To qualify for roundtable certification, growers must show they issue protective equipment to workers, provide adequate accommodation, pay the minimum wage (around 900 ringgit, or £184, per month in Malaysia) and offer healthcare and other benefits. In Malaysia and Indonesia, the palm oil sector accounts for 590,000 and 3.7 million direct workers respectively.


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