Deforestation is a hot topic. Feeding into conversations on climate change and biodiversity loss, deforestation is responsible for the drastic reduction of primary forest coverage – down 80m hectares – over the last 30 years.
Palm oil production is a major contributor. The FAO estimates the commodity, which is the most consumed vegetable oil in the world, has contributed to 5% of tropical deforestation in tropical areas.
And the European Commission pins palm oil production to 2.3% of global deforestation.
However, thanks to local government initiatives and corporate actions, such as No Deforestation, No Peat and No Exploitation (NDPE) commitments, statistics are changing.
With deforestation still a global concern, is there too much focus on the palm oil sector?
‘Timber has not had the same level of attention as palm oil’
At a recent webinar hosted by the Innovation Forum, experts stressed attention should be broadened beyond palm oil.
“We’ve observed many trends over the years, one of the key ones is that deforestation for oil palm plantation development has decreased,” said Chris Wiggs, programme director at Dutch non-profit Aidenvironment.
Indeed, in WWF’s 2021 report on deforestation, a slowing trend for deforestation linked to palm oil in Indonesia and Malaysia was identified.
Aidenvironment, which works to increase the sustainability performance of companies operating in agricultural and forestry sectors, has observed deforestation in other commodities, such as timber.
“There is a lot of deforestation for timber, and timber has not had the same level of attention as palm oil [in recent years],” Wiggs explained. “The discourse around deforestation in Indonesia and Malaysia has largely been linked to oil palm plantation development.”
‘We have to focus where the actual deforestation is occurring’
Proforest, too, believes attention has too heavily focused on the palm oil sector. “We need to end forest loss and loss of natural ecosystems. We need to stop focusing just on oil palm and look across both current and future deforestation drivers,” Proforest co-founder and director Ruth Nussbaum told delegates at the event.
The non-profit organisation, which supports the practical implementation of commitments to responsible sourcing and production of commodities, believes there are two key reasons for this.
Firstly, there has been ‘real progress’ made by the palm oil sector to curb deforestation. “We need to recognise and reward progress so that people in the sector see that making those changes has a positive impact.”
And secondly, the ‘actual problem’ needs to be addressed, she continued: “And that doesn’t exclude palm. There is still more work to do, but we have to focus where the actual deforestation and conversion is happening.”
Perhaps unsurprisingly, Mark Wong, head of downstream sustainability at the world’s largest producer of certified sustainable palm oil, Sime Darby Plantation, agrees.
“Is there too much focus on palm oil? As a palm oil company, you’d probably expect me to say yes,” he told delegates. “It’s nice to hear everyone else also echoing points around why we know enough now to try and broaden where the focus should be and how we should be looking at other things.”
Sime Darby Plantation has been working on NDPE commitments in its supply chains ‘for a while now’. “We’ve got enough insights to understand now that actually there are other [commodities] out there which are driving deforestation.”
Overlap identified between timber and palm oil concessions
While deforestation in palm oil is technically decreasing, some companies associated with multiple commodities, including palm oil, are not as committed to ‘no deforestation’ as their claims may suggest.
Amongst the trends identified by Aidenvironment, which monitors land-use change in Indonesia, Malaysia, and Papua New Guinea, is that deforestation is occurring on other commodity concessions. “We pick up deforestation and it’s on other concessions than palm, typically timber concessions. And it’s quite a lot of deforestation,” we were told.
In 2020, Aidenvironment attributed 13,000 hectares to five companies alone in Indonesia for industrial trees – notably for the production of pulp, paper, plywood, and rubber.
“What you see a lot is that there is a big overlap between the companies operating timber concessions and palm oil concessions.”
The non-for-profit estimates about 64% of timber concessions are owned by companies that also operate palm oil concessions. Often the deforestation occurs on concessions that are owned by companies supplying palm oil to supply chains covered by no deforestation policies.
A 2021 Aidenvironment analysis of 10 companies in Indonesia and Malaysia that operate both oil palm and timber concessions, and sell to palm oil buyers with ‘no deforestation’ policies, revealed 133,000 hectares of deforestation occurred between 2016 and 2021 for timber.
“When we raised this with palm oil buyers, which we’ve been doing for a number of years because it comes up quite often, they will almost always say that they apply their NPDE policies only to oil palm, as a ‘commodity specific’ application of the policies.”
Understandably, this has raised a number of issues. If a palm oil buyer claims it has a ‘no deforestation’ policy, yet sources from a palm oil producer that clears forest for timber production, how authentic is its ‘no deforestation’ claim?
And is there a solution? Aidenvironmen’s Wiggs sees one in expanding no deforestation claims to all commodities. “We’ve been advocating for the palm oil sector to expand the scope of its policies to include all deforestation that their suppliers might be implicated in, not just deforestation for oil palm.”
