P

alm oil is on a lot of people’s minds. In Indonesia, the industry is booming, with US$19.7 billion of crude palm oil exports in 2011.  But expanding oil palm plantations have taken their toll on remaining forests and other natural habitats in tropical regions and led to conflict over land with local people.  

The world’s top scientists are also raising concerns.  According to a recent study in Nature Climate Change, from 1990 to 2010, 90 percent of lands converted to oil palm plantations in Kalimantan were forested.

There need not, however, be a trade-off between palm oil, forests and communities.  It is possible to grow more crops, including oil palm, while keeping forests, and also cutting rural poverty.

In order to do so, companies and investors must lead by supporting sustainable production on land that has already been cleared, while also ensuring that local people benefit and consent to new plantations.  Global markets and the governments of major producer countries should give stronger support to such efforts.

 It was therefore encouraging to see that last week in Singapore, at the Roundtable on Sustainable Palm Oil (RSPO) 10th annual meeting, the UK government and 14 major industry associations pledged to buy only certified sustainable palm oil by 2015.

Big buyers like the British Retail Consortium, Food and Drink Federation, and Seed Crushers and Oil Processors Association have all signed on.

And the US Environmental Protection Agency (EPA) has indicated that emissions associated with deforestation could keep Indonesian palm oil from meeting US renewable biofuel standards.

The RSPO, which manages a voluntary market standard against which production can be certified, requires new plantations to obtain free, prior and informed consent of any affected local communities and avoid loss of biodiversity-rich forests.  

It also excludes plantations that have resulted in recent forest clearing. Major international buyers and traders, such as Walmart, Unilever and Nestlé, as well as mainstream environmental groups like WWF, endorse the approach.

This market-driven strategy helps to bolster efforts by the Indonesian government.

Further government involvement is essential in making the shift to responsible investment more attractive and less burdened by excessive red tape and slow approvals processes, for example when approving “land swaps” that allow companies to exchange prospective plantation sites within forests for already cleared or degraded land nearby.

New research by the global environment and development think tank, the World Resources Institute (WRI), highlights the opportunity that is being missed to expand production onto already-deforested land in order to spare forests.  

WRI has published a method enabling rapid identification of already-deforested land that could be suitable for sustainable oil palm cultivation.  

The method and a suite of online applications launched at the RSPO meeting last week, enable planners, investors and communities to quickly find land where oil palm can be grown without contributing to forest clearing and burning.  

Use of these applications must be combined with field visits and community consultations to ensure local community land and resource rights are respected.

WRI’s tools suggest that more than 14 million hectares of land in Kalimantan may be suitable for sustainable palm oil production. Not all of these hectares should necessarily become plantations; local people may not want particular tracts to go into oil palm.

But the scale of potential is significant. For comparison, experts have predicted a total of 3 to 7 million hectares of oil palm cultivation expansion in all of Indonesia
by 2020.

These numbers suggest that palm oil production targets could be met without clearing another hectare of forest or draining more peatland.

Oil palm is a remarkable crop. It creates much-needed employment and opportunities for smallholder farmers in some of the poorest and most remote rural regions.  

Financial returns for larger investors have also been outstanding and seem likely to remain buoyant as demand grows.  

But in order for Indonesian palm oil to maintain global market access, land use planning to reduce forest clearing and community consent will need to become the norm.  

The resulting expansion in sustainable palm oil production would be a huge boost to the Indonesian economy, and also set an example for the rest of the world of how to grow a nation’s economy while also conserving its forest and reducing poverty.

The writer leads the forests team at the World Resources Institute.