Another government probe uncovers widespread illegality in Indonesia’s palm oil sector

Friday, October 18th, 2019

Yet another government investigation has identified widespread illegality underpinning Indonesia’s sprawling oil palm plantation sector, officials have announced.

On 10 October Prabianto Mukti Wibowo, a senior forestry management official at Indonesia’s Coordinating Ministry for Economic Affairs, announced that 3.1 million hectares (ha) of palm oil plantings were illegally located without required permits on land classified as forests.

The 3.1 million ha of illegal plantings make up nearly 20% of the country’s 16.38m ha of palm plantations. They also account for over 30% of the 9 million ha of oil palm the Ministry of Environment and Forestry (KLHK) has found to be located in the forest estate.

Authorities announced they intended to identify the owners of the unlicensed concessions and were taking legal advice on how to deal with them.

Further, while 5.8m ha of those 9m ha of palm concessions located on land classified as forest had received permits, KLHK found 1.4m ha of these lands are still heavily forested – raising the prospect that they may be taken back by the state under the terms of a 2018 oil palm moratorium and permit evaluation issued by President Joko Widodo.

The damning official findings follow on the heels of and appears to reinforce an August 2019 announcement by Indonesia’s Supreme Audit Agency (BPK) which reportedly found that 81% of palm concessions in the country violated national laws or mandatory plantation management requirements.

While the Supreme Audit Agency study is yet to be published, it is understood that the 20% of plantings KLHK identified to be located illegally in forest areas contribute to the 80% found in violation of Indonesia’s laws and sectoral requirements.

Examples of palm concessions illegally operating in forest areas have repeatedly been exposed by NGOs. Only last month, a Rainforest Action Network (RAN) report found that illegal oil palm plantings in Sumatra’s Rawa Singkil Wildlife Reserve were supplying brokers selling to palm oil mills that in turn supply major palm oil traders involved in the supply chains of global snack-food brands.

Rawa Singkil holds the “most intact and most valuable areas” of Sumatra’s 2.6 million hectare Leuser Ecosystem.

One such palm oil mill – PT. Global Sawit Semesta – was identified by RAN to supply or have supplied major traders Golden Agri Resources (GAR) and Musim Mas, while another – PT. Samudera Sawit Nabati – also supplies GAR.

RAN research found that “Unilever, Nestlé, PepsiCo, Mondelêz, General Mills, Kellogg’s, Mars and Hershey all list PT Global Sawit Semesta and PT Samudera Sawit Nabati” as suppliers.

All of these companies have policies pledging zero-deforestation in their supply chains, leading RAN to conclude that its research highlighted “a major failure of the implementation efforts conducted to date by these companies.”

Image on homepage shows deforestation in the Tanah Merah project in Papua, Indonesia. Image by Nanang Sujana for Earthsight.