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Palm oil trends for 2020


When the clock strikes twelve on 31 December this year, it will not only signify a new year, but a new decade. With extreme weather occurrences on the rise and published data highlighting the urgent need for action on climate change and biodiversity, 2020 is expected to be an important turning point in our timeline.

A super year for climate and nature

The United Nations reports that climate change is accelerating, greenhouse gas emissions are increasing and we have less time than expected to implement actions in order to avert climate-related disasters. Its 2019 Emissions Gap report states that we need to reduce 7.6 percent of greenhouse gas emissions per year from 2020 to 2030 to meet the cap of a 1.5 degrees Celsius increase in global temperatures.

Protecting biodiversity and nature are inevitably linked to the climate agenda – the UN reports that nearly a million species are facing extinction because human activities on land and in the ocean are destroying nature at an unprecedented rate. Conserving, restoring, and protecting biodiversity are critical, and we expect a big push in these areas in 2020. Influential organisations such as the International Finance Corporation and the EU are already pushing for biodiversity reporting, where companies publish the impact of their investments and operations on biodiversity.

It is time for action. From governments and NGOs to private-sector companies, and even individuals – everyone needs to sit up and pay attention, because the actions taken now will determine if the next decade is one filled with positive change, or fraught with doom and despair.

We protect endangered species found within plantations, such as the orangutan.

From charismatic megafauna such as orangutans and elephants, to the smallest insects and microscopic soil biota, oil palm plantations can be biodiverse, despite being monocultures in terms of the single product harvested. Managed well they can also positively contribute to nature and biodiversity corridors.

Our longstanding partnership with the University of Cambridge is helping us determine how best to maximise such positive contributions – developing and examining management strategies that support biodiversity and ecosystem processes in oil palm landscapes. The latest project investigates how extreme weather patterns impact oil palm ecosystems and production. The data will help to determine how to improve resistance and recovery of ecosystem processes in oil palm plantations in the face of drought.

This will be particularly important in 2020 as El Niño is expected to hit again.

El Niño phenomenon

From extreme rainfall in Peru and Southern US to drought conditions in Indonesia, Australia, and the Western Pacific, the effects of El Niño in 2015 could be seen across the world. For agribusinesses like ours, the extreme dry conditions expected in the second half of 2020 means further stepping up our fire prevention and fire-fighting efforts.

Staying vigilant for potential fire hazards in plantations is crucial.

In 2019 we experienced more fires than the previous three years. While the number was still less than 2015 and less than one percent of our estate was impacted, we learned some useful lessons. This year’s fires have taught us:

  • we still need improved water resources planning;
  • more behavioural change efforts are needed – people too easily slip into old habits like carelessly tossing away cigarette butts;
  • low crude palm oil prices have an impact as smallholders slow down fertiliser purchasing and revert to traditional slash and burn techniques to enrich the soil.

We will be intensifying our education efforts within communities releasing a new series of educational materials aimed at schools in the new year. We’re not only relying on the pester power of future generations – as championed by the Greta Thunberg’s of the world – but we do see children, mothers, and educators as critical actors in changing the acceptance of fire in some of these communities. We will also continue our experiment with direct messaging via tools like WhatsApp to share fire prevention messages and reminders of the serious penalties for those found starting fires or failing to put them out promptly.

2020 was the Consumer Goods Forum’s (CGF) target year for zero net deforestation in key supply chains. But with brands like Nestlé, Procter and Gamble, and Cargill publicly admitting they will not meet their zero deforestation goals next year, it is clear that the 2020 ambition will not be met.

That missed deadline will be exploited by some as evidence of a lack of commitment or effort. Such criticism ignores the significant progress that has been made, at least in the palm oil sector.

Looking ahead, GAR hopes consumer goods companies and other palm oil end users will work increasingly collaboratively to come up with shared approaches to addressing deforestation in commodity supply chains. We are already seeing these collaborations take shape via landscape approaches involving multiple actors, and the recent RADD announcement where GAR, along with Pepsico, Nestle, Unilever and others, is working with World Resources Institute to co-develop a radar-based monitoring platform.

Plant-based diets

For many years, evidence has grown that cattle farming is the world’s largest contributor to deforestation, emits a large amount of greenhouse gases, and that a reduction in meat intake would help the environment.

Only now are we finally seeing a shift. Perhaps it is because the health and wellness movement has coincided with environmental tipping points, making this a more open conversation. Sources like the ‘EAT-Lancet Commission on Healthy Diets From Sustainable Food Systems’ report and Netflix’s The Game Changers are excellent materials for those looking to move towards plant-based diets.

The fact is, there is an urgent need for consumers to transition from a meat-based to a plant-based diet. Our global challenge is to build a sustainable food system that can feed 10 billion people by 2050. Demand for vegetable oils is expected to go up over this same period, so palm oil (as the most productive vegetable oil) will have a role to play in supplying that demand without increasing land under cultivation.

Our work in R&D is coming up with solutions for a sustainable plant-based diet future. Our scientists are not only developing techniques to improve yield in the fields, our food technologists are crafting clever ways to create vegetable-based substitutes for products like dairy, that are still tasty and nutritious for consumers.

Food technologists like Punjung come up with new flavour profiles for our palm oil cooking products.

The road ahead

2020 will be an important year for humanity. At GAR, we aim to secure better outcomes for nature and conservation through ramping up education efforts and improving rural livelihoods. Projects like our Integrated Ecological Farming and partnership with Wageningen University will be key. You cannot achieve positive environmental or social outcomes without ensuring people have stable incomes and an economically vibrant future. Through our various alternative livelihoods approaches we want to demonstrate how rural development and conservation can co-exist.

Consumers too have a part to play in their consumption habits. To support crops that are grown responsibly instead of blind boycotting (not just palm oil, but all commodities). They can demand that the products they buy (and love) contain palm oil from sustainably managed plantations. Think “buy-cott” not boycott and buy sustainable palm oil.

Governments around the world can support this transition by avoiding protectionist approaches and embracing fair, equitable sustainability criteria. Based on accepted certification systems, procurement of commodities can contribute to climate, nature and poverty alleviation agendas, delivering on the promise of the UN Sustainable Development Goals.

The world is impatient for positive change. Positive change is, and continues to be, underway in GAR and the wider palm oil sector.

In 2020 we invite consumers, customers, financial institutions and investors, governments, and other stakeholders to support us in accelerating the delivery of sustainably produced palm oil.

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