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  • Archive for May, 2016

    Widodo plans to freeze palm oil plantation permits

    2016 - 05.18

    Indonesian president Joki Widodo has announced plans to ban new oil palm and mining permits in an attempt to cut back on deforestation levels in the country's rainforests.

    Indonesia, which is one of the world's top palm oil producers, produced approximately 30.9 million tonnes of palm oil in 2015, according to the country's agriculture minister. However, rapid expansion of palm oil plantations, coupled with increasing amounts of deforestation, has caused the president to ban future permits until the issue regarding the region's fires and haze has died down.

    The president announced the plans on Thursday as a continuation of the 2011 forestry moratorium. “Current plantations are enough, as long as the seeds are proper, it is possible to increase productivity by two times,” he said when revealing the freeze. The government disclosed that palm oil plantations already covered 11.4 million hectares, and the figure could reach 20 million by 2020.

    Reactions to the freeze have been positive from several NGOs. For example, Maryo Saputra, from Sawit Watch, said: “It is a step forward from the president that we no longer need to expand [palm oil plantations] but should be focusing on increasing productivity. However, we will not just buy [his] words because they should be implemented with action.”

    The Indonesian Palm Oil Association (GAPKI) would not comment on the freeze, but says it was in continual discussions with the government to obtain more detailed information. Tofan Mahdi, a GAPKI spokesperson, said: “What we can say is that palm oil industry is a strategic sector which had contributed $19 billion in 2015, far more than $12 billion from oil and gas sector.

    “President Jokowi has stated that palm oil is a national strategic sector and must be maintained. We will keep monitoring on information related to the president’s statement.”

    As a sustainable forestry company, Greenwood Management welcomes efforts to reduce the impact of deforestation and continued efforts to protect rainforests in Indonesia.

    Agricultural operations could cause severe droughts in Amazon

    2016 - 05.16

    The second largest ecoregion in Brazil is facing increasing deforestation and illegal logging, according to a new study published in the journal Global Change Biology.

    The region of Cerrado, a large Savannah area with extensive forests, has become the focus of increased agricultural land conversions and illegal logging and deforestation, thanks in part to increased laws and activism towards the illegal logging and deforestation activities in the Amazon over the past decade. Deforestation has now decreased rapidly in the Amazonian rainforest thanks to these activists and government regulations, but the focus has now turned to the second largest forest area of Cerrado.

    The study found that the amount of land that had been converted from savannah and forests to agriculture had doubled over the past decade, increasing from 1.3 million hectares in 2003 to 2.5 million hectares in 2013. This could have serious implications on the water cycle in the Cerrado region and arguably the Amazon basin, according to the study.

    During the wet season, crops recycle the same amount as forests and natural vegetation. However, during the dry season, crops retain 60 per cent more. This means that if the agricultural conversion rates continue, this will lead to less rainfall and even a delay to the start of the Brazilian rainy season.

    Lead author Stephanie Spera of Brown University said: “As agriculture expands, it could affect the rainfall regime that supports both natural vegetation and agricultural production — not just in the Cerrado, but also the Amazon.”

    Spera argues in the report that, as half of the rainfall that drops in the Amazonian basin is recycled water from the Cerrado region, the increased agriculture operations could significantly decrease rains in the Amazon, which would lead to more severe and widespread droughts.

    Co-author Jack Mustard added: “This is nearly all rain-fed agriculture in this region. If you start delaying the onset of rainfall, that has implications for what you can grow.”

    Sustainable palm oil companies report higher profits, research finds

    2016 - 05.11

    Sustainable palm oil companies increase their profitabilities; a research paper has suggested.

    'Correlating Economic and Financial Viability with Sustainability for Palm Oil Plantations' by Dr Steffen Preusser has recently published its findings into 34 palm oil companies. It has found that those that have over 40 per cent of their palm oil plantations certified by the Roundtable on Sustainable Palm Oil (RSPO) can sell their palm oil at a significantly higher price.

    The paper also suggests that alongside increasing the profits brought in, ethical certification will also have an impact on profitability by improving its operational indicators. According to a 2012 report by the World Wildlife Fund (WWF), companies that obtain an RSPO certification can in turn experience higher profits and bigger palm oil extraction rates. This is contrary to constant reports that the RSPO brings about further red tape for the industry and that the certification schemes are a burden on palm oil growers.

    The paper, which was commissioned by the RSPO, supports growing evidence that sustainability aids in profitability. In a June 2015 paper, 'Conserving Tropical Biodiversity via Market Forces and Spatial Targeting' researchers from the University of East Anglia found that palm oil companies could set aside up to 16,000 hectares of land out of 32,000 for conservation purposes and still enjoy increased profits compared to businesses that followed no conservation plan at all.

    Preusser commenting on the releasing of the paper said: “ In the study, companies that are RSPO members, but that had not certified any plantations, did not enjoy higher prices. This is despite the fact that their operational data was better than that of non-members.”

    As a sustainable forestry company dedicated to managing forestry assets for the benefit of the environment and the people living and working there, Greenwood Management welcomes sustainable palm oil moves and welcomes the recent findings.

    Unilever, Kellogg's and Mars drop IOI group over suspension

    2016 - 05.09

    Following on from the IOI Group's suspension from the largest association for ethical palm oil production, it has been revealed that IOI Group clients Unilever, Kellogg's and Mars have announced they will be ceasing trading with the group.

    IOI Group was suspended from the Roundtable on Sustainable Palm Oil (RSPO) over complaints at their plantations in Indonesia violating a number of RSPO standards, which were aimed at preventing rainforest destruction.

    Unilever was the first of the clients to drop IOI. In a statement, the company announced it was “disengaging with the company. However separately but in tandem with this process, we are working with IOI and NGOs to try and transform IOI’s business make it sustainable — this is because of the transformational effect this could have on the palm oil industry,” the spokesperson said.

    Kellogg's also said it had begun the process of removing IOI from its chain, because of the complaints and reports it had received regarding its plantations. As of March, 67 per cent of IOI's volume had moved to other suppliers. “We continue to drive industry transformation through our engagement with RSPO, all providers, and palm industry working for groups,” the American multinational said.

    Unilever, Kellogg's and Mars had already pledged to rid their supply chains of destruction, peatland destruction, and rights abuses before the IOI suspension, yet none can currently claim to have traced its palm oil supply back to the plantation level.

    Greenpeace forest campaigner Annisa Rahmawati welcomed the suspension: “Unilever is the first customer to cancel contracts with IOI. Other companies should follow its lead. If IOI wishes to regain its customers, it must take immediate and significant action to address its legacy by restoring and protecting the peatland forests it has destroyed. It must also address the serious social, labour and environmental issues that continue to taint its supply chain.”

    RSPO member suspended over illegal palm oil activities

    2016 - 05.04

    One of Malaysia's largest businesses has been suspended from the world's biggest association for ethical palm oil production, the Roundtable on Sustainable Palm Oil (RSPO).

    The Industrial Oxygen Incorporated (IOI) Group was an original founding member of the association, but has been suspended due to its operations in Indonesian Borneo, where three subsidiaries are reported to have violated a number of RSPO standards that are aimed at preventing the destruction of rainforests.

    The first complaint regarding IOI group was made over six years ago and, during this time, the group has become one of the largest suppliers of 'Certified Sustainable Palm Oil' to consumer giants such as Unilever. Since the suspension, however, the group's ability to sell palm oil has also been suspended.

    A separate IOI subsidiary in Sarawak, Malaysia, has also been accused of land grabbing and uprooting forests without the correct government permits, as well as using unauthorised fire as a method of forest clearing.

    Erick Wakker, from the consultancy firm Aidenvironment, which filed a complaint against IOI, welcomed the decision: “For six years, RSPO allowed IOI to abuse its systems in attempts to sweep serious non-compliance with law and RSPO standards and procedures under the carpet. It was incredibly hard work just to see RSPO fully suspend IOI, based on its own formal rules.

    “The other thing is that IOI needs to give up some land to local communities and work with them as smallholders instead of trying to occupy their land for higher profit.

    "It also needs to accept that consumers will not accept sustainability certificates on products that came from land that ultimately was stolen from ordinary Malaysians and Indonesians."

    As a sustainable forestry company, Greenwood Management welcomes efforts to reduce the impact of unethical palm oil production and continued efforts to protect rainforests.

    Call for international collaboration to prevent illegal deforestation

    2016 - 05.03

    A new US study into how to balance the needs of forests like the Amazon in Brazil with the growing global demand for food has concluded that rules on deforestation need to be harmonised internationally.

    The researchers from Stanford University forecast that 100 million more hectares of farmland will be required by 2030 to grow food for the expanding population. But to stop forests being cleared to provide the land for agriculture, the report said the same regulations must be put in place across international boundaries.

    The team focused its research on the Gran Chaco area, which covers parts of Argentina, Bolivia and Paraguay. The location has lost around 6,000 sq km of forestry a year for the last 10 years and now has a higher deforestation rate than that of the Amazon in Brazil.

    The area also suffers from weak environmental laws, which differ between neighbouring states, and have allowed farm businesses to move in and carry out forest clearances. The report found that although there were strong laws in place to prevent deforestation in Paraguay, there was weak enforcement of the regulations and businesses were able to move in and clear forest areas for cattle ranching and crops.

    Stanford University researcher Yann le Polain de Waroux told the Thomson Reuters Foundation that the answer lay in “harmonising standards among companies working in that region and working to respect the regulations that are already in place”.

    Commitment from large companies will play a big part in achieving these goals. In the US, members of the Consumer Goods Forum including Walmart — which owns Asda in the UK — and Unilever have pledged to work towards zero net deforestation in their supply chains by the end of the decade.

    As a sustainable forestry company dedicated to managing forestry assets for the benefit of the environment and the people living and working there, Greenwood Management supports moves to stop illegal deforestation.