IGPN - International Green Purchasing Network

January 26, 2015

World's largest palm oil trader commits to zero deforestation

Oliver Balch
Monday 26 January 2015 07.00 GMT

Let’s start with some good news. Wilmar International, the largest palm oil trader in the world, recently committed not to engage in deforestation. A year on from announcing the policy, the Singapore-based agribusiness was lauded in a report on deforestation-free supply chains (pdf) by the pro-transparency organisation CDP.

On the face of it, the praise appears merited. Wilmar’s new policy (which also includes a ban on developing palm on peat areas) stands to save more than 1.5 gigatonnes of carbon dioxide by 2020 – equivalent to the combined annual energy-related carbon emissions of Central and South America.

That’s all supposing the company can deliver, of course. So can it?

On its wholly owned, directly managed palm plantations, meeting its pledge should be straightforward. The real challenge arises with the franchised or independent smallholder farmers from whom Wilmar buys around one third of its raw supply.

Often farming in remote areas and with little regulatory oversight, smallholders are far more likely to engage in “slash-and-burn” forest clearance, excessive chemical use and other environmentally unsustainable agricultural practices. “Smallholders lack capacity [and] they are people who often don’t have choice,” says Simon Siburat, Wilmar’s group sustainability controller. “And they don’t really see the need to be certified,” he says.

It’s not just a problem for Wilmar. An estimated two-fifths of the world’s palm oil derives from plantations of fewer than 50 hectares, the general marker for a smallholding. Without the engagement of these farmers, palm oil will never be able to shake off its reputation as environmentally destructive.

Read more at The Guardian.

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