Indonesia challenged by sustainable palm oil demands

Indonesia challenged by sustainable palm oil demands

Adianto P. Simamora ,  The Jakarta Post |  30/08/2008

Indonesia is facing challenges meeting growing demand in the international market for certified palm oil products, as none of the country’s producers have obtained sustainable palm oil certification.

These certificates are issued by the Roundtable on Sustainable Palm Oil (RSPO), a global and multi-stakeholder initiative on developing sustainable palm oil.

RSPO Secretary General Vengeta Rao said it was still in the process of certifying three Indonesian palm oil companies, PT Musi Mas, PT PP London Sumatra Ltd and PT Indole.

“We are still carrying out physical audits of London Sumatra and PT Indole,” he said on the sidelines of an RSPO public forum in Jakarta on Friday.

The Malaysian-based United Plantations Bhd with a concession area of 35.468 hectares is the only palm oil company in Indonesia to have obtained RSPO certification.

Three other Malaysian palm oil firms, Same Darby, PPB Oil Palm and Kulim, have also applied for similar certification.

The RSPO currently consists of 69 members including 39 palm oil companies from Indonesia.

Under the voluntary RSPO certification system, in order to qualify companies must apply eight principles with 39 criteria including environmental responsibility and conservation of natural resources and biodiversity in their operations.

Indonesia produced about 17.4 million tons from its 6.8 million hectares of plantations in 2007, making it the world’s largest palm oil producer.

The sector, which contributed up to US$8 billion to the country’s total exports last year, employed up to three million people.

But Indonesia has received persistent protests from activists and international buyers over its massive palm oil expansion, which they say has destroyed many areas of forest habitat including that of the orangutan.

Greenpeace has strongly urged the Indonesian government to stop forest conversion for palm oil plantations to protect the forest habitats and reduce greenhouse gas emissions.

According to the international environmental group, about 1.8 billion tons of carbon were released into atmosphere from forest degradation and burning peatland in Indonesia, constituting about 4 percent of the total global emissions.

It said Indonesia held a global record for carbon emissions from deforestation, putting it third behind the U.S. and China in terms of total man-made emissions.

The Association of Indonesian Palm Oil Producers (Gapki), which is a member of the RSPO, rejected a call for a forest moratorium, fearing the move would affect the country’s economic growth.

Gapki executive board member Derom Bangun claimed that the association’s 250 member-companies already complied with RSPO criteria in their operations.

WWF Indonesia and Sawit Watch are also parties to the RSPO.

“It is a dilemmatic decision for us to join the RSPO but we are doing it because we want to see improvements in both environmental and social problems in palm oil plantations,” Sawit Watch director Rudy Lumuru said.

Rudy urged the country’s palm oil producers to comply with principles and criteria set out by the RSPO.

The RSPO will convene for its sixth meeting, in Bali in November, to discuss progress in the RSPO certification system and the fate of small farmers in sustainable palm oil production.


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