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RSPO members questioned over sustainability of palm oil production

28 April 2013

GreenPalm, “a certificate trading body… designed to tackle the environmental and social problems created by the production of palm oil”, has published an assessment made by the World Wide Fund for Nature (WWF) of the progress made by palm oil producers certified by the Roundable on Sustainable Palm Oil (RSPO) towards 100% sustainability of their palm oil production. The review, based on “data submitted to the RSPO via the 2012 annual communication of progress (ACOP) reports”, found that:

  • of the 92 members of the RSPO, only 70% submitted a communication of progress report in 2012;
  • only 54 members “disclosed the extent of estates that they manage” (3.8 million hectares), an essential basis for determining progress towards 100% sustainable certification of their operations;
  • “32 growers reported that they had some certified estates”, amounting to 37% of their total reported area;
  • of the 53 growers reporting on the volume of crude palm oil produced, only 38% of the volume was certified as sustainably produced;
  • only 54% of RSPO members “had set themselves any sort of time-bound plan for certification of their estate land”, with only 36% of members setting 2015 or sooner as a target date;
  • “only 29 out of the 92 companies have time-bound plans for certifying their associated smallholders that have a long-term contractual relationship to supply fresh fruit bunches (FFB) to their mills.”

WWF concluded that only “a handful” of RSPO members were “making adequate progress on the road to 100% RSPO compliance”, with the majority of members needing to “move much faster if the RSPO is to reach its goal of transforming the palm oil sector toward 100% sustainability”. According to the RSPO web site, only 15% of oil palm is RSPO-certified.

The WWF assessment needs to be seen against a background of growing criticism over the impact of palm oil production on tropical rainforests. According to a report on the website EurActiv.com, Greenpeace maintains that new EC proposals for review of the indirect land use change (ILUC) provisions of the renewable energy directive (RED) have failed to follow through on the findings of independent assessments of the impact of patterns of palm oil production on tropical rainforests. Greenpeace maintained that the EC’s proposals of October 2012 had acknowledged that “palm oil was one of the worst biofuel sources in terms of indirect land use change”. The EC’s current review of criteria was intended to address criticisms of the science behind the existing provisions of the RED. According to Greenpeace, the EC is now arguing that “the current available scientific modelling on ILUC was not robust enough for the Commission to factor it into the regulatory proposal”, and is now opting for “other sustainability criteria for biomass”.

According to the EurActiv report, Greenpeace maintains that the EC’s own analysis acknowledged that “extra demand for food crops such as palm oil for the production of biofuels can have a significant impact on climate change.” In voicing criticisms of the EC approach to ensuring the sustainability of renewable energies developed with EU policy support, Greenpeace has also questioned “the validity of the RSPO in checking that the sources of palm oil met sustainability criteria”.

RSPO has asserted in a statement that “certified sustainable palm oil… does not contribute to the sustained destruction of valuable tropical rainforests”.

Editorial comment

The main sustainability-certified palm oil producer in the ACP is New Britain Palm Oil Ltd (NBPOL) of Papua New Guinea, which is in the top 20% of companies in terms of the area of land on which certified sustainable palm oil production takes place. Over three-quarters of NBPOL production takes place on sustainability-certified land. This assists NBPOL in positioning itself on European markets, where it sells primarily to food manufacturers.

In terms of new palm oil projects being launched in Africa, there would appear to be a need to ensure that the new production meets sustainability criteria, given the growing demand for sustainably produced palm oil on the EU market. It is unclear whether this is in fact the case.

However, investments in ensuring sustainable production and certification of palm oil could yield little or no benefit if the integrity of the certification system is brought into question. This could also undermine the market positioning strategies adopted by established companies such as NBPOL.

Similarly, if weak regulatory requirements on sustainability requirements are introduced, this will undermine the commercial advantages to be gained by companies genuinely committed to sustainable forms of palm oil production.

Strengthening regulatory requirements, including for labelling, would appear to be necessary if new ACP producers are to gain the benefits of investments in sustainable forms of palm oil production.

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