The palm oil plantations of Malaysia
It is impossible to miss Malaysia’s palm oil plantations.
Visitors get their first glimpse of the palms that are now ubiquitous across the country on the descent into Kuala Lumpur International Airport; itself built on land that was previously a plantation.
Once on the ground, palm oil trees line the highways into Kuala Lumpur and beyond.
Palm oil is not native to Malaysia but it is now the country’s second biggest export, worth 83.4 bn Malaysian ringgit in 2011.
After Indonesia, Malaysia is the world’s biggest producer of the commodity, which is used in an eclectic range of products from ice cream to cleaning fluids and chocolate.
These are the kind of things that rarely go out of fashion and navigate recessions unscathed, which helps explain why Felda made such a strong debut on Thursday. The sale helped the company, which was set up as a co-operative 30 years ago to help rural Malaysians out of poverty, raise more than $3bn for expansion.
But while palm oil has helped turn Malaysia into one of the world’s trading powerhouses and lifted the incomes of hundreds of thousands of people, it is also triggered global controversy.
The biggest concern is the environment - plantations simply do not support the same variety of wildlife as the rainforest they so often replace.
Consider the area surrounding Sabah’s longest river, the Kinabatangan, on Malaysian Borneo. In the past 30 years, 87 per cent of the forest has been converted to plantation leaving the native orang utan, proboscis monkeys and pygmy elephants struggling to survive in isolated patches of fragmented forest. Orangutans, which normally live high in the canopy, are frequently forced to the forest floor and researchers have even discovered nests on palm oil trees.
Then there are the chemicals and fertilisers that many plantations use to stimulate growth and keep bugs at bay.
And the conflicts with indigenous people who have lived for generations in the jungles that are now being converted to plantations. Often they claim customary rights to the land.
After years of criticism, the industry appears to be moving towards a policy of engagement rather than confrontation.
The Roundtable on Sustainable Palm Oil was set up in 2004. The group, currently headed by Darrel Webber who previously worked for the WWF in Sabah, includes members from across the industry; from planters to buyers, NGOs and bankers.
Together, the RSPO has created what it believes are globally credible standards covering the environment, local communities and labour standards. Those who don’t comply face investigation and suspension. In what’s being seen as a test case for the organisation, the RSPO is investigating an alleged breach of the rules by Malaysia’s second biggest palm oil company IOI.
As of November last year, the roundtable says it was able to certify 10 per cent of global oil palm production as sustainable.
This is encouraging, but with so much money at stake, and plantations continuing their expansion, there is a clearly a long way to go.