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Palm oil

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Oil palm is an efficient agricultural crop. As a result, the area under oil-palm cultivation has more than doubled since the 1990s, with most growth occuring in Malaysia and Indonesia. Although oil palm is a highly profitable crop because yields are high and demand is rising, workers and outgrowers often do not receive a fair share of the revenues.

The effects of plantations are felt in terms of a loss of biodiversity and abrupt changes for local communities. There is huge potential to tackle the environmental and social sustainability problems associated with the expansion of oil-palm cultivation by improving performance in existing plantations and giving smallholder farmers access to international markets for sustainable palm oil.

Palm oil programme: supporting producers and workers

Solidaridad is an active member of the Roundtable on Sustainable Palm Oil (RSPO). The RSPO was formed in 2004 in response to urgent calls for sustainably produced palm oil and unites the palm oil industry, producers and NGOs. Its members have developed and implemented global standards for sustainable palm oil. By June 2011, 4.5 million tonnes of palm oil, or ten per cent of global output, was RSPO certified.

As palm oil is a lucrative crop and smallholders' production practices are not essentially different from large estates, smallholders can compete in domestic and international markets if they are well organized. To help producers improve production practices, the RSPO and Solidaridad established the Palm Oil Producer Support Initiative (POPSI). Implementation of sustainability standards has proven to be a useful tool for promoting good agricultural and social practices and boosting yields. Solidaridad helps oil-palm smallholders and plantations to comply with the RSPO standard. We also support the interests of smallholders through RSPO's Task Force on Smallholders and coordinate efforts with government agencies, international businesses and other NGOs.

Impact: rising productivity and incomes

The Palm Oil Producer Support Initiative aims to reach 16,000 smallholders and 30,000 plantation workers in Central and Latin America, Asia and Africa by 2013. Solidaridad's producer support improves farming techniques and raises productivity in existing planted areas. In turn, this generates higher incomes for smallholders. Sustainable production of palm oil therefore reduces poverty and can reduce pressures on forests with high social, cultural and natural values, or High Conservation Value Areas (HCVAs). It can also curb the greenhouse gas emissions associated with oil palm expansion.

History and prospects of the oil palm programme

Start of the palm oil programme2009Main issueslow productivity of smallholder oil palms, labour conditions, distribution of benefits along the supply chain, social and environmental impacts of new plantationsCountriesBrazil, Colombia, Ghana, Honduras, Indonesia, Malaysia, Papua New GuineaPartnersRSPO, New Britain Palm Oil Ltd, Ghana Oil Palm Development Company (GOPDC ltd.), Agropalma, Daabon, Keresa Plantations, West Africa Fair Fruit (WAFF), Indonesian Oil Palm Research Institute, Tenaganita, Sawit Watch, Solidaritas Perempuan, WWFDonorsNetherlands Ministry of Foreign Affairs (Millenium Agreements), RSPO

Outlook

In the next five years the palm oil programme will focus on:

  • stimulating the demand for sustainable palm oil and derivatives;
  • supporting smallholder and worker participation in setting RSPO standards and in governance;
  • developing supply chain partnerships (buyers, mills, plantations, smallholders) to strenghten farmers' organizations and improve productivity, efficiency and market access;
  • improve the efficiency and productivity of palm oil smallholdings by increased access to knowledge, technology and credit;
  • encouraging replanting and other interventions that increase productivity to reduce the pressure to expand into High Conservation Value Areas.

New partnerships

To increase productivity in existing plantations, we need significant funds to invest in replanting with higher-yielding varieties and organizing and training smallholders. A financing mix of grants, loans and guarantees is required for this to be self-sustaining in the long run. Solidaridad seeks support from oil palm producers, traders, and financial institutions to establish investments for revitalizing low-productivity plantations. Under the POPSI programme, RSPO members match donor funding with private contributions at a ratio of 2:3. Donor contributions are pooled and lessons and tools are disseminated through the POPSI network and RSPO.

Cases

Palm oil company supports farmers

New Britain Palm Oil Limited supports smallholders in Papua New Guinea to achieve sustainable standards (RSPO). This will improve their productivity and margins.

RSPO standard includes smallholders

Solidaridad and the Round Table on Sustainable Palm Oil (RSPO) work together to include small scale palm oil farmers in the certified supply chain.

We offer

Solidaridad aims at a sustainable and fair palm oil chain, from farmer to consumer. The organization consists of a worldwide network of regional expertise centres and cooperates with local partners. Together we deliver the following services:

Our services in the Palm oil programme:

  • Training farmers in farming techniques that have less negative impact on people and the environment and lead to better and larger yields.
  • Supporting producer organizations through capacity building and organizational strengthening.
  • Supporting civil society organizations that empower women, farmers or employees, as well as organizations that protect nature and bio diversity.
  • Support and participate in global and national standard setting processes.

Results

Some of the key results in Solidaridad´s Palm oil programme:

  • Solidaridad is an active member of the Task Force on Smallholders of the Roundtable on Sustainable Palm Oil, promoting the interests of smallholders in the RSPO standard setting process.
  • Solidaridad is developing a global producer support programme with focus on Indonesia and Malaysia. We train trainers in better farming techniques and support smallholders to meet certification criteria.
  • Solidaridad initiated and supports research on gender issues on plantations. We collaborate with several NGO's that aim to halt gender discrimination.