Palm Oil Firm Wants Industry To Postpone Proposed Planting Norms

Malaysia’s Genting Plantations wants an industry body tasked with setting environment standards to postpone a proposed new planting policy that it says may disrupt long-term operational plans.

The Roundtable on Sustainable Palm Oil – a group of planters, consumers and nongovernmental organizations – has included a new policy that requires planters to get community feedback prior to opening up new lands.

Dubbed the New Planting Procedure (NPP), the policy also requires planters to address all grievances prior to commencing operations in a new area, a move that may slow expansion especially in top palm oil producer Indonesia.

Genting Plantation’s sustainability vice-president Chew Jit Seng told Reuters in an interview the planter will support an effort to postpone the policy, initially proposed by NGOs, at an RSPO conference in Jakarta on Nov. 8.

“The Malaysians and Indonesians (growers) are proposing for NPP to be postponed because we need to consult with locals and actually do a field trial to see how it would really work on the ground,” he said.

Chew said the RSPO’s NPP is a groundbreaking rule but it needs to be implemented over a period of time, which could otherwise disrupt growers’ operations when demand for palm oil has been on the rise.

None of Genting Plantation’s operations are presently RSPO certified but planters will be seeking certification starting next year.

Growers in general recognize the importance of sustainability, but say any plans have to make economic sense before being implemented on a large scale, Chew said.

Genting Plantations will lobby for more stringent regulations on consumers buying green palm oil.

At present, there is a lack of demand, which led to much smaller premiums for ecofriendly palm oil than expected.

The premium enjoyed by sustainable palm oil over regular supplies has dropped to around $6.50 per tonne from an earlier promise of a $50 premium, Chew said.

Towards that end, he said Genting and other growers would like to see more rigorous stipulations on buyers to purchase more sustainable palm oil.

“Of the 3.2 million tonnes of sustainable palm oil that has been produced so far, there has been uptake of only about 30 per cent,” Chew said.

Stricter regulation on the deadline for sustainable palm oil users to comply with usage criteria would bolster demand and improve yield, he said.

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