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  • A truck drives through a palm oil plantation in Indonesia’s Central Kalimantan province. The country is one of the largest producers of palm oil in the world, along with Malaysia.

    A truck drives through a palm oil plantation in Indonesia’s Central Kalimantan province. The country is one of the largest producers of palm oil in the world, along with Malaysia. | Photo: Reuters

Published 14 October 2015

The production of palm oil has long been criticized by environmentalists, mainly because mass land and forests must be cleared for its production.

A new palm oil council is being established in Indonesia and Malaysia to create a joint set of standards for the industry, which will effectively abolish a previous “no deforestation” pledge made by major palm oil companies in the region, Reuters reported Wednesday.

Palm oil companies in Indonesia made the historic pledges at a climate change summit last year. After feeling international pressure to adopt better practices, some of the biggest palm oil companies in the region – including Cargill, Golden Agri-Resources and Wilmar International – signed the Indonesian Palm Oil Pledge.

However, according to the Indonesian government these promises are hurting smallholders who cannot afford to adopt to the sustainable practices.

According to the World Wildlife Fund, an area the equivalent size of 300 football fields of rainforest is cleared each hour to make way for palm oil production.

In an effort to boost production, Indonesian President Joko Widodo and Malaysian Prime Minister Najib Razak met last Sunday to discuss a joint plan to form the Council of Palm Oil Producing Countries. The plan will combine the palm oil production standards of the two countries and wipe away the past environment promises made in Indonesia.

“Indonesia and Malaysia have agreed to harmonize and combine our two standards,” Indonesia's chief natural resources minister Rizal Ramli told Parliament. “This is an example of how to fight for our sovereignty. We are the biggest palm oil producer. Why (should) the consumers from the developed countries set the standard for us as they want?” 

The production of palm oil has long been criticized by environmentalists, mainly because mass land and forests must be cleared in order to grow the palm fruit trees from which the oil is derived. According to the World Wildlife Fund, an area the equivalent size of 300 football fields of rainforest is cleared each hour to make way for palm oil production. This in turn changes local ecosystems and pushes species into extinction.

Palm oil is used predominantly in vegetable oil, which is found in some 40-50 percent of household products in northern countries such as the United States, Canada and Britain, according to the activist group Say No To Palm Oil.

Indonesia and Malaysia account for some 85 percent of the world's palm oil production, reported Reuters.

According to Ramli, the new council will use the same standards set out in the IPOP to protect the interests of developed countries' vegetable oil markets. However, it would also add new standards that could consider the smallholders, said Ramli, including not holding them to environmental standards.


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