Amazon palm oil:
Palm oil industry moves into the Amazon rainforest
Rhett Butler, mongabay.com
July 9, 2008
The agency will partner with Braspalma, a local company, to form Felda Global Ventures Brazil Sdn Bhd. FELDA will have a 70 percent stake in the venture.
"As a start, 20,000ha in Tefe will be opened for oil palm planting. After that, between 3,000ha and 5,000ha will be opened yearly," said Deputy Prime Minister Datuk Seri Najib Razak. "Felda wants to emulate Petronas as a global player," he added, referring to Malaysia's national oil company.
Wednesday's announcement had been expected. Last month Najib said Malaysia would seek to expand its booming palm oil industry overseas. The country is facing land constraints at home.
Accordingly, Felda chairman Tan Sri Mohd Yusof Noor said the agency had been offered 105,000ha in Papua New Guinea, 45,000ha in Aceh on the Indonesian island of Sumatra, and 20,000ha in Kalimantan on the island of Borneo.
Palm oil and the Amazon
Agricultural potential for soy, palm, and sugar cane in the Brazilian Amazon (top). Carbon storage on forest lands suitable for various crops (bottom). Derived from the Woods Hole Research Institute's Readiness For REDD: A Preliminary Global Assessment Of Tropical Forested Land Suitability For Agriculture.
The potential for palm oil plantations in the Brazilian Amazon is vast: the Woods Hole Research Center estimates that 2.283 million square kilometers (881,000 sq miles) of forest land in the region is suitable for oil palm, an area far greater in extent than that which could be converted for soy (390,000 sq km) or sugar cane (1.988 million sq km). Woods Hole calculates this area of forest locks up some 42.5 billion tons (gigatons) of carbon in above-ground biomass, or roughly six times 2006 global emissions. Converting this area for palm would release nearly 60 percent of this carbon (oil palm plantations in SE Asia store about 75 tons of carbon per hectare).
Oil palm expansion in the Amazon will likely be facilitated by infrastructure projects currently underway in these region, including road-building, port expansion, and new hydroelectric projects. Oil palm producers may also benefit from a "logging subsidy" whereby timber harvested from a tract of land helps offset the cost of establishing a plantation. Before the recent run-up in palm oil prices, logging had been a key element to the profitability of oil palm plantations in Southeast Asia.
Palm oil economics
Market prices for crude and vegetable oils from January 2003 through December 2007. Data derived from FAOstat and the World Bank.
Palm oil and biodiversity
Oil palm plantations support significantly lower levels of biodiversity than even logged rainforests. Research by Lian Pin Koh and David Wilcove found a 77 percent decline in forest bird species and an 83 percent loss of butterfly species upon the conversion of old-growth forest to oil palm plantations. By comparison, secondary forest 30 years after logging retained roughly 80 percent of the original forest species. Oil palm plantations also store considerably less carbon than primary forests.
Reducing the impact of oil palm and other forms of agriculture in the Amazon
Oil palm plantations and heavily logged forest near Lahad Datu, Malaysia. Photo by Rhett A. Butler
Better enforcement of existing Brazilian environmental laws -- including requirements to leave a portion of one's land forested and riparian buffer zones -- coupled with Brazil's real-time satellite monitoring of forest cover could further reduce the worst impacts of extensive palm oil cultivation in the Amazon.
Because oil palm plantations offer higher yields on a per hectare basis than either soy or beef production, the establishment of regulations that restrict new development to already cleared lands or secondary forests could result in a net economic gain for the region without the need to clear more forest. In a sense, if the highly productive oil palm plantations replace low-intensity cattle pasture already established in the region (without displacing ranchers or farmers into forest areas), the Amazon may well be richer economically and biologically. An important component to this would be the maintenance riparian zones and migration corridors along with the protection of critical habitats.
Forest cover versus palm oil production in Indonesia. In 2007 Indonesia overtook Malaysia as the world's largest producer of palm oil. Together the two countries account for more than 85 percent of global production.
More data on palm oil production and use
(units = metric tons, 2008 market year)
|Palm Oil Food Use - Domestic Consumption|
|19||Burma, Union of||375|
|Palm Oil Imports|
|15||United Arab Emirates||400|
|16||Burma, Union of||375|
|Palm Oil Exports|
|4||Papua New Guinea||405|
|7||United Arab Emirates||220|
|Palm Oil Industrial - Domestic Consumption|
|17||Congo, Democratic Rep||73|
|20||United Arab Emirates||40|
|Palm Oil Production|
|6||Papua New Guinea||425|
|10||Congo, Democratic Rep||175|
Chart/Graph: Market share of top 5 palm oil producers for the 2008 market year
More news on palm oil (full list of articles)
Malaysia's indigenous people to get land rights for first time
(11/19/2008) Malaysia's government will for the first time grant ownership rights of land farmed by indigenous people, reports the Associated Press, but some may see the legal change as a scheme to promote oil palm expansion.
South Korea to lease half of Madagascar's arable land for corn, oil palm production
(11/19/2008) South Korea's Daewoo has signed a 99-year lease for half of Madagascar's arable land, reports the Financial Times. The agreement covers 1.3 million hectares (3.2 million acres) — an area half the size of Belgium. Daewoo says it plans to plant corn on 1 million hectares in the arid western part of the island and 300,000 ha (740,000 acres) of oil palm on land in the tropical east, a region that is home to the bulk of Madagascar's rare rainforests. The company will produce the food for export and plans to import workers from South Africa, although a Daewoo spokesman said that the project could create up to 70,000 local jobs.
Greenpeace activists block palm oil shipment from departing Indonesia for Europe
(11/11/2008) Greenpeace activists blocked a palm oil shipment from departing Dumai, Indonesia's main palm oil export port, for Europe to protest against the ongoing destruction of Indonesia's forests.
Biodiversity of rainforests should not be compared with oil palm plantations says palm oil council chief
(11/11/2008) Scientists should compare the biodiversity oil palm plantations to other industrial monocultures, not the rainforests they replace, said Dr. Yusof Basiron, CEO of the Malaysian Palm Oil Council (MPOC), in a post on his blog. Basiron's comments are noteworthy because until now he has maintained that oil palm plantations are "planted forests" rather than an industrial crop.
First RSPO-certified ("eco-friendly") palm oil shipment to arrive in Europe
(11/10/2008) The first shipment of palm oil certified under the Roundtable on Sustainable Palm Oil (RSPO) is expected to arrive in Europe Tuesday, but an environmental group is already criticizing the initiative's credentials.