Sustainable palm oil. By what definition for Indonesia?
Indonesia signed a trade deal with EFTA countries - Switzerland, Liechtenstein, Norway and Iceland in December 2018.
Heralded as a beachhead into the main EU market, palm oil which had been the sticky point in these negotiations looks like it will enjoy continued market access but this comes with terms and conditions. Specifically, Switzerland will allow its entry as long as its local rapeseed industry is protected but surprisingly enough, considering the hard line Norway has on palm oil, is market access to its aquafeed needs to support its massive fisheries program.
Heralded as a beachhead into the main EU market, palm oil which had been the sticky point in these negotiations looks like it will enjoy continued market access but this comes with terms and conditions. Specifically, Switzerland will allow its entry as long as its local rapeseed industry is protected but surprisingly enough, considering the hard line Norway has on palm oil, is market access to its aquafeed needs to support its massive fisheries program.
The Norwegian need for aquafeed is a controversial issue that involves importing massive quantities of soy protein concentrate from Brazil which has been associated with deforestation in the Amazon. By opening up the aquafeed market to Indonesian palm oil, is it substituting one “deforestation” product for another? Or is this a quiet admission that Indonesian palm oil is more sustainable than soy from Brazil?
Sustainable palm oil?
The oversupply of vegetable oils globally in 2019 answers the food versus fuel question which had warned of global hunger should vegetable oils be used for energy. This leaves the issue of deforestation as the biggest hurdle for the palm oil industry to overcome.
As THE issue which dominates the present arguments on palm oil in biofuels, it is possible that other developments in trade will have a greater influence on a global definition of sustainable palm oil.
The MoU signed between Indonesian and Indian solvent extractors in late 2018 could well bring about the biggest change in the sustainability of Indonesian palm oil. However, any definition of “sustainable palm oil” they come up with could be challenged by Indian oilseeds farmers whose crops cannot compete with the high yields of the oil palm.
The same goes with the current trade negotiations between Malaysia and Indonesia and the EU.
A joint statement from the 22nd EU-ASEAN Ministerial Meeting has highlighted the arguments on the proposed ban on palm oil based biofuels by 2030.
While the EU continues to flag deforestation as the reason to eliminate palm oil from its biofuels policies, the Malaysian and Indonesian governments have argued that palm oil is a necessary part of the countries goals to meet the United Nations Sustainable Development Goals (SDGs)
The most significant development for the arguments on palm oil in biofuels was reported by Bloomberg in January 2019. Colombia appears to be winning the argument that its palm oil production does not include deforestation and looks like it may qualify as a “low risk” supply.
This will create an opportunity for Malaysia to argue that its palm oil should also qualify as “low risk” since there is an abundance of no deforestation palm oil as shown by geo-economist, Khor Yu Leng. The on-going certification of the palm oil industry under the national program Malaysian Sustainable Palm Oil (MSPO) will further underline the quality of Malaysian palm oil but where does that leave Indonesia, the source of most of the controversies on deforestation and orangutan extinctions?
Allowed deforestation for sustainable development
Development overall in Indonesia is some twenty years behind that of its Southeast Asian neighbours. This explains why it is so well forested compared to India or Thailand. Its greatest challenge to sustainable development is its large population which is unequally distributed across the country. The policy of Transmigrasi which involves moving people from heavily populated provinces like Java to less populated ones including Kalimantan is a source of tension for the indigenous Dayaks but there aren’t a lot of options for the Indonesian government.
As the country tries to include all her citizens in development, leaving no one behind being part of SDGs, the poorest provinces including Papua, West Papua, Maluku and East Nusa Tenggara are seeing high rates of deforestation as key industries including timber and palm oil are used to fund development.
It is obvious that Indonesia will include deforestation in any definition of sustainability but it is equally obvious that there can be no justifiable demand for it to keep every stick of forest in its domain. The fight against climate change may require the help of Indonesian forests but no one should expect that any of its people remain poor as an offset to lifestyles of the consumers in developed countries.
As it stands, sustainability or sustainable palm oil is not being defined by the masses of poor people who are living it but by the very vocal voices of the few whose livelihoods depend on other industries that would never qualify as sustainable.
In order for Indonesia to make a convincing case of the sustainability of its palm oil, transparency is a must. Much of the industry’s activities remains tainted with accusations of corruption and unregulated growth despite the present governments efforts to remove those. The Indonesian Sustainable Palm Oil (ISPO) scheme could be a good vehicle to show sustainability of the palm oil industry if it was more aggressive and transparent about certification. What would really help the Indonesian case is to present the whole story on its development agenda where palm oil is only one factor. As this detailed study from Duke University found,
"From 2014 to 2016, an average of more than 800,000 hectares of primary forest was lost annually, but large-scale plantations accounted for only 25 percent of it"
Published February 2019. CSPO Watch
Sustainable palm oil?
The oversupply of vegetable oils globally in 2019 answers the food versus fuel question which had warned of global hunger should vegetable oils be used for energy. This leaves the issue of deforestation as the biggest hurdle for the palm oil industry to overcome.
As THE issue which dominates the present arguments on palm oil in biofuels, it is possible that other developments in trade will have a greater influence on a global definition of sustainable palm oil.
The MoU signed between Indonesian and Indian solvent extractors in late 2018 could well bring about the biggest change in the sustainability of Indonesian palm oil. However, any definition of “sustainable palm oil” they come up with could be challenged by Indian oilseeds farmers whose crops cannot compete with the high yields of the oil palm.
The same goes with the current trade negotiations between Malaysia and Indonesia and the EU.
A joint statement from the 22nd EU-ASEAN Ministerial Meeting has highlighted the arguments on the proposed ban on palm oil based biofuels by 2030.
While the EU continues to flag deforestation as the reason to eliminate palm oil from its biofuels policies, the Malaysian and Indonesian governments have argued that palm oil is a necessary part of the countries goals to meet the United Nations Sustainable Development Goals (SDGs)
The most significant development for the arguments on palm oil in biofuels was reported by Bloomberg in January 2019. Colombia appears to be winning the argument that its palm oil production does not include deforestation and looks like it may qualify as a “low risk” supply.
This will create an opportunity for Malaysia to argue that its palm oil should also qualify as “low risk” since there is an abundance of no deforestation palm oil as shown by geo-economist, Khor Yu Leng. The on-going certification of the palm oil industry under the national program Malaysian Sustainable Palm Oil (MSPO) will further underline the quality of Malaysian palm oil but where does that leave Indonesia, the source of most of the controversies on deforestation and orangutan extinctions?
Allowed deforestation for sustainable development
Development overall in Indonesia is some twenty years behind that of its Southeast Asian neighbours. This explains why it is so well forested compared to India or Thailand. Its greatest challenge to sustainable development is its large population which is unequally distributed across the country. The policy of Transmigrasi which involves moving people from heavily populated provinces like Java to less populated ones including Kalimantan is a source of tension for the indigenous Dayaks but there aren’t a lot of options for the Indonesian government.
As the country tries to include all her citizens in development, leaving no one behind being part of SDGs, the poorest provinces including Papua, West Papua, Maluku and East Nusa Tenggara are seeing high rates of deforestation as key industries including timber and palm oil are used to fund development.
It is obvious that Indonesia will include deforestation in any definition of sustainability but it is equally obvious that there can be no justifiable demand for it to keep every stick of forest in its domain. The fight against climate change may require the help of Indonesian forests but no one should expect that any of its people remain poor as an offset to lifestyles of the consumers in developed countries.
As it stands, sustainability or sustainable palm oil is not being defined by the masses of poor people who are living it but by the very vocal voices of the few whose livelihoods depend on other industries that would never qualify as sustainable.
In order for Indonesia to make a convincing case of the sustainability of its palm oil, transparency is a must. Much of the industry’s activities remains tainted with accusations of corruption and unregulated growth despite the present governments efforts to remove those. The Indonesian Sustainable Palm Oil (ISPO) scheme could be a good vehicle to show sustainability of the palm oil industry if it was more aggressive and transparent about certification. What would really help the Indonesian case is to present the whole story on its development agenda where palm oil is only one factor. As this detailed study from Duke University found,
"From 2014 to 2016, an average of more than 800,000 hectares of primary forest was lost annually, but large-scale plantations accounted for only 25 percent of it"
Published February 2019. CSPO Watch