The Roundtable on Sustainable Palm Oil (RSPO), a body that has devised certification criteria to improve the social and environmental performance of palm oil, opens its annual meeting tomorrow in Jakarta.
High on the agenda for the meeting are several contentious issues, including the RSPO’s handling of complaints against non-compliant members, stricter financing rules proposed by the World Bank for palm oil producers, and accounting of greenhouse gas emissions from palm oil production. Palm oil marketing bodies tend to maintain theirs is a low-carbon product, but environmentalists say growers often fail to account for emissions resulting from initial conversion of forest or peatlands to oil palm plantations. A consensus on carbon accounting is unlikely to form at the meeting, but some participants are expected to highlight their own voluntary accounting mechanisms as potential paths forward for the industry.
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The involvement of smallholders in the RSPO will take center stage in the meeting. Smallholders control a significant proportion of the oil palm estate, but their plantations tend to underperform big holdings by most measures, including environmental protection and yield, due to poor practices and substandard genetic material of their palm trees. Smallholders often lack the capacity, knowledge, and funds to get their holdings certified under RSPO, and therefore the body is considering a fund that would subsidize the cost of auditing. RSPO may also evaluate measures to help improve smallholder yields to the level seen on private and government-run plantations, a push which could provide a significant boost palm oil production, especially in Indonesia, without the need to expand the extent of plantations.
According to Reuters, RSPO-certified palm oil has accounted for more than seven percent of 45 million metric tons in global annual output since the first shipments left port two years ago. Demand for certified sustainable palm oil (CSPO) is now roughly meeting supply, according to data from the RSPO.
Palm oil
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Global palm oil consumption stands at nearly 50 million tons per year, about half of which is traded internationally. It is used widely in processed foods, cosmetics, and soaps — WWF estimates that palm oil is found in roughly half of packaged supermarket products. It is also increasingly used as a biofuel.
But while palm oil is a highly efficient crop, surging production over the past 20 years has spurred strong backlash from environmentalists who note its expansion has consumed vast areas of rainforest in Malaysia and Indonesia, triggering substantial greenhouse gas emissions and putting endangered wildlife—including orangutans, pygmy elephants, Sumatran rhinos and tigers—at risk. Oil palm plantation development has also exacerbated social conflict in some areas.
 Oil palm plantation and logged natural forest, Sabah, Malaysia. Photo: R. Butler/mongabay.com |
The RSPO emerged as a response to these concerns. The body—which includes industry stakeholders as well as environmentalists and other groups—sets sustainability criteria for palm oil production. Nevertheless the initiative has been battered over the past year with revelations that some members have continued to destroy ecologically sensitive habitats. Prominent members, including Unilever and Nestle, have had to act outside the RSPO process to address misconduct by RSPO-member suppliers. Some critics say the scheme lacks oversight, sets a low bar for compliance, and is underfunded. Supporters argue that RSPO is still a relatively new initiative that needs more time to prove itself. The RSPO recently censured a member—PT SMART—which had failed to comply with the body’s rules. SMART, which has lost a number of major clients including Unilever, Kraft, Burger King, and Nestle, is now working to clean up its operations.
Indonesia and Malaysia account for nearly 90 percent of palm oil production.
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