Sustainable Palm Oil Still Difficult to Obtain
Demand is Changing But Production Practices are Not
Aug 9, 2009
The production of palm oil, a highly useful and prevalent component in many fast-moving consumer goods, has many environmental impacts. As demand for this product continues to grow, the production of palm oil has led to massive destruction of vital vegetation and ecosystems, particularly in Southeast Asian states such as Malaysia, Borneo, and Indonesia.
The Issue at a Glance
Tropical regions that produce palm oil often lack substantial, clear land that can be utilized for palm plantations. Thus, palm oil producers frequently resort to slash and burn practices to prepare forested land for use as a plantation. These plantations can range anywhere from 2 hectares to 3,900 hectares of land. As a result, massive quantities of vegetation that is vital to survival of endangered ecosystems, not to mention the maintenance of stable global climate patterns, are being destroyed.
The Roundtable on Sustainable Palm Oil
In response to calls by Greenpeace and other environmental organizations, palm oil producers have launched the Roundtable on Sustainable Palm Oil (RSPO). This roundtable is intended to outline the practices and procedures to sustainably produce palm oil and palm oil byproducts, and issues certificates of sustainability in accordance with these parameters. RSPO requires that a plantation meet several requirements, such as protection of human rights and prevention of soil degradation. Early in 2009, RSPO issued its first certificates denoting several plantations as sustainable palm oil producers. While this certification process is a key step in reducing the negative environmental impacts of palm oil production, there are several caveats that may hinder the efficacy of the program. One such caveat is the saleability of the sustainability certificate between the recipient and non-sustainable palm oil producers.
Trading Sustainability
The sale of the sustainable production certificate works similar to the process of carbon trading. Certificates are issued based on a set number of hectares that are sustainably produced. It is possible for a plantation to have both sustainable and unsustainable practices on the same plantation. A palm oil producer who receives sustainable certification from RSPO is at liberty to sell the certificate to another, non-sustainable producer. The certificate is valid for three years, at which point in time the original recipient may apply for a renewal of the certificate. If sustainable practices have been maintained, another certificate will be issued and this new certificate can once again be sold. The purchaser of the certification is not legally allowed to market their products as sustainably produced, but they are permitted to advertise that they “support the sustainable palm oil production.”
Proponents of the system argue that although the system does not encourage industry-wide sustainable production, that non-sustainable producers have a market incentive to at least buy a certificate, if not adjust their practices to obtain their own certification. Producers that do make the switch to sustainable production reap benefits two-fold according to supporters, in that they achieve better market penetration with large buyers such as Whole Foods (which has vowed to eliminate all non-sustainable palm oil products from its shelves by 2012) and also make money from the sale of their certificate.
However, critics argue that RSPO’s certification program does not create sufficient incentives to encourage enough palm oil producers to change their production practices. At best, it is assumed that the program will only receive only marginal participation from the Southeast Asian producers in the sustainable certification process. Furthermore, the program does not guarantee an equal distribution of sustainable producers since RSPO is primarily concerned with Southeast Asian producers, and consequently some countries may offer better protection for their rainforests than others. Such disproportionate protection can still upset the global ecological balance. Finally, the economic considerations of going sustainable are still fairly ephemeral, as the demand for sustainable palm oil has not yet reached a peak in the commercial market as to force substantial shifts in production practices.
Democracies, Disputes, and Deforestation
The conundrum surrounding the issue of sustainable palm oil is both broad and deep. Governments are often reluctant to impose restrictions on the palm oil industry. The industry is a large contributor to national income and often has a significant lobby or government allies to facilitate continued unsustainable practices. Moreover, the palm oil industry is a large employer in many developing states and a contraction of the industry, or at least a slowed growth rate, may have negative effects on employment figures. Given these factors, until commercial demand for sustainable palm oil captures a significant portion of the market, producers are unlikely to adopt RSPO procedures for sustainable palm oil. In that time, the destruction to rainforests and tropical ecosystems may have reached an irreversible level.
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