RSPO. PALMEX THAILAND. 8-9 September 2011 Sustainable Palm oil and the Environment

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1 PALMEX THAILAND 8-9 September 2011 Sustainable Palm oil and the Environment By: Salahudin Yaacob, Technical Director on behalf of Darrel Webber, Secretary General of RSPO

2 CONTENT Palm oil in global context Sustainable Palm oil RSPO Statistics on Sustainable palm oil RSPO Trademark

3 What is palm oil? Palm Oil... A highly versatile vegetable oil Used in many food and non-food products Produced in tropical countries Rapidly growing market share World s top selling vegetable oil

4 World palm oil production Source: FAO statistic 2011 Figures for year 2009 Area (ha) FFB (mt) CPO (mt) World 14,921, ,326,664 45,083,932 Indonesia 5,000,000 86,000,000 20,550,000 Malaysia 4,002,000 84,842,000 17,564,900 Thailand 510,213 8,162,380 1,310,000

5 Oil Yield Average yield per year (tonnes of oil per hectare) Oil palm: 3.68 Rapeseed: 0.59 Sunflower: 0.42 Soybean: 0.36 Source: Oil World

6 Palm oil facts Palm oil production in year 2010 is about 45.9 million tonnes (33% of world s production for oils and fats) Projection for oil palm production in 2015 is million tonnes and million tonnes in 2020 Estimate further 12 million hectares of new land to be developed to satisfy 2020 increment In Malaysia, export value of palm oil and its derivatives = USD16.5 billion (7.5% of gross national product/ 4 th largest contributor to national economy in 2009) In Indonesia, palm contributed USD7.9 billion to GNP in 2007 Oil palm is 6-10 times more productive than the competing edible oils Oil palm contributed more than one third of global vegetable oils production but only requiring about 5 % of the world s total area under vegetable oil crops.

7 Why go sustainable?

8 Why sustainable palm oil? Millions of people are dependent on palm oil More than1 million workers More than3 million smallholders Many more household members

9 Why sustainable palm oil? Environmental issues in oil palm cultivation Forest, peatland conversion Climate change Biodiversity loss

10 Why sustainable palm oil? New way of doing business Business communities strive towards becoming good corporate citizen Multidimensional definition of sustainability through transparency and stakeholder involvement Market driven initiatives providing a win win situation to producer and user

11 Hence, the RSPO

12 About the RSPO Started in 2003 with 7 members Formally established in April 2004 Multi-stakeholder association International non-for-profit association Palm oil supply chain Promotes growth & use of sustainable oil palm products through global standards RSPO Principles and Criteria (P&C)

13 Vision RSPO will transform markets to make sustainable palm oil the norm

14 What is Sustainable Palm Oil? RSPO seeks a balance development for the Palm Oil industry that is Legal, Economically Viable, Environmentally Appropriate and Socially Beneficial

15 Finding the Balance

16 RSPO P & C Law & Regulation Economic /Financial Viability Best Agriculture Practice Transparency RSPO Sustainable Palm Oil Environmental Social New Planting Continuous Improvement

17 Sustainable Palm Oil In brief, RSPO certified palm oil originated from plantation that: Management system and its implementation done on transparent manner Planted on land with clear tenureship Operation complies with legal requirement Proper management plan addressing economic, social and environment Replanting done to ensure sustainable production

18 Sustainable Palm Oil In brief, RSPO certified palm oil originated from plantation that: Best management are practiced at all level of operation Biological control over chemical solution Environmental evaluation identifying biodiversity and HCVs are done and plan for its management are compiled Environmental impacts including GHGs emission are minimised

19 Sustainable Palm Oil In brief, RSPO certified palm oil originated from plantation that: Social impacts are identified and managed Management contribute to local communities and socio-economy Workers are taken care off No conversion of primary forest and HCVs after Nov 2005 All activities are monitored and improvements are made Sustainable palm oil is traceable throughout the supply chain

20 Stakeholder / Membership representation

21 Membership Value

22 Membership Overall Steadily growing on an annual basis Membership allows non certified companies to aspire towards certification goal Supply Chain: 63 Ordinary: members Affiliate: 95

23 Our Members Banks &Investors Oil Palm Growers Palm Oil Producers and/or traders Retailers Social NGO s Environmental or Nature Conservation Groups

24 Just within 3 years since the certification of sustainable palm oil (CSPO) by the (RSPO), a multi stakeholder initiative, the industry reaches a turning point by hitting its first 1 million hectares of certified production area around the world.

25 TODATE RSPO Certified 26 growers & 121 POMs 1.03 mil ha 105 companies, 187 SC certificates 4.96 million mt CSPO

26 PHENOMENAL GROWTH Year on Year Growth 100% from 2009 to 2010 CSPO Production In less than 3 years, RSPO CSPO is 8% of PO production 5 million metric tonnes of CSPO I million hectare of certified production area reached Market Uptake 26% in 2009 More than doubled to 56% in 2010

27 Volume of CSPO produced

28 The Future Our wish by end million mtof CSPO is produced annually All grower member has atleast one unit certified Significant portion produced by independent smallholders Demand for CSPO exceed the production

29 RSPO Trademark For on/aboutproduct communication Upstream (Growers) Rules for use, communication & licensing under development Trademark registration procedures begun in more than 60 countries Processors/Traders; Bankers & Investors NGOs Consumer Goods Manufacturers Expected launch for use: July 2011 Downstream (Retailers/ consumers)

30 MALAYSIA TO HOST WORLD S LARGEST SUSTAINABLE PALM OIL MEETING 9th Annual Roundtable Meeting on Sustainable Palm Oil (RT9) will be held in Kota Kinabalu, Sabah this year.

31 TOGETHER FOR SUSTAINABLE PALM OIL