Feb 9

Golden Agri-Resources (GAR), the world’s second-largest producer of palm oil, today signed an agreement with international environment group The Forest Trust (TFT) in a landmark bid to save Indonesia’s carbon-rich forests and peatlands.

The partnership establishes a Forest Conservation Policy and a set of measures to ensure that GAR’s plantations are not developed at the expense of carbon rich forests, or on peatlands. It is hoped that this landmark new deal will contribute to the end of forest destruction in areas which are hugely valuable in terms of biodiversity and local livelihoods.

Palm oil expansion

Palm oil is used widely in processed foods, cosmetics and soaps. The oil may be found in roughly half of packaged supermarket products, and is increasingly being used as a biofuel.

In recent years, the palm oil industry has experienced huge economic growth, with new palm oil plantations spreading across Indonesia and Malaysia. With a yield which is almost six times higher than other oil producing crops, palm oil plantations offer vast returns. However, it is estimated that more than half of the palm oil expansion since 1990 has occurred at the expense of forests.

Photo of the deforestation caused by palm oil plantation in Tanjung Puting National Park, Borneo

Deforestation caused by palm oil plantation in Tanjung Puting National Park, Borneo

As well as concerns that we are losing forests that are vitally important for absorbing greenhouse gases, the rapid destruction of forests in Sumatra, Borneo, New Guinea and other islands is having disastrous consequences for the region’s endangered wildlife, including the Bornean and Sumatran orang-utans, the Sumatran rhino, and the tiger.

“Rainforests and peatlands across Southeast Asia are being torn up to provide land for oil palm plantations,” says Scott Poynton, TFT’s executive director. “Without better stewardship, the phenomenal growth of the palm oil industry could spell disaster for local communities, biodiversity, and climate change as palm plantations encroach further and further into forested areas.”

Photo of Bornean orang-utan male in tree

Bornean orang-utan male in tree

Creating new standards

The new deal expands on existing standards agreed under the Roundtable on Sustainable Palm Oil (RSPO), an international alliance of producers, processors, retailers and environment groups.

Franky Wijaya, chairman and CEO of GAR says that “As a leading player in the palm oil industry, we are committed to playing our role in conserving Indonesia’s forests.”

We will leverage our leadership position and advocate this policy in partnership with the Indonesian and global community.”

Photo of Female Sumatran rhinoceros scratching

Female Sumatran rhinoceros scratching

Cautious optimism

Greenpeace, which led a campaign that highlighted the role of GAR’s Indonesian plantations in driving deforestation, has said it is cautiously supportive of the new deal and that in the coming months it will closely monitor GAR’s progress in implementing its commitments.

This is really throwing a gauntlet down to the rest of the palm oil sector, and to other players,” said Greenpeace campaigner Phil Aikman.

The Forest Trust (TFT) says it will work closely with a range of stakeholders to ensure GAR upholds its commitment.

Read The Forest Trust’s press release and the Golden-Agri Resources’ press release.

Explore Indonesian species on ARKive.

Helen Roddis, ARKive Species Text Author