Oxfam welcomes the world’s first shipment of sustainable palm oil, but warns much still to do

11 Nov: The world’s first shipments of certified sustainable palm oil have left Malaysia for the Netherlands where it will be used by European consumer goods manufacturers and supermarkets.

The 500-ton shipment, due in port later this month, is the culmination of a 5-year international project called the “Roundtable on Sustainable Palm Oil”. International agency Oxfam is a member of the Executive Board. There are 340 members in the initiative, including retailers, banks, NGOs and oil palm growers who currently account for 50% of the world’s palm oil production.

The Roundtable seeks to establish protections for millions of the world’s poorest communities, farmers and workers from land grabs and displacement, exploitation and poor conditions, meagre incomes, and devastating environmental impacts such as deforestation. The key values are transparency and stakeholder engagement.

“This first shipment is literally a drop in the ocean of world palm oil trade but it is the first step toward helping millions of poor and vulnerable women and men. We aim to have 50% of the world palm oil trade certified as ‘sustainable’ by 2013. Governments, traders, investors, manufacturers, retailers and consumers must now get behind this initiative to make it work,” said Oxfam spokesperson Adrie Papma.

“The RSPO will never solve all the problems associated with palm oil – the biggest being unchecked global demand – but nevertheless small-holder farmers and plantation workers could stand to benefit from it,” Papma said. “The RSPO must not become a vehicle for green-wash and scrutiny of it and its members by civil society will play a vital role in ensuring this.”

Palm oil is mostly used as “vegetable oil” in groceries such as cookies, shampoo and frozen fried products. It is estimated that half of all packed grocery items in supermarkets contain palm oil. Nearly 40 million tons of palm oil worth more than $20 billion is produced globally each year, 85% of it from Indonesia and Malaysia, and exported to Europe, North America and Asia.

The Roundtable was established for the food trade but palm oil is also being used increasingly as biodiesel and as a fuel for power generation. Oxfam is concerned that this potentially leads to unacceptably large expansion, while creating additional environmental and social problems.

Millions of small-holders supply palm oil mills. Almost 10 million hectares of land is now under cultivation. That area is expanding rapidly, leading to mass displacement of communities and rampant deforestation. “Instead of benefiting from trade opportunities, many millions of people have been trapped into cycles of poverty, losing their lands or being squeezed by powerful producers and traders in global supply chains,” Papma said.

Oxfam and other NGOs in the RSPO have contributed to the development of criteria, reliable certification rules and practical trade mechanisms. RSPO certification – once it is embraced widely by both growers and buyers – will help to assure manufacturers that their palm oil is not grown from land taken from communities against their will and that smallholders are being fairly treated by the millers and buyers, and that decent working conditions prevail. Producers must also have proved that they have stopped cutting primary forest since November 2005 in order to get RSPO certification. Large corporations will have to systematically certify all their plantations, not just their “flagships.”

In the coming year Oxfam expects that stakeholders will have brought test-cases to the RSPO grievance system. “The RSPO is just the start. We are fully aware that irresponsible producers and traders will continue their unsustainable practices. We now need additional strong controls by national governments and collective corporate action. But step by step, we hope to begin to make a difference,” Papma said.