The realities behind managing a sustainable palm oil plantation

Agriculture. What comes to your mind when you first see that word? Is it farming, crops or hard manual labour under the hot sun?

For many born and bred in modern cities, they might not know where their food comes from before it reaches the supermarket shelves. Having worked with farmers for decades, I have a good understanding of where our food comes from and the work involved in making it.

I am the CEO of Sinar Mas Agribusiness and Food for West Kalimantan plantation areas. I work with palm oil growers to make sure what we grow is safe, healthy and sustainable for consumers and our employees. In recent years, palm oil has been on a journey to become more sustainable and transparent, debunking common misconceptions that have been created about this crop. As a plantation manager, I’m part of this journey and am proud of what we have already achieved but there is still a long way to go.

At our company, we have developed a set of best practices that are in line with Roundtable on Sustainable Palm Oil (RSPO) and the United Nations Sustainable Development Goals (UN SDGs). Our Sustainability Reports are based on the Global Reporting Initiative (GRI) Standards Reporting Guidelines (Core Option). However, down at the plantation level, execution of these standards is not easy. As with all types of agriculture, consumer demand for increased productivity is often in direct conflict with environmental sustainability. Our employees work tirelessly to ensure we are meeting market demands and not compromising our environment.

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The company’s sustainability journey (as of February 2018).

Higher yield with no deforestation

One of the goals in today’s agriculture system is to produce more food without causing harm to the environment and using more land. We share the same goal in our business, to provide for consumers as well as to empower farmers. That’s why we invest heavily in R&D to improve palm oil yield.

Through years of research, we officially launched two new non-GMO, extremely high-yielding planting materials in 20173. Eka 1 and Eka 2 are capable of producing yield more than 10 tonnes per hectare per year of crude palm oil (CPO), compared with the national average of 3.5 tonnes. Higher yield will reduce the need for land expansion and deforestation. With limited agricultural land, the target of producing more food with less area will play a very essential role in progressing sustainable agriculture.

Golden Agri-Resources (GAR), Sinar Mas Agribusiness and Food’s parent company, is one of the first major agribusinesses in the world to publish a Forest Conservation Policy in partnership with The Forest Trust (TFT). We implemented this because we believe in the importance of conservation and in our ability to produce sustainable palm oil without negative impact on the environment. Since 2011, we have been committed to implementing the requirements in our own plantations and we’re also progressively moving beyond to managed estates, and more recently throughout our supply chain.

To ensure that those maintaining the plantations are doing so in the best possible way, we run workshops to educate workers on how organic fertilisers produce healthier crops, improve yield and increase soil fertility without contaminating land and the environment. We’ve developed standard operating procedures that strictly regulate the use of fertilisers. These guidelines look at how fertilisers should be tailored to the texture of the soil and its capacity for retaining nutrients, how they should not be applied during periods of heavy rain, and that there should always be an appropriate interval between applications. We also recycle palm leaves and other organic products to increase the fixing capacity of soils.

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A farmer trainer explaining to smallholder farmers the right way to apply fertiliser.

Dealing with climate change

For growers of all crops, the impact of a changing climate is a very real threat. Realising our own role in reducing greenhouse gas emissions (GHG), we make it our priority to look for ways to mitigate the impact using the best available technology.

In addition to our work on the plantation, we have implemented several measures along our supply chain to reduce emissions. For example, bio-digester facilities are set up to capture waste methane gas in Central Kalimantan at our Hanau, Sungai Rungau, Perdana, and Semilar mills. The seven methane capture facilities can collect methane gas and use it as an alternative energy source to generate electricity for GAR’s operations. The estimation is encouraging: through methane capture and avoidance of the use of fossil fuels, we manage to reduce 40 to 55 percent of operational GHG emissions where we have methane capture facilities.

Obstacles to sustainability off plantation: independent farmers

About 40 percent of palm oil plantations in Indonesia are managed by independent smallholder farmers. Many independent smallholder farmers do not possess quality seeds and lack knowledge on sustainable agronomic practices. Some farmers face challenges such as low productivity due to poor quality seeds or older oil palms. Lower yield and poor quality translate to lower incomes for farmers, which makes a sustainable living all the more difficult. This is when smallholder farmers resort to clearing land in order to plant additional crops to generate more income.

These are just some of the realities of managing a sustainable palm oil plantation. There continue to be many areas for improvement across the entire industry, but we are making progress every day. Sustainability is a journey, not a destination. The continuous support from our public and private partners will help to sustain our efforts as we move forward with more responsible practices.

About the author: Susanto Yang is the CEO of Sinar Mas Agribusiness and Food (GAR’s business operating in Indonesia) for West Kalimantan plantation areas.

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