PALM OIL AND SUSTAINABLE PALM OIL FAQ

  • Palm oil is an edible vegetable oil used in many of the products on supermarket shelves. It is used in a wide range of products, from margarine and chocolate to ice cream, soaps, cosmetics, and fuel for cars and power plants. Palm oil is produced from the pulp of the fruits of oil palms which only grow in the tropics. To extract the oil, palm fruits are pressed in palm oil mills. Approximately 85% of the world’s palm oil is produced in Indonesia and Malaysia which are the world’s primary exporters of palm oil. Oil palms are grown on both large-scale plantations and small-scale family farms.
  • Palm oil has many advantages:
    • It is the highest-yielding vegetable oil crop, which makes it very efficient. It needs less than half the land required by other crops (such as sunflower, soybean or rapeseed oil) to produce the same amount of oil. This makes palm oil the least expensive vegetable oil in the world.
    • In most palm oil-producing countries, including Nigeria, Thailand, Colombia, Ecuador, Papua New Guinea, Ivory Coast and Brazil, palm oil trade has the potential to contribute significantly to economic growth and poverty reduction. In Indonesia and Malaysia together, approximately 4.5 million people earn a living from palm oil.
    • Palm oil is a unique ingredient in many products because it has great cooking properties – it maintains its properties even under high temperatures, its smooth and creamy texture and absence of smell make it a perfect ingredient in many recipes and, it has a natural preservative effect which extends the shelf life of food products.
  • In some regions, oil palm cultivation has caused – and continues to cause – deforestation. This means that land which was once predominantly covered by primary forest (forest that has never been touched by man) or which housed protected species and biodiversity, was cleared in order to be converted into palm oil plantations.
    Likewise, some palm oil plantations were developed without consulting local communities over the use of their land. Some have even been responsible for forcibly displacing people from their land. Violations of workers’ rights to fair payment and safe working conditions and other malpractices have also occurred.
  • No, replacing palm oil is not the right solution to address the environmental and social problems associated with oil palm cultivation for 2 reasons:
    •  Replacing palm oil with other types of vegetable oil would mean that much larger amounts of land would need to be used, since palm trees produce 4-10 times more oil than other crops per unit of cultivated land. This would result in serious environmental damage, with the risk that more forests would need to be converted into agricultural land.
    • In producing countries, millions of farmers and their families work in the palm oil sector. Palm oil plays an important role in the reduction of poverty in these areas. Stopping the production of palm oil altogether would create significant problems for these people.
    The best and most sustainable solution is to switch to sustainable palm oil rather than to other vegetable oils.
  • Sustainable palm oil is produced according to a set of environmental and social criteria defined by the Roundtable on Sustainable Palm Oil (RSPO). These 8 principles and 39 practical criteria have been in place since 2008 and define the sustainable production of palm oil. They ensure that fundamental rights of previous land owners, local communities, plantation workers, small farmers and their families are respected and fully taken into account, that no new primary forests or high conservation value areas have been cleared for palm oil production since November 2005, and that mills and plantation owners minimize their environmental footprint. When properly applied, these criteria help to minimize the negative consequences associated with conventional palm oil cultivation.
  • The RSPO Principles and Criteria were drafted through an open and intensive dialogue between oil palm growers, palm oil processors and traders, consumer goods manufacturers, retailers, banks/investors, environmental/nature conservation NGOs and social/developmental NGOs. Also, public consultation rounds were held to gain additional input. The Principles and Criteria were first adopted in 2007 and went through a review process in 2012 involving all stakeholder groups and public consultation. The revised Principles and Criteria were adopted on April 25, 2013.
  • Yes, it certainly does. It is widely assumed that oil palm’s genetic potential will enable further increases in productivity. By applying good agricultural practices, as recommended in the RSPO Principles and Criteria, many growers should be able to significantly increase average yields per hectare. That means that, even without further clearing of primary forests, peat lands or other high conservation value areas, world production of palm oil will be able to see continued growth. Further increasing average yields is crucial in light of the escalating global demand for vegetable oil due to the growing world population and affluence (particularly in India and China). Palm oil remains the most popular choice to meet this demand and the impact of oil palm cultivation can therefore not be underestimated.
  • RSPO’s main priority is to transform existing palm oil plantations and ensure they adopt sustainable practices. Wherever new land is being developed RSPO requires its members to conduct a comprehensive and participatory independent social and environmental impact assessment of the area to ensure the land will be developed in line with the RSPO Principles and Criteria. Land development is essentialto the economic development of a country and land development decisions are taken by national and local governments rather than by the RSPO. Through open dialogue with the industry, local communities, NGOs and the government RSPO aims to ensure new land is developed in a sustainable way.
  • Market transformation will not happen all at once. Different regions in the world have different levels of awareness about sustainability related issues. Whereas Europe is already quite advanced in its efforts to become more sustainable, this process is yet in its initial stages in countries such as India and China. Although the market for palm oil in India and China is about 4 times the size of the European market, Europe plays an important role in driving global market transformation. Europe needs to continue to set the right example for upcoming markets and inspire them to follow suit.
  • The first sustainable oil palm plantations were certified in the summer of 2008. The first shipment of RSPO-certified sustainable palm oil arrived in Europe in November of that same year. At the end of 2012, more than 6.7 million metric tonnes of certified sustainable palm oil had been supplied to the market, and more than 3.5 million of those had been sold under an RSPO scheme. Up-to-date market figures are available on RSPO’s website: http://www.rspo.org/en/key_statistics.
  • At the end of 2012, 52% of the available amount of RSPO-certified sustainable palm oil had been sold under an RSPO scheme. The remaining 48% was sold as conventional palm oil. This gap in supply and demand is caused by logistical challenges – the palm oil supply chain is very complex and buyers and sellers of sustainable palm oil have difficulties finding each other. RSPO aims to address this by developing an online market tool which will facilitate the flow of sustainable palm oil throughout the supply chain.
  • RSPO has developed supplementary requirements to its Principles and Criteria that define the production of sustainable palm oil as a biofuel. The so-called RSPO-RED scheme was recognised by the European Commission in November 2012 as a voluntary biofuels certification scheme under the Renewable Energy Directive. RSPO-RED provides biofuels producers who use RSPO-RED certified sustainable palm oil access to the European sustainable biofuels market in accordance with EU laws.
  • Biofuel only accounts for a very small percentage of the usage of palm oil (only about 5%). There are no signs as yet that the demand for palm oil as a biofuel has significantly increased upon the approval of the RSPO-RED scheme by the European Commission. However, it must be noted in this context that RSPO’s certification systems are limited to the production of palm oil and to its subsequent supply chain. The various ways in which sustainable palm oil can be applied by end-users are not part of the RSPO’s mandate.