Netizens Debate Over Video “Why Palm Oil So Cheap?”, Who’s Right?
A Twitter account was posted a video entitled “Why Palm Oil So Cheap?“. The video has been watched by 2.2 million viewers in just 5 days and got enough attention from Twitter Users seen from amount of likes, retweets and comments. In the video, it shows that palm oil is found in the composition of almost all consumer goods consumed by the global community, from food products, toiletries, to energy. Even average consumption of palm oil also reaches 8 kilograms/year/capita.
Palm oil has many advantages, one of the advantages of palm oil that is unbeatable by competitors because it’s efficiency. The productivity of palm oil is 10 times higher than other vegetable oils and its production throughout the year so that its availability and supply is relatively stable. The implication of these two advantages is that palm oil’s price is cheaper.
After conveying the advantages contained in palm oil, the video also informs about the negative impacts of palm oil production on the environment, such as deforestation and increased emissions. Therefore, NGOs and companies around the world under the Roundtable Sustainable Palm Oil (RSPO) organization have developed criteria and certification systems for sustainable oil palm cultivation, one of which is using the High Carbon Stock approach.
However, the implementation of RSPO certification faces challanges because most of the (consumer) markets for palm oil are developing countries such as China and India much more of an emphasis on prices rather than the sustainability of product. Otherwise, western consumers (such as the European Union and the USA) who have a preference for sustainability of palm oil, but they limited leverage in encouraging producers to produce deforestation-free palm oil because the producers have alternative market to sell into.
However, the video convey some inaccurate information so that it needs to be correcting to minimize misleading information, which have an bad impact on the image of palm oil.
In the video, it is stated that in order to meet the increasing demand for palm oil, producers are expanding palm oil plantations so that it has an impact on increasing the deforestation. Although in video also stated that palm oil is not the only driver of deforestation, however this article will reaffirmed using valid date. In fact, based on data and empirical facts published by the European Commission in 2013, the proportion of oil palm plantations to global deforestation is very small, it is only 2 percent. Moreover, the share of cereal (rice, corn, wheat) and soybeans in global deforestation is also greater than oil palm, which is 8 percent and 6 percent, respectively. The largest driver of global deforestation is livestock sector (cattle and beef production) with a share of 24 percent.
Empirical facts also showed that most oil palm plantations in Indonesia comes from agroforestry and scrubland. The scrublands were abandoned lands which were found mostly in Sumatra, Kalimantan, and Sulawesi, formerly is as forests with massive logging activities during the New Order era. Then the oil palm plantations came and developed on abandoned land. This shows that it is not the main driver of deforestation, instead, it is a driver of reforestation that re-greening the ecological, economic, and social communities in areas that are damaged by logging in the past.
In addition to being driver of deforestation, the video also stated palm oil contributing to increased emission, which further make worse of global warming. Whereas all human activities, including breathing (exhale or discharge carbon dioxide), also contribute to increasing carbon emissions. The study of Olivier et al., (2020) states that the main component of GHG emissions is carbon emissions, and most of them come from fossil energy burning in the industrial, electricity, and transportation sectors. The results of this study are also in line with IEA data which states that the global fossil energy sector (coal, gas, and fossil oil) both in the production and consumption processes contributes 68 percent to global GHG emissions.
On the other hand, instead of being an main actor, palm oil industry generates solutions to reduce GHG emissions so that they can minimize the impact of global warming and global climate change. Oil palm plantations have role as the “lungs” of the ecosystem because they have the ability to photosynthesize by absorbing carbon dioxide from the earth’s atmosphere and producing oxygen into the earth’s atmosphere. This industry also able to contribute to reducing or saving emissions by providing palm oil-based biofuels as sustainable energy and low carbon emissions such as first-generation biofuel energy (biodiesel and green fuel), second-generation biofuel energy (bio-premium/bio-gasoline/bioethanol, bio-pellet, biogas/bio-electricity, bio-coal) and third-generation biofuel energy (biogas/bio-electricity and biodiesel algae).
These facts show that the issue of palm oil as the main cause of deforestation and GHG emission is a black campaign carried out by anti-palm oil NGO’s and part of the trade competition between other vegetable oil producers. Even though they have been victims of crop-apartheid and discrimination, palm oil producers are still trying to meet the sustainability standards desired by western consumers by following RSPO certification. Based on the RSPO updated data, the area of global oil palm plantations that have been certified by the RSPO reaches 4.13 million hectares with CPO’s volume of 15 million tons.
Palm oil is also the first and the only global vegetable oil that has a management system and certification of sustainability. Other vegetable oils such as soybean oil and rapeseed oil, which are widely produced by countries that often discriminate against palm oil (EU and USA), do not even have a sustainable management system and sustainability certification.
To produce CPO has RSPO certified, a additional cost is required and charged to producers, both plantation companies and smallholder. This additional production costs also not accompanied by premium price for Certified Sustainable Palm Oil (CSPO). This means that there are no incentives and added value that can be enjoyed by producers for their efforts to produce palm oil that has met the demands of western consumers.
The absence of a premium price is an implication of the lower absorption of the global market for CSPO. Every year, CSPO sales are below 50 percent, even in the last three years, it has not reached 30 percent. This has resulted in an oversupply of CSPO every year. Western countries that have been shouting and demanding producers to produce CSPO, but after they fulfilling the demands, western countries has not been able to absorb CSPO and provide premium prices. Then who should be responsible?
This condition also brings out curiosity, whether the sustainable certification system really intends to protect the environment and reduce emissions, or only “burdensome or troublesome” the palm oil industry. An interesting fact from the journal “The Burden of RSPO Certification Costs on Malaysian Palm Oil Industry and National Economy” published by the Malaysian Palm Oil Council (MPOC) states that activities and transportation in RSPO certification increase carbon emissions. The journal also explains that the carbon footprint of certified palm oil is higher than uncertified palm oil. The journal author’s team also suggested that if you want to contribute to reducing emissions, it is better if the certification- budget is diverted to significant activities to reduce the carbon footprint in oil palm plantation companies, such as using of capture methane for management technology of POME in the mill.
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