Dakota Wolff06/05/2015Geography 465/565: Environment and DevelopmentInstructor: Derrick Hindery

How The Palm Oil Industry is Destroying Indonesia

Worldwide consumption of palm oil is massive, and this demand for pam oil has

driven a culture of corruption, devastation, and death for the rainforest and wildlife of

Indonesia. Indonesia is now being deforested at a faster rate than any other country in the

world, and this is due to one product, which is used in about 50% of our supermarket

products: palm oil. The scale of rainforest devastation in Indonesia has been so

incredible, that it now annually almost doubles (840,000 hectares vs. 460,000 hectares)

the amount of deforestation in the Amazon, which is four times as big (Margono, 2014).

This rainforest deforestation is due to the all too common practice of “slash and burn”

deforestation, where bulldozers and men with chain saws cut down the forest, and when it

has been cut, they set fire to it in order to completely clear the area, and prepare it for the

next desired crop. This raises a lot of major issues which I will delve further into later,

but a few of which are that the smoke that comes from burning this land causes massive

amount of carbon dioxide to be released into the air. Pollution from these burn sites affect

major cities hundreds of miles away. People and animals are either killed or relocated

when this deforestation begins. Many people are trapped into a cycle of quasi slave labor

on their former land. Much of the land being deforested is done so on land where it is

illegal to do so, but corruption in the government, and very little regulation allows for

palm plantations to built anyway. Much of the literature involving this heated and

controversial topic, has been centered on notion that palm oil production is set on a path

to continue in the unsustainable and devastating manner that it has so far, instead of

possible solutions. It is unfortunate that until we find an alternative product for palm oil,

which can also come at a cheap price, we will in all likelihood continue this trend. The

question I will be seeking to answer throughout my paper will be: What factors have

influenced and perpetuated the spike in production of palm oil in Indonesia and how has

this created an environmental and social disaster for Southeast Asia?

The research methods I used, and will be referring to include both qualitative and

quantitative data and analysis. My qualitative methods come from online interviews as

well as documentaries featuring interviews with people directly affected by the palm oil

industry in a multitude of ways. I will also show multiple angles to the development of

the palm oil industry by referring to articles featuring government officials, as well as

people involved on the business side, to help show how growth is occurring at the

expense of the environment and the people. Ultimately the goal is to show the wrong

doings of the government as well as the palm oil producers, but only by showing what

drives these government officials, and the palm oil companies, can we understand why

they continue to harm the environment and people. Quantitative analysis will be

conducted through research involving the spread of palm oil plantations and deforestation

over time. Research will come from peer-reviewed articles, as well as other online

resources. I will include global trends in palm oil production and price to show how the

global economy is reacting to the increased demand in palm oil. By using satellite

imagery I will be able to show the extent of deforestation, growth of palm oil plantations,

and magnitude of pollution over time, and by doing so paint a picture of how large an

industry this is, and just how devastating it has been, and will continue to be.

Figure 1: Indonesian landform, intact and degraded primary forest extent and loss.

Global demand for Palm oil is growing at an incredibly high rate, the FAO (food

and agriculture association) predicts that global demand for palm oil will double within

the next five years and triple by 2050 (USDA, 2007). Rules of economics dictate that

with all of this demand, supply needs to keep up, or prices will rise, and with 50% of our

supermarket products containing palm oil, this would be an absolute disaster for

consumers. The country that is taking on the brunt of this production is Indonesia. Just

within the decade of 1994-2004 Indonesia’s production went up 400% and surpassed

Malaysia in 2006 as the highest palm oil producing nation, and from now until 2030 they

hope to double production (Scientific American, 2012). The nations consuming the vast

majority of palm oil are the United States and Europe, but China and India’s growing

economies are only further driving the demand for cheap palm oil. Often the effects of

palm oil production are not felt on the side of the consumer unless the prices go up, but

the negative effects for Indonesian citizens, and their environment have been tremendous.

In order to plant palm oil trees you obviously need fertile tropical land, and

Indonesia has an abundance of that. With the high revenues that the government can get

by partnering with palm oil producers, there is a clear incentive to give up this land for

production purposes. This is where the issues start to arise. There are many people who

live off of this land, which is now being sold to different firms to be destroyed and made

into plantations. The government and palm oil industry argues that the amount of jobs

coming from the plantations should out way the encroaching of palm oil onto the land

previously used by rural people for food production, and lift people our of poverty(Vice

news, 2015). An analysis of this would show otherwise, while 61 million rural people

rely on this land as their source of food and income through rural farming, only 1.4

million are employed by the palm oil industry (Perera, 2014). Furthermore many of the

encroaching plantations, which are taking over indigenous land are doing so illegally, but

by colluding with the government they are able to find loop holes and rig the system to

their advantage. A moratorium was placed on land for new plantations in 2011, this

looked like a step in the right direction for land preservation but, what this moratorium

actually did was disallow any company with a new license to plant on untouched land.

Companies who had long before gotten their license, now got free reign on whatever land

they pleased. This ended up having an opposite affect, because all of the companies with

these long standing licenses now had to race one another to get as much land as possible.

Once peoples land gets taken over there is very little they can do to fight back or

regain their land. Women, indigenous people, and subsistence farmers are the hardest hit

by these new changes, because they lose their land, their livelihood, and often times

aren’t incorporated into the new economic system they get thrown into, because not

everyone can work on the palm oil plantation. If they try and fight back, they are often

met with violence, and in a few cases people have been killed. On the 14th of March, and

the 28th of February 2014, two separate incidents occurred where an individual was killed

while protesting the expansion of palm oil fields. Many people are stuck with no choice,

and overnight can go from being a rural farmer to a forced laborer on the plantation

(Rosenthal, 2014). The US department of Labor has found that many workers are either

children or forced laborers, and often immigrants who are forced to work, or threatened

with deportation (USDA, 2012). In one case profiled in Bloomberg Businesweek, a man

named “Adam” told his story of being forced to sign contracts which paid them only

5USD, per day. But later he was told that he wouldn’t actually be paid for two years, and

that he and other workers would have to get loans from the company to pay for food and

health care. While he was working his identity card, school certificate, and deed to his

home were taken, and he was told he wasn’t allowed to leave with out permission, and

that if he or anyone did they would be beaten (Skinner, 2011).

In an interview conducted by a social and environmental justice group called

Films4Forest, a man named Tumenggung Tarib spoke about his experience as part of the

Orang Rimba tribe, who’s land has essentially been taken over by a palm oil company.

He talks about how nobody in their tribe was consulted before they began to build roads

in order to transport lumber out of the area. The only warning that was given was when a

company spokesperson came and told the tribe that the road being built was in their best

interest. After this they began clearing and planting palm oil trees and before he knew it,

parts of their land were being destroyed, and there lives were dramatically changing. He

goes on to talk about how his tribe and their people have changed since the company

came to their land. He spoke about how his people have become very fragmented,

because now that there is less forest for them to live off of, some of the tribes people have

gone to live in a village created by the company. Tarib argues that this is a bad thing,

because they don’t know how to read or write, so they have to steal and become criminals

to survive. People who stayed began to get sick because there was less food so they were

eating unfamiliar food, which gave them diseases, and Tarib says some 50 people died.

When the tribe’s spokesperson talked to company officials on the land, they said that they

would have to go talk to the president, because that’s who gave them the land. The

practice of simply overtaking people’s lands in Indonesia by Palm Oil companies is very

common. The indigenous people don’t have any legal stake to the land on which they

live, and their tribal boundaries are often marked by landmarks such as mountains, so

boundaries are very subjective. Like Tarib said, their way of life was destroyed by these

companies, and there wasn’t anything they could do about it, because integrating into a

village and living a life revolving around working for money was too foreign of a concept

for them, so they resorted to stealing, and in doing so criminalized their own people. This

series of events wherein a company takes over part of the land with out consolidation

from the indigenous people, justifies it by promoting the economy and new jobs, and then

criminalizes the indigenous people for fighting back, is all too commonplace in

Indonesia. This example was just one of many that can be found describing some of the

injustices on the behalf of the government, and the companies running the plantations.

Although the impacts of palm oil plantation growth in Indonesia are

disproportionately affecting small subsistence farmers, as well as natives living off of the

forest, they are not the only ones being affected. Another major aspect of this

development is the environmental impacts it has on in Indonesia as a whole, as well as

surrounding areas. With the current upward momentum of palm oil production and

consumption, the environmental impacts felt in Southeast Asia will quickly spread

worldwide. Past and current upward trends in Carbon Dioxide levels have been proven to

lead to global warming. The continuing deforestation of Indonesian rainforest and peat

land, will have a major impact on global emissions of Carbon Dioxide in the future due to

increasing demand, and therefore production. Peatland is especially good at storing large

quantities of carbon, far more than other land types that cover Indonesia. Indonesia has

half of the world’s tropical peatland and 84% of the peatland in Southeast Asia, the

burning of this peatland accounts for 60% of Indonesias total carbon emissions

(Dommain, 2014). With the extensive amount of tropical peatland in Indonesia, the

release of this stored carbon is a major concern for those interested in climate change and

carbon emissions in the atmosphere. Although illegal, the clearing and burning of

peatland has continued to occur by companies seeking further land for palm oil

production. Unlike fires associated with black smoke, such as forest fires on the western

border of the United States, tropical peat fires smolder for months underground and are

very difficult to stop, and can even last years whilst constantly emitting carbon into the

atmosphere. Due to these facts Indonesia has become the third largest producer of carbon

emissions in the world behind the United States and China (Vidal, 2014). With very little

regulation or oversight onto these plantations by the authorities or government officials,

or corruption and bribery by companies of governing bodies, the continuing clearing and

burning of peatland will undoubtedly continue.

Not only are the Carbon emissions bad for the environment as a whole, but the

smoke being released from the fires has caused immediate and more pressing health

concerns for those living in Indonesia both in close proximity to the fires and even

hundreds of miles away in neighboring countries. In 2012 the WHO estimated that seven

million deaths worldwide could be attributed to bad air quality, the majority of those

deaths coming from citizens in Asia and particularly, Southeast Asia. Previous reports by

the WHO have been far more modest when it comes to death caused by air pollution, for

example in 2008 they found that only 3.2 million deaths could be attributed to bad air

quality (WHO, 2012). What my research suggests is that a major reason for this spike in

deaths caused by poor air quality is due to continuing demand for palm oil and in turn,

driving further slash and burn agriculture in Indonesia. The poor air quality leads to

fatalities attributed to some of the most common diseases on earth, they include; heart

disease, lung cancer, and stroke. A thick haze of smoke and other pollutants blanket

Singapore, Cambodia, Malaysia, and Thailand, which are causing these deaths to occur.

When looking at satellite images it is easy to see where these clouds of smoke are

originating. NASA released photos of Indonesia where you can easily pinpoint the

locations of fires. It shows some 3,000 fires burning within Indonesia, many of them

concentrated within the province of Riau, which just so happens to be the main hub for

Sumatra’s palm oil industry (NASA, 2014). Due to the proximity of the towns, cities, and

villages in Riau to the fires, they are the ones who have to endure the most concentrated

forms of this air pollution. Unintentionally, other countries and cities also have to deal

with the pollution, but especially Singapore. Winds travel west from Riau to Singapore

carrying with them thick smoke which envelopes Singapore.

Figure 2: Satellite image of Sumatra, Malaysia, and Singapore. With locations of illegal

land burning shown in red.

In the summer of 2013 it got so bad that the Indonesian government issued a formal

apology to Singapore. The pollution levels reached that which is considered “very

Unhealthy”(Wilson, 2013). Although this occurred during the dry season of June through

September, when there is a legal ban on burning, many farmers choose to set their land

on fire to prepare it for the next season anyway. This shows a clear lack of oversight on

the part of the Indonesian government who control and regulate the land. This proves

either how important the palm oil industry is to the government, or how incompetent they

are at enforcing the laws that they enact.

Although the palm oil industry is absolutely destroying the environment and has

caused untold amounts of death, palm oil is in fact an incredibly efficient crop which

could in theory, and if done correctly thwart further deforestation. Palm oil is by some

estimates ten times more efficient than other vegetable oil production (Vice, 2015). Due

to this fact it is hard to say that palm oil production is inherently bad for the environment,

although the way it has been done so far is undoubtedly that. If done in an

environmentally friendly way, which would include, better oversight from the

government to control and regulate where plantations are formed, as well as regulations

on labor and indigenous impact studies to ensure fair treatment for all, then palm oil

production could save thousands of acres of rain forest worldwide. Palm oil production

has within the last few years outrun demand for the product, at least in the short run, so a

scale back from the government could be possible. The fact of the matter is that this is not

happening and doesn’t look to be anywhere close to happening. The priority within the

government of Indonesia is to grow their economy, and the best way they can do this is

through the most efficient and largest means of palm oil production. This often includes

quasi slave labor, slash and burn agriculture, as well as the acquisition and destruction of

subsistence farmer and indigenous peoples land.

Based off my research I have made these conclusions, Indonesia is one of

the fastest growing economies in the world, thanks in no small part to the production and

export of Palm oil. Global demand for palm oil is at an all time high, and is predicted to

grow continuously over the next 30 years. The government and private sector could not

be happier with this growth, but this economic success has come at a price. The people

hardest hit by the growth of palm oil plantations are the small farmers and subsistence

farmers, as well as the indigenous peoples whose land is being taken over. They often

have no other choice but to work for the palm plantation or move to a village where they

struggle to integrate to their unfamiliar surroundings. Very little oversight or regulation

on the behalf of the government has allowed plantations to overrun people’s lands, cut

and burn precious swaths of rain forest, and release thousands of tons of Carbon into the

air. Collusion and bribery between the palm oil companies and the government has

allowed plantations to grow onto land where it is technically illegal. The burning of land

to ready it for cultivation has caused health and environmental problems that can be felt

from a local, to worldwide scale. The massive release of carbon from peatland in

Indonesia has brought international attention to the palm oil industry in Indonesia, who is

now the third largest producer of carbon in the world. This coupled with the fact that the

pollution creates a toxic haze, which has covered parts of Southeast Asia, has created an

international debate about how palm oil is destroying our environment, and inadvertently

killing millions of people through respiratory diseases. With all of the media coverage

surrounding the horrible environmental impacts of the palm oil industry, as well as the

illegal actions taken by some plantations, a few major product labels have chosen to

distance themselves from the shady side of the palm oil industry, and only buy from

regulated fair trade plantations. The problem with this is the actual processing of the palm

oil is done very large factories where multiple plantations, some of which could be

obeying regulations, and some could not, so a company could say they are buying from

one plantation when in fact it could partially be buying from multiple plantations. The

palm oil industry has been a disaster for many people, but it is far too profitable for the

Indonesian government, and the corporations who work with them, to diminish the rates

of production, or to enact any real regulations on where plantations are made. In the

future plantations will continue to expand, pollution will continue to rise, and people will

continue to consume palm oil.

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