University of Göttingen: banning palm oil is no solution 

A new study by researchers at the Department of Agricultural Economics and Rural Development at the University of Göttingen sheds light on the environmental, economic, and social consequences of palm oil production. The researchers examined evidence from different parts of the world and studied the case of Indonesia in detail. Conclusion: banning palm oil would not be a sustainable solution because much more land would be needed for cultivation. It would also have negative economic and social consequences in the producing countries.

The main findings

  • The rates of deforestation resulting from the expansion of palm oil production differ depending on the geographical context. In Africa, for example, the rates are much lower than in Southeast Asia.

  • In Latin America, oil palm has not been the main contributor to deforestation. While overall deforestation rates have been high in this region, about 80% of the expansion in oil palm cultivation did not occur at the expense of forests; it occurred on abandoned pastures and on land that had been used for various other purposes.

  • Although some studies suggest that smallholders contribute significantly to deforestation, this issue requires further research.

  • Knowledge about the effects of oil palm cultivation on biodiversity in regions other than Southeast Asia is scarce.

  • Palm oil is an important contributor to the gross national product in producer countries.
  • Oil palm cultivation has brought significant gains for farmers, labourers, and other people involved in the supply chain. Rural households and communities benefit in terms of higher farm profits, new employment opportunities, and improved rural infrastructure.

  • In the case of Indonesia, the University of Göttingen researchers found that there was a positive relationship between palm oil production and socioeconomic indicators. The researchers studied the situation in the province of Jambi and found that oil palm adoption had, for example, increased people’s calorie consumption and the quality of their daily diet.
  • The researchers found that the expansion of palm oil production in Jambi contributed to a reduction in poverty and gains in economic welfare in both farming and nonfarming households. They said these findings were consistent with recent studies that used nationally representative data from Indonesia.

The University of Göttingen researchers concluded that unsustainable practices within the supply chain need to be tackled through appropriate policies. Developing and implementing sustainable production systems is the way forward, the researchers say, and these are challenges that requiredinnovative research and policymaking. “The goal should be to make palm oil production more environmentally and climate friendly,’’ said one of the study’s co-authors, Ingo Grass.

You can find the full study here and the press release here.