State of the Rainforest 2014

Palm oil

Indonesia and Malaysia are the leading suppliers of palm oil, accounting for approximately 85% of the global production of the world’s cheapest edible oil. 9 In addition to being a component in food, palm oil is used in a range of products, including cosmetics, industrial products, animal feed and increasingly in biofuels. 10 The area occupied by oil palm cultivation has expanded by around 43% worldwide over the past 20 years. 11 Today, palm oil represents around one third of global vegetable oil use. 12 High demand in the global market, with India and China as major importers, and high levels of domestic consumption are reasons behind this growth. In 2009, the government of Indonesia announced plans to double its production of palm oil to 40 million tons by 2020. 13 The productionof palmoil comeswithhigh costs. The rapid expansion has destroyed enormous areas of primary and secondary forests, as well as carbon-rich peatlands, and is the key driver of deforestation in Southeast Asia. A surface area of more than 7 million hectares has already been turned into monoculture oil palm plantations in Indonesia. 14 It is estimated that the planned expansion will require an additional area larger than Switzerland. 15 Conversion of forests

to monoculture plantations leads to significant loss of biodiversity, extinction of endangered species and release of greenhouse gases. It also causes numerous conflicts between – companies, governments and local communities, and sometimes even between and within communities. Indonesia’s extensive palm oil production has made it one of the world’s top greenhouse gas emitters. As a response to the past 5–10 years’ massive public criticism of the palm oil industry, several large producers and traders of palm oil (e.g. Wilmar, Golden Agri Resources, Cargill) have recently adopted policies and committed to standards that limit their palm oil use to oil that has been produced without contributing to deforestation, destruction of peat land and human rights’ abuses. The Roundtable on Sustainable Palm Oil (RSPO) was created with 10 members in 2004, and has grown to more than 1500 members in 2014. Still, palm oil certified by the RSPO standards only account for 16% of the global production of palm oil (as of March 2014). 16 It will be important to monitor closely whether the various policy initiatives and the RSPO certification scheme will contribute to reducing the negative impacts of palm oil production, including deforestation.

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STATE OF THE RAINFOREST 2014