Solutions & options

Despite the challenges, growing oil palms is not a bad thing in itself. The oil palm has the highest yield of any oil plant – it is also the only crop that yields two different oils that are useful to industry: palm oil and palm kernel oil. Oil palms occupy the smallest proportion of all the land that is used for oil and fat production while at the same time accounting for the largest proportion of worldwide oil production – 32 per cent. Sunflowers, coconut and soybeans all have a yield per hectare that is on average just one-third that of palm oil. Replacing palm oil with other vegetable oils would therefore not have the required effect, but would merely displace the problem and in some cases even make it worse. For example, soybeans and coconut grow in the same sensitive regions or in ecologically similar ones. Growing them would need more land; more greenhouse gas would be produced and more species would be put at risk. And the most important European vegetable oil, rape oil, would not be able to meet the rising global demand for plant-based oils. The high land efficiency of oil palms means that they have an important part to play in meeting the growing global demand for vegetable oils.

How can oil palm cultivation be made more sustainable?

If palm oil production is to be sustainable, it is particularly important that conversion of the land used for plantations does not impact adversely on the environment. Compliance with the principles of good agricultural practice is one of the pillars of sustainable cultivation. To minimise the risk of carbon emissions, oil palms should be grown only on fallow and agriculturally usable land. Ensuring that this is the case is the responsibility of governments in the producer countries, which must address the problem of land use. Producers and consumers throughout the supply chain must also play their part. To enable Europe to pioneer the use of certified palm oil, demand for sustainable palm oil must be increased. This creates incentives for producers to expand sustainable production.

Palm oil production is important to the economies of producer countries. The international trade in palm oil brings them valuable foreign currency. In addition, the non-mechanised harvesting of the palm fruit, which can be performed about 15 times a year, creates large numbers of jobs – many of them in rural and structurally weak regions.

However, it is also important that agricultural workers are paid a minimum wage and that international labour law is observed. It is also essential to involve and support the smallholders who produce the majority of the world’s palm oil, and to prohibit child labour on the plantations.

Certification – an opportunity for the palm oil industry

Oil palms are grown both on large plantations and on small family farms. Achieving the highest possible yield with the minimum detriment to nature is the challenge of sustainable cultivation. In response to international criticism of practices in the palm oil industry, various certification schemes have been set up in recent years. They include the first and most widely used scheme, the Roundtable on Sustainable Palm Oil (RSPO), as well as others such as the Rainforest Alliance, International Sustainability & Carbon Certification (ISCC) and the Roundtable on Sustainable Biomaterials (RSB).

The aim of these schemes is to make oil palm cultivation more sustainable by imposing a variety of standards and criteria, thereby reducing rainforest clearance, slash-and-burn and human rights violations in the palm oil industry. The sustainability criteria set by the certification systems ensure that the basic rights of indigenous landowners, local communities, plantation workers and smallholders and their families are respected and considered. Certification schemes contribute to greater transparency in the value chain and help to strengthen the dialogue on sustainable palm oil.

A further aim is to significantly restrict the use of pesticides by smallholders and plantation owners. In addition, certification schemes specify that no rainforest areas or areas of high conservation value should be cleared to make way for new plantations; mills and farms must reduce their environmental impacts to a minimum. Accompanying measures such as organising training sessions for smallholders, supporting the establishment of organisations and involving governments are another important activity of certification systems in developing and emerging countries.

The weaknesses of certification schemes

Despite the wide-ranging requirements of the various certification schemes in some areas, there are frequently weaknesses in implementation. The various trading options – especially the option to purchase certificates – still fail to give companies sufficient incentive to switch to the more stringent system of segregation. The criteria and indicators relating to certified plantations and mills are often insufficiently strict to meet the objectives and requirements of RSPO, ISCC, RSB or the Rainforest Alliance. Similar problems affect implementation of the complaints procedure in cases in which the criteria are not met. The certification inspections by independent auditors are inconsistent and have some weaknesses.

It is clear that voluntary certification systems alone cannot solve the problems in the palm oil sector, because adherence to the criteria is not required by law. The systems merely guarantee compliance with self-imposed rules on the land for which their voluntary members have responsibility. In addition, certification often entails significant investment and this makes it more difficult for producers – especially smallholders – to uphold their commitment to sustainable palm oil.

Despite the many criticisms levelled at certification schemes, more and more companies in all parts of the world are deciding to acknowledge their responsibility in the global supply chain and to buy only certified palm and palm kernel oil. Certification schemes improve conditions for local communities: in particular, sustainable and certified palm oil production has noticeable benefits for smallholders. Improved methods of growing and harvesting help to improve yields. Because the quality of the palm fruit improves, the palm oil farmers earn more. With its excellent market prospects and high profits per hectare, palm oil therefore presents good earning opportunities in rural areas and hence also for smallholders. Sustainability certification opens up access to the international market, which again increases employment and earning opportunities in the rural regions of producer countries. Certification schemes are therefore an important step towards improved and sustainable practices in the palm oil sector.