Palm oil industry launches PR campaign

Down to Earth No.75, November 2007

Evidence from local and international NGOs about the impacts of large-scale oil palm plantations on the environment and communities has made some buyers and parliamentarians in Europe realise that palm oil is not the 'green', sustainable product the industry claims. Now Indonesia and Malaysia have launched a public relations offensive in Britain and the Netherlands to try to secure markets for the millions of tonnes of palm oil that they produce.

Indonesia and Malaysia signed a Memorandum of Understanding on Bilateral Co-operation in Commodities in May 20061. This included co-operation on the production, processing and marketing palm oil. While some feared this would create a monopoly, the two countries described it as a strategic alliance with Malaysia offering capital investment and technical skills and Indonesia providing land and labour. Ensuring high demand for Indonesian and Malaysian palm oil was an important part of this strategy.

Malaysia has taken an aggressive stance - particularly towards wildlife campaigners who argue that the palm oil industry kills orangutans by clearing forests - claiming this is an attempt by the North to undermine competition on the global market for edible oils and fats. "When Malaysians get angry, they fight. And I guarantee you we will win," said Energy, Water and Communications Minister Lim Keng Yaik last year2. The head of the Malaysian Palm Oil Council said about 500,000 tonnes of potential palm oil sales had been lost in 2006 because of buyers' concerns about environmental issues3. Unilever alone uses over 1Mt of palm oil every year, most of which comes from Indonesia and Malaysia4. So, Indonesia and Malaysia agreed to allocate 500,000 Euros to run a pro-palm oil counter campaign5.


Lobbying in Europe

Both countries have sent high-powered delegations of government and industry representatives to Europe to promote 'sustainable palm oil'. Indonesian agriculture minister, Anton Apriyantono, made a three-day visit to London in early October. Before leaving Indonesia, the minister told the Indonesian press that he would be meeting European NGOs to correct their 'misunderstandings' about oil palm plantations, forest destruction and endangered species6. In fact, no NGOs were invited. The mission's main purpose was to address British palm oil buyers, processors, agrofuel companies and other elements of the business community.

Apriyantono also met with British government representatives, including DEFRA Secretary of State, Hilary Benn, to convince them that Indonesia is in the process of producing and promoting sustainable palm oil. Benn was reported in the Indonesian press as welcoming the pro-oil palm delegation's "balancing message"7. He has not yet responded to Down to Earth's enquiry, accompanied by an English translation of the press release, about whether this was indeed his position.

The delegation went on to hold similar meetings in the Netherlands, which is a major market for Indonesian palm oil. They also went to Brussels, where they lobbied EU officials and MEPs to adopt a more positive attitude toward Indonesian palm oil. European NGOs, including Friends of the Earth, Biofuelwatch and many others, are campaigning for the EU to scrap its target for agrofuels for transport8.

European Heads of State agreed in March this year to a target that 10 percent of transport fuels should be supplied by agrofuels by 2020. This target is, however, conditional on agrofuels being produced sustainably and also on the successful commercial development of so-called 'second generation fuels', which are produced by converting biomass to liquid9. The Biofuel Directive will not be published until early 2008 and it will take over a year to complete the legislative process. In the meantime, however, an even higher de-facto biofuel target could be agreed as part of the new Fuel Quality Directive. This could be voted on as early as January, after the certification system for 'sustainable palm oil' proposed by the Roundtable on Sustainable Palm Oil (RSPO) has been approved by its membership at the 5th Roundtable meeting in Kuala Lumpur November 19-21.

The Indonesian lobby tour in Europe followed a similar Malaysian 'PR offensive' in June. Plantation Industries and Commodities Minister Datuk Peter Chin Fah Kui said he would explain the reality to British MPs in London and members of the European Parliament in Brussels about "our efforts to conserve the environment and biodiversity while we develop our palm oil industry....The Cabinet wants to counter European anti-palm oil activists on their own home ground"10.

The Malaysian and Indonesian pro-oil palm campaign has failed to convince decision-makers in the Netherlands. The Dutch government recently announced that it will exclude palm oil from 'green energy' subsidies as growing evidence suggests that palm oil is often less sustainable than advertised. Research by Dutch-based consultancy Delft Hydraulics and Wetlands International that showed the climate impact of the conversion of carbon-rich peatlands for oil palm plantations was highly influential in this decision11 (see also separate article, below).



Indonesia sent a second delegation to Europe in late October to promote its 'sustainable palm oil'. This time NGOs were invited to meetings in London and the Hague to listen to presentations made by a panel selected by the department of agriculture and the Indonesian Palm Oil Board.

Senior representatives of PT London Sumatra, Asian Agri, PT SMART (Sinar Mas) and Jardine Matheson Holdings (Astra Agro Lestari) described how their companies' operations in Indonesia were making efforts towards 'sustainable palm oil', while Jan Kees Vis of Unilever, who is current president of the RSPO, gave an update on the status of the RSPO. The agriculture minister did not come to London; his speech was read by the Director General of Agricultural Product Processing and Marketing (Prof Djoko Said Damarjati) who did not participate further. The meeting was chaired by Derom Bangun who is chair of the Indonesian Palm Oil Association (GAPKI).

These meetings were carefully stage-managed by the Indonesian palm oil industry to showcase examples of 'best practice'. European NGOs' attempts to negotiate a more open agenda were ignored and, in the end, only limited questioning of the panel was permitted. Over lunch, Indonesian Palm Oil Commission members harangued British and Dutch NGOs for "presenting lies and only focusing on the bad news".

This arrangement allowed the palm oil industry to present some highly selective data and to make unsubstantiated claims. These included the rejection of evidence that Indonesia was the world's third largest contributor to carbon emissions and numerous examples of how the companies represented on the panel had played a key role in local development and increasing local incomes. There were repeated denials that the companies present were involved in any forest conversion or burning to clear forests. Any examples cited by NGOs were dismissed as past mistakes or the work of rogue elements.

No government representative was on the panel, so there was no response to points about the need for integration of Indonesian policy on land use planning, oil palm plantations and agrofuels across government departments or to answer questions about how Indonesia would be able to comply with RSPO standards unless land reform was implemented and indigenous rights recognised.

The glossy press pack contained more misinformation, including that oil palm plantations were more effective at reducing greenhouse gas emissions than tropical rainforests. (see box, below).

Apriyantono claimed in his statement to the palm oil business community in London that "over 80% of palm plantations in Indonesia are in compliance with High Conservation Value Forest (HCVF) criteria"12. The panel members were also keen to promote their environmental credentials, with various examples of HCVF protection of within oil palm concessions and co-operation with wildlife organisations like WWF Indonesia. However, the Zoological Society of London (ZSL) used the London palm oil meeting to challenge Indonesian government policy of allowing oil palm plantations to be planted on former logging concessions. A ZSL study shows that even logged-over forest can be vitally important to endangered wildlife, including the Sumatran tiger. Yet large tracts of such forest land are being cleared for plantations without any assessment for its value to conservation or to local communities13.

While the company representatives and GAPKI promoted their commitment to corporate social responsibility as shown through their community development programmes, the only presentation from the panel which focused on the social problems of Indonesia's rapidly expanding palm oil sector came from Sawit Watch. The Indonesian NGO's director, Rudy Lumuru, talked about the need to find mechanisms to resolve conflicts between communities, oil palm companies, their contractors and local governments. Sawit Watch recorded over 500 such conflicts in 2006. The group warned in a public statement earlier this year that European agrofuel targets were driving up international demand for palm oil, thus fuelling social and land conflicts14.


Oil palm is better for planet than forests, says industry

Indonesian government and palm oil industry representatives are claiming - in public meetings and publicity materials - that converting forests to oil palm plantations is a good way to tackle climate change. A glossy booklet produced by the Indonesian Palm Oil Commission, much quoted by panel speakers at the London and The Hague meetings, claims that "Compared to tropical forest, oil palm plantations possess several environmental advantages. It consumes more carbon dioxide and releases more oxygen".

This is bad science because it confuses carbon flows with carbon storage. When any tree grows, it takes in more carbon than it loses by respiration, because carbon is one of the building blocks of the tissues in the roots, branches and leaves which are all increasing in size and number. So rapidly growing trees - whether pulpwood or oil palms take in relatively large amounts of carbon over short time scales. In contrast, in a mature forest, the amounts of carbon taken up by replacing fallen trees or leaves is more or less balanced by the carbon released by decomposing materials on the forest floor.

Primary tropical forests 'lock away' huge amounts of carbon over long time periods. On the other hand, most of this is released when the forest is cut down and burned or timber is pulped into paper which ends up rotting in landfill sites. Oil palm plantations do not store as much carbon because the trees are not so large and the ecosystem is much simpler. Moreover, oil palms are cut down and replaced every twenty or so years. If plantations are established on peat soils, the carbon losses are even greater.

In addition, fertilisers used on plantations, plus the fuel burnt for processing and transport, cause more emissions of greenhouse gases. The result is that palm oil used as an agrofuel in Europe may cause carbon emissions 2-8 times higher than the fossil fuels they were intended to replace. Only where oil palm plantations are established on sparse grassland with low fertiliser and transport inputs do the figures on carbon emissions even begin to add up15.


2 AFP 16/May/2007 
3 AP 25/May/2007 
4 Cooking the Climate, Greenpeace, Nov 2007, p40 
5 Jakarta Post 19/Jul/06 
6 Pontianak Post 29/Sept/07 
7 RRI Online 3/Oct/07 
10 Nation, 20/May/07 
12 accessed 31/Oct/07 
13 Critical wildlife havens at risk, ZSL press release, 31/Oct/07, 
15 For more detailed discussion see

Thanks to Biofuelwatch for contributions