Palm oil paradox

Meeting the demand for the ecofriendly fuel means burning rain forests. A new network offers a better way.

[Editor's note: This story prompted a letter from the Jardine Matheson Group, which owns extensive palm-oil plantations in Indonesia. Excerpts are printed below.]

TRIPA SWAMP, INDONESIA – The surveyor mapping the rain forest below was so shocked that he couldn’t speak. From the air it looked as if someone had bombed with white phosphorus. Plumes of smoke rose from the earth where 150-foot hardwoods lay like toothpicks. Nearby, formations of oil palm plantations advanced, precise as an army.

The shocked surveyor paused to catch his breath. “In a few years there will be nothing left,” he said.

It’s one of the ironies of the sustainability movement. In their push for everything from biofuel to ecofriendly shampoo, humans are killing Earth’s great “lungs” and the habitat of endangered animals.

The reason is palm oil. Companies can’t get enough of the “golden plant” grown in Indonesia and Malaysia to keep up with demand. So plantations are burning and clearing rain forests – often illegally, especially in this peat swamp in Aceh Province – to plant more palm trees.

Clearing the jungle belches carbon into the air and is pushing orangutans to extinction. Conservationists warn that the orange creatures may vanish within a decade or two. Now, a Malaysian-based network of 278 banks, nongovernmental organizations, and companies is pushing to end the destruction by adopting more ecofriendly standards.

It represents a first step in a very long journey for the prized vegetable oil that appears all over supermarket shelves – in detergent, soap, cooking oil, bread, candy bars, cosmetics – and, increasingly, in biofuels.

The push to “green” palm oil “is a work in progress,” says Desi Kusumadewi, the Jakarta, Indonesia, representative of the network, the Roundtable on Sustainable Palm Oil. Since forming in 2004, the RSPO has signed up high-profile multinational corporations such as Unilever, Johnson & Johnson, Nestlé, Colgate-Palmolive, Cargill, The Body Shop, and Cadbury. The maker of Girl Scout Cookies, ABC Bakers, has joined, too. The RSPO certified its first “green” batches a year ago, and now accounts for 1.4 million tons, or 3 percent of the world supply of crude palm oil.

Such fast work is winning kudos.

“The RSPO stands out as a voluntary initiative,” says Catherine Cassagne of the International Finance Corp., the private-sector arm of the World Bank that promotes sustainable projects in poor countries. “There’s nothing comparable.”

RSPO criteria has caught the eye of local producers, too. “Sustainability is the future,” says Muhammad Fuad, who manages the Aceh oil palm operation for Belgian-owned Socfindo Seumanyam.

The company grows the palm on existing plots so that it can leave forests alone. Avoiding consumers’ wrath is worth the extra investment of new equipment and training, he adds.

There are plenty of gaps in enforcement of the new standards, however. Sustainable plantations don’t produce much yet. The global appetite is so voracious that some brands mix “good” palm oil with “bad.” A single chocolate bar, for instance, might contain oil from a compliant plantation and one that’s not.

Furthermore, while RSPO members pledge to embrace environmental criteria, such as zero burning and deforestation, few of them have agreed to go fully sustainable right away. For instance, Unilever, one of the world’s largest buyers of palm oil, made a splash last year with plans to buy only certified palm oil by 2015. What it puts in its margarine until then – it’s the world’s leading margarinemaker – is another matter.

Even more problematic are the RSPO members who haven’t set a fixed date for auditing their subsidiaries. The rules say that if one subsidiary doesn’t abide by the terms, a company’s other units can have their certifications suspended, too. But that only works if they’ve got a time-bound plan for full compliance.

RSPO officials admit that the system is not ideal but say it’s important to get firms on board and then work on details.

A major source of tainted palm on the market is the Astra Agro Lestari plantation here in Tripa, which is linked to the Scottish company Jardine Matheson. Astra refuses to join the RSPO or respect a local moratorium on logging. A recent flight over its concession showed raging fires and acres of peat forest withering from water drainage.

Conservationists take a hard line and say consumers should be able to trace where palm oil comes from, much as they do with Fair Trade coffee. A logo on packaging might help.

“There’s no accountability or transparency,” says Serge Wich, an expert on orangutans with the Great Ape Trust of Iowa. “They could put more pressure to find out the chain of custody and only buy from companies that are responsible.”

He worries about Asia, a major consumer of palm oil. Economic concerns trump environmental ones there. “If most oil goes to China or India, it’s very difficult to determine where it came from,” he says.

Still, Mr. Wich sees signs that the local culture is changing. Ordinary Indonesians who survived the devastating 2004 tsunami understand that degraded forests can spawn more tidal floods, especially in Tripa, whose peatland served as a buffer.

Aceh’s governor is pushing a “green” agenda and some local leaders are following his lead. Recently, officials gave 100 hectares of fallow agricultural land to 59 households in the village of Lami so they could grow palm without cutting down rain forests. The Indonesian environmental group YEL is overseeing the organic cultivation, which stands in contrast to the smoldering woods just down the road.

“Great idea,” enthuses Adnan Nyak Sarung, a senator from Aceh. “The most important thing is to involve the community. They need a sense of ownership over the environment.”

Ms. Kusumadewi of the RSPO concurs, although she worries that more orangutans could die while new plantations encroach on their habitat.

“Time is running out,” she says. “We have to move very quickly.”

[Here are excerpts from a letter from Jardine Matheson Group:

“Jardine Matheson and Astra Agro Lestari (‘AAL’) take environmental stewardship seriously. AAL believes in and strongly supports the preservation and conservation of the natural environment in Indonesia. This is demonstrated by AAL’s sustainable palm oil growing programmes, details of which can be found on its website (www.astra-agro.co.id)."

“AAL also takes seriously its good agricultural practices that apply to all of its farm production and plantation crop processing. It has a strict policy of ‘zero burning’ for land clearance, and to prevent forest fires. AAL also conducts regular fire drills and invests in ongoing community awareness and education. In addition, AAL applies terracing on hilly land at the planting stage to reduce soil erosion; pest control is managed through nontoxic means; and waste products are recycled.”]