Palm oil can be produced responsibly

19 September 2010

The last couple of weeks have again witnessed a major anti-palm oil campaign by Greenpeace in Finland’s largest cities, based on claims that the use of palm oil as a raw material for producing fuel is destroying the world’s rain forests.While it is true that palm oil is not always produced in a way that respects nature and that bad practices in the field continue to exist, there are a number of responsible players in the business that have systematically developed production methods that meet responsible criteria and have helped set higher standards in the industry.

Oil palm

Demand for palm oil is increasing, in China and India in particular, according to those in the industry, and buyers in these countries appear much more interested in volume and price than how the oil they buy is produced.

Around 80% of the world’s palm oil is used in the food industry. In Europe, we eat palm oil in products such as ice cream, breakfast cereals, cookies, chocolate, and ready meals. In Southeast Asia, palm oil is primarily used for frying and everyday cooking.

Palm oil is a key product in terms of the world’s food supply, even though medical experts do not consider it a healthy product from a nutritional standpoint. Palm oil production also generates a number of by-products, such as stearin, which is largely unsuitable for food use but can be used in biofuel production.

The question is often raised as to whether it is more important to produce food or raw materials for fuels. It could well be a good thing to produce materials that can be used both for food and fuel purposes. During food crises, fuel use can be reduced and larger volumes diverted to the food chain.

Oil palm cultivation provides employment for millions of people and gives many poor families access to health care, education for their children, and things like electricity for their homes. In fact, the oil palm has become a central element in helping eliminate poverty in Southeast Asia.

The oil palm offers the largest yield of any oil plant currently grown. Yields per hectare in Malaysia average around four tons, roughly quadruple what farmers achieve with oilseed rape in Europe. The best plantations can achieve yields as high as 10 tons a hectare. Cultivation also calls for less fertilizer and less machinery than cultivating oil plants in Europe does.

Palm oil output can be increased significantly by improving cultivation methods, without touching rain forest. There is also estimated to be 10-20 million hectares of other forest and wasteland in Southeast Asia without any intrinsic environmental value that could be used for oil palm cultivation.

Member states of the European Union will be required to increase their use of renewable energy to 20% by 2020 under new regulations recently introduced, and increase their use of biofuels in traffic and transport to 10% within the same time frame. Finland has set even higher targets.

Palm oil is among the raw materials approved by the EU for biofuel production. The renewable diesel produced by Neste Oil, for example, reduces greenhouse emissions by 40-80%, depending on the raw materials employed; using palm oil, the reduction is around 60%. Emissions could be reduced even further, and substantially so, if more attention was paid to things like wastewater treatment in raw material production – and things are already moving ahead in this area.

Palm oil is not the only raw material that can be used in producing renewable diesel. In Finland, Neste Oil uses virtually all the waste fat produced by the country’s meat processors at its renewable diesel plants, in addition to palm oil. The proportion of rapeseed oil it uses is also on the increase. A lot of R&D is being done in the field, and algae, microbes, and forest harvesting waste, for example, are expected to become new sources of raw material in the future.

The campaigns mounted by organizations such as Greenpeace have tended to focus on major users of palm oil in Europe and their customers. It is precisely these users, however, that have been instrumental in bringing new standards promoting responsibility and sustainable development to oil palm cultivation.

One could ask what or who would be left if the best players in the field were to leave the palm oil market. In all probability, the progress that has been made towards achieving greater responsibility would come to a stop and the best practices that have been established would gradually fade away. Demand, however, is unlikely to stop growing – and would probably be met at the expense of the world’s rain forests.

Article by Neste Oil’s Deputy CEO Jarmo Honkamaa originally published in the Guest Writer column of Helsingin Sanomat on September 19, 2010

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