Team:NAWI Graz/Human Practices
Impact Analysis
PROJECT OVERVIEW
Introduction
This report shows an analysis of the impacts attributed by the launch of a bio-synthetic palm kernel oil to the global markets. It will discuss the benefits and disadvantages to the economies in Malaysia and Indonesia where the palm oil industry is very important. To accentuate the importance of this project we will calculate the impacts on the prices of crude palm kernel oil (CPKO) and other products. It is important to have a detailed analysis about the impacts of synthetic biology in every sector. For this reason, we considered about the impact on not only economy, but also on environment and society in Malaysia and Indonesia.
Project Description
In the last decades, the palm oil industry increased on an extreme level and, because of great demand, it still does. The main products from the palm plant, palm oil and palm kernel oil, are not dispensable in today`s society, Because of their characteristic properties, they are widely used in food-, material-, beauty- and fuel industry. The aim of our project: We are working on a way to produce palm kernel oil using microorganisms, especially E. coli. The production of fatty acids and their esterification to triglycerides as energy storage is a natural process in all organisms. We make use of this natural way of synthesis by modifying the expression of fatty acids with appropriate carbohydrate chain length on a molecular level.
Summary of the palm oil industry (2018)
The following is a summary of the current situation of the economy and palm oil industry in Malaysia and Indonesia. These two countries are the two largest producers of palm oil and palm kernel oil in the world (Tab. 1).
In 2017, Malaysia recorded 5.81 million hectares for oil palm plantations, a 1.28% growth compared to last year. The University of Manchester iGEM Team 2013 predicted a limited arable land, however the area used for planting rose by 13.94% from 5 million hectares to 5.81 million hectares [7]. Because of acreage limitations in the future, even with an improvement in efficiency of production of palm oil and palm oil related products, the future supply will not even achieve half of the global demand.
ANALYZING THE ECONOMIC IMPACT
Advantages
The launch of biosynthetic palm kernel oil is thought to have positive effects on the global market of the commodity. To analyze the benefits, we will first give a short insight into the global market for palm kernel oil.
Since 2011 the crude palm kernel oil (CPKO) price have showed a general increase (Figure 1). As can be seen in the figure above, the CPKO fluctuate heavily and there is a dramatic pike in 2016/17. Due to the prolonged drought induced by the El Niño phenomenon in 2015, the production was down by 13.93% and therefore the export of CPKO fell by 13.46% (317.043 tons) in 2016. The reported tree stress induced by El Niño reduced the overall output and led to a higher average price of CPKO [8]. 2011 high CPKO price are related to world supply tightness of vegetable oils and low domestic palm oil stock level during this period [9].
Several factors including world population and income, governments (US/China trade war), demand (demand for energy), financial markets (exchange rates), weather (El Niño) and supply influence the price of palm oil and palm oil related products. Furthermore, the price of other vegetables oils interacts with each other. Since in the last years China is not able to satisfy all of its soybean imports from non-US origins and is likely to shift imports from soybeans to oil palm products, the global palm oil demand will increase. Since 2007 the biodiesel production trebled and is now claiming 18% of the total palm oil usage, but in 2018 the EU decided to ban the use of palm oil in all European biofuels by 2020, which will have strong effects on the future demand [10,11,12]. Such sparring actions between trading nations have negative impacts for the global economy, particularly palm oil producing nations and implicate uncertainties in the global market and stagnation of global trade in the commodities sector [3,8].
Over the past years the global consumption of oils and fats has grown steadily from a level of 155 million tons in 2007 to 214 million tons in 2017. The world average per capita consumption has also grown each year from 23 kg in 2007 to 29 kg in 2017. The growth in population and income will stimulate the future demand. Additionally, the food and industrial demand will see an increased application in the production of food and non-food [10,13]. The reason for the great demand is that palm oil is the cheapest available vegetable oil and is therefore interesting for many different industry sectors. Figure 2 illustrates how the oils and fats production and consumption has changed over the years and predicts future development. Interestingly, the oils and fats production increases linear in contrast to the consumption, which increases exponentially. This signifies a mismatch of demand and supply in the future years and, as a consequence the price of some commodities is likely to increase.
According to recent report, global human population will grow over 9 billion by 2050 and it is predicted, that the food industry will have to produce about 60% to 70% more food in the next 35 years [10]. The University of Manchester iGEM Team 2013 predicted that large volumes of food crops being transferred to biodiesel production. Since the EU plans to ban palm oil for biofuel production, there will be more land for growing crops for food purposes rather than for biofuel production. Nevertheless, the demand for palm oil and palm oil related products further rise and there are many challenges for the palm oil industry like lack of replanting, labour shortage, below potential yields and acreage limitations. Biosynthetic palm kernel oil will may avoid these challenges and support the supply of palm kernel oil. Further, the commercializing of synthetic palm kernel oil will have positive effects on the price, but may also affect other markets.
Disadvantages
The Commercialization of biosynthetic palm kernel oil has also the ability to evoke negative economic impacts on palm (kernel) oil producing countries. Indeed, the production of palm oil and palm oil related products plays an important role on the economy for these countries.
As mentioned above, palm oil and related products secure a relevant amount of income for producing countries. In 2017, Malaysia achieved export revenues of RM 77.85 billion (18.99 billion USD) of palm oil and its products as well as palm kernel oil [3]. This amount is enormous and represents over 6% of GDP [3]. Indonesia has a similar economic situation with export revenues of 18.90 billion USD. To replace this high quantity of income from somewhere else would be a difficult challenge [1]. During the last years, companies have established awareness for their influence on the environment and the founding of biosynthetic palm kernel oil would be an additional risk factor for the palm oil industry.
The outcome of our project may also have the ability to influence the circumstances of the plantation workers. The launch of biosynthetic palm kernel oil may lead to job reductions in the Indonesian and Malaysian palm (kernel) oil industry. Over millions of people from these two countries are dependent on this industry for their living. For this reasons it is important to perceive the possible impact of a biosynthetic palm kernel oil on every conceivable sectors in countries like Malaysia and Indonesia where the palm oil industry plays a significant role.
Long-Term Implications
If the launch of biosynthetic palm kernel oil will occur, countries with a large palm oil industry like Malaysia and Indonesia may struggle to manage the impacts that this project could exact them.
One important question is, how easy it would be to change the crop type after the land was used for palm oil prior or the industry in general. Several studies proved negative impacts on the soil under oil palm plantations. For instance, there are variations in the soil resulting from oil palm trees planted on the soil over years and experiments shown a remarkable influence on soil chemical properties like Nitrogen, Phosphate, Potassium, Calcium and Magnesium status. As a matter of fact, intensive cultivation of oil palms leads to intensive soil degradation and lower the soil fertility status. For this reasons, changing crop type is not that easy, because every crop type needs specific requirements of nutrients, which are very low after the soil is used for oil palm plantations [14,15].
CURRENT PRODUCTION AND THE IMPACT ON THE ENVIRONMENT
In recent years the general public has become very aware of the disastrous environmental impact of palm oil and palm kernel oil production (survey LINK), as it has often been criticized by NGOs and in the food industry, the label “palm oil free” is used for marketing. This was also our main reason to choose the production of a synthetic alternative to palm kernel oil as our project. One of the first steps for our Human Practice work was to research the ecological problems within the current palm (kernel) oil industry, because this allows us to better assess the positive effects our project might have.
Impacts on Environment
To clear the land for oil palms, rainforest often gets burned. Thereby, vast amounts of CO2 get released into the atmosphere. Additionally, carbon that is stored in the ground gets released when converting rainforest to oil palm plantations. This is particularly troublesome in peatland forests in Indonesia. The drainage of peatland leads to enhanced decomposition of organic matter and therefore CO 2 release and other negative changes of the land [17]. As a result, Indonesia is one of the world’s biggest producers of greenhouse gases [18].
The two countries in which the most palm oil gets produced are Indonesia and Malaysia. They alone produce about 250 million tons palm oil per year. This corresponds to more than 14 million hectares of land that is used. Worldwide, there is an area of more than 21 million hectares used for palm (kernel) oil production (Figure 3) [16]. In order to make such huge amounts of land available for oil palm plantations, most of the time tropical rainforest has to be destroyed (sometimes former rubber plantations are used). Another side effect of the enormous demand for palm (kernel) oil is that rubber and cacao plantations can get driven into areas of former rainforest. All this deforestation goes hand in hand with many environmental problems such as soil erosion, air pollution, climate change, and species extinction [17].
Values taken from: FAOSTAT
There are many pesticides used on palm plantations like paraquat dichloride, glyphosate, glyphosate, triclopyr butotyl, glufosinate ammonium, diuron etc. [19]. Additionally to the health and safety issues regarding the workers [19,20] there are also concerns about the environmental impact. Pesticides as well as fertilizers and other chemicals can get into rivers and negatively affect aquatic ecosystems [17,20]
Impacts on Animals
According to Wilcove and Koh “oil-palm agriculture is the greatest immediate threat to biodiversity in Southeast Asia” [21]. On plantations, there is up to 99% lesser tree and plant diversity than in natural forests [17]. Also many mammals like the Sumatran Tiger, Sumatran Rhinoceros, Sun Bear, Pygmy Elephant, Clouded Leopard and Proboscis Monkey and, most infamously, the Orangutan suffer from the conversion from rainforest to monocrops [22,23]. It’s estimated that from the approximately 288,500 Bornean Orangutans in 1973 there will be only 47,000 individuals left by 2025 [24,23]
The importance of palm oil as a sustainable source
Since the population has become more aware of the impacts of palm oil cultivation, more and more companies attempt to obtain their used palm oil from sustainable sources. Unilever, a big multinational company for food, household goods and hygiene products, purchases nearly 3% of the global palm oil production in 2016 (1.5 million tonnes). Buy the end of 2019, Unilever plans to buy 100% physically certified palm oil and its derivatives [25,26].
The Roundtable on Sustainable Palm Oil (RSPO), the currently prevalent certification system for sustainable palm oil, is criticized by many NGOs like Greenpeace [27]. As the University of Manchester iGEM Team 2013 mentioned, the supply options allow companies to use only a little amount of CSP(K)O (certified sustainable palm (kernel) oil) and claim to support sustainable palm oil [7]. Additionally, studies indicate that the RSPO is involved in deforestation and destruction of peatlands for the development of oil palm plantations, because its standards do not ban these [7,27]. However, more than 250 organisations worldwide have signed a declaration in which they criticize the RSPO certification as “greenwasing” [28].
Because of the need for a truly sustainable palm (kernel) oil to reduce environmental problems and the not transparent certification systems, a biosynthetic alternative to palm kernel oil may be the answer.
OUR PROJECT AS A QUESTION OF MORALITY
The environmental destruction that goes along with palm (kernel) oil production (as described here LINK) was what initially motivated us to develop a synthetic alternative but we knew that there are also other factors to consider. As the University of Manchester iGEM Team 2013 has outlined in their Human Practice work [7], there are millions of people in Indonesia and Malaysia involved in the palm oil industry and the introduction of a synthetic alternative might have a negative impact on them, such as forcing them into unemployment. Building on team Manchester’s work, we wanted to look into the possible ethical consequences of our project. We went on to research the situation of workers on plantations and found that there exist serious ethical problems within the current palm (kernel) oil industry.
Current situation
In an effort to look into these problems, we’ve contacted the non-governmental organization Amnesty International, which focuses on human rights. They provided us with a very informative report from 2016 in which they investigated labour exploitation on palm oil plantations in Indonesia. The investigations brought various human rights abuses to light, such as forced labour, child labour, gender discrimination as well as exploitative and dangerous working practices. The report focuses on plantations that provide palm oil to Wilmar International Ltd., the world’s largest processor and merchandiser of palm oil and palm kernel oil. The quintessence of the report was that these human rights abuses aren’t isolated incidents, but a result of the systemic business practices that are used on these plantations. The payment for example is very low and based on piece rates rather than hours worked. This is very problematic, as there are severe penalties if these targets aren’t met even if the workers had to work overtime. This often leads to child labour, because the children have to help their fathers in order to avoid these penalties or to help get bonus payments. Another problem is gender discrimination. All of the harvesters are men and most of the workers in the plant maintenance units are women. The women often are employed as casual daily labourers rather than permanent, which leaves them without certain social security benefits. They are also under the constant threat of being suspended for one or more days if they fail to meet their target. As for dangerous working conditions, among other things there’s a problem regarding the safety of workers handling the herbicide paraquat dichloride. Amnesty International found that workers often aren’t informed enough about the risks associated with the chemicals and the protective equipment often is insufficient or missing. In our Interview with Marianne Klute she also described most of the above mentioned human rights issues [19,23].
What is the best way to help workers and how would the introduction of a synthetic alternative to palm kernel oil impact them?
In “Workers of the Palm Oil Industry - Exploitation, Resistance and Transnational Solidarity” a paper published by Stiftung Asienhaus in 2016, the authors argue that the best way to tackle both the environmental and worker exploitation issues is to support local resistance/activist groups. Helping the workers achieve better working conditions such as better pay would result in less productivity per worker (because currently they have to work so many unpaid overtime hours or get help by their families in order to meet the targets) [29]. Hence, more workers would have to be employed. A campaign against pesticides would also result in more jobs, as the alternative is manual labour (grass cutting, weeding, mulching). The more environmentally friendly solution is therefore also better for the workers.
Based on the conclusion of the University of Manchester iGEM Team 2013, the purpose for our project as we envision, is not to completely replace natural palm kernel oil (as this would threaten the existence of millions of people) but rather supplement it and make further deforestation obsolete. In this scenario, people who are currently working in the palm (kernel) oil industry wouldn’t lose their existing jobs. With measures taken as suggested in “Workers of the Palm Oil Industry”, the working conditions of these people could improve and at the same time even more people could be employed at the already available plantations. This way, the negative consequences of the development of a synthetic palm kernel oil alternative can be minimized.
CONCLUSION
This essay gives an insight into the current economic, environmental and ethical situation in the palm oil industry and the possible impact of a biosynthetic palm kernel oil alternative. It is important for us to consider as much consequences as possible to know the full impact, because we take responsibility for our project.
As previously stated, our project is able to have positive and negative impacts on the economy of palm oil producing countries. On the one hand a biosynthetic product may have positive effects on the price, but on the other hand some countries like Indonesia and Malaysia are dependent on their large palm oil industry.
Nature suffers enormously under the current palm (kernel) oil industry as it leads to deforestation, release of greenhouse gases, water pollution and habitat loss for endangered species. A palm kernel oil alternative could make further deforestation obsolete and therefore save tropical rainforests and therefore be more environmentally friendly.
As this industry is such a big factor in these countries’ economy, the launch of a palm kernel oil alternative might threaten the existence of millions of people who are currently working there. However, there also exists a big problem regarding labour exploitation. The best way to tackle these issues is to support local resistance/activist groups, because in this case, working conditions could improve and even more jobs could be created and the negative impact of our project could be minimized.
We support the suggestion of the University of Manchester iGEM Team 2013, to supplement natural palm (kernel) oil rather than to substitute with a biosynthetic alternative. IN conclusion, we clearly reveal many negative implications caused by the palm oil industry and we strongly believe that our project might change things for the better.
BIBLIOGRAPHY
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[12] Ellis-Petersen Hannah. (2018, April) The Guardian. [Online]. https://www.theguardian.com/world/2018/apr/26/how-palm-oil-ban-has-made-the-eu-a-dirty-word-in-malaysia - last visited: 10. September 2018
[13] R.E.A. Holdings PLC. (2016) R.E.A. Holdings PLC. [Online]. http://www.rea.co.uk/markets/oils-fats/world-consumption-oils-fats - last visited: 10. September 2018
[14] Guillaume Thomas , Holtkamp Anna Mareike , Damris Muhammad , Brümmer Bernhard , and Kuzyakov Yakov , "Soil degradation in oil palm and rubber plantations under land resource scarcity," Agriculture, Ecosystems and Environment, vol. 232, pp. 110-118, 2016.
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[19] Amnesty International, "The Great Palm Oil Scandal," Amnesty International, London, 2016.
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[21] WilcoveS David and Pin Koh Lian , "Addressing the threats to biodiversity from oil-palm agriculture," Biodiversity and Conservation, vol. 19, no. 4 , pp. 999-1007, 2010.
[22] Say No To Palm Oil. (2018) Say No To Palm Oil. [Online]. http://www.saynotopalmoil.com/Whats_the_issue.php - last visited: 18. September 2018
[23] iGEM Graz, Interview mit Marianne Klute, August 2018, Organisation: Rettet den Regenwald.
[24] Ancrenaz M. et al. (2018) The IUCN Red List of Threatened Species. [Online]. http://www.iucnredlist.org/details/17975/0 - last visited: 18. September 2018
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[26] Unilever. (2016, May) Unilever. [Online]. https://www.unilever.com/Images/unilever-palm-oil-position-paper-may-2016_tcm244-481753_en.pdf
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[29] Pye Oliver , Daud Ramlah , Manurung Kartika , and Siagan Saurlin. (2015, March) Asienhaus. [Online]. https://www.asienhaus.de/archiv/asienhaus/kattermann-stiftung/user_upload/Palm_Oil_Workers_-_Exploitation__Resistance_and_Transnational_Solidarity.pdf
[30] Malaysian Palm Oil Board. (2018) Economics & Industry Development Division - Malaysian Palm Oil Board. [Online]. http://bepi.mpob.gov.my/index.php/en/statistics/price/monthly.html - last visited: 17. September 2018
Integrated Human Practice
Survey
Codecheck is an app which allows everybody to gain insight in the chemical compounds of lots of different products, mostly cosmetics, and presents easy to understand explanations as well as warnings of questionable ingredients. Furthermore, the app got a news-feed, which frequently updates its users about lifestyle topics as beauty and super foods, but also about more serious things like environmental problems, recycling tips, veganism, air pollution and finally the palm oil problem. Based on this foundation, we got in contact with Franziska Grammes, head of scientific communication and Dr. Mandy Hecht, head of scientific management, and talked about our project, how we had planned things in the early stage and planned to integrate end-user’s opinions. Once again, we got told that GMOs might be piquant topic for the food and cosmetic market, and that we must ensure that no leftovers would be in the final product.
However, we also wanted to gain some insight into a special group of consumers: the conscious consumers. We knew the general tenor of the genetic engineering discussion was bad, but how about the people who dig deeper into things like the Codecheck users?
For the creation of the survey, we carried out a test run at “Die lange Nacht der Forschung”, a special event where the public is invited to visit research groups at universities and museums all around Austria. There we talked with about 100 people about our alpha survey and tried to improve the questions in consideration of the occurring reactions and occasionally misunderstandings. After that night, we discussed our ideas with Codecheck and created a final draft with their help.
To sum up, we learned a lot about the target group of conscious consumers and gained knowledge about the need for information among a very interested part of consumers. For further steps we need to intensify the clarification on prejudices about genetic engineering.
Stearin
We also talked with Stefan Thomann from the European Candle Association ASBL. He told us about the interests of candle manufacturers and their need for stearin. As our project not only esterifies fatty acids, but also tries to produce them, we should set another focus on this promising application for the candle market. As Mr. Thomann told us, the most important qualities for usage in candles are the smell, melting point, combustion point and soot. Candles are a lifestyle product that’s why colour and smell are the two most important qualities. If we try to produce stearin, it has to be as colour and smell neutral as possible. The price is also an important point. So a scale-up would be very interesting for potential investors from the candle sector to predict the price coverage. At the time the main resource for candles is mineral oil, so if we might be able to create an alternative source for stearin, we would also have an impact on the fossil oil market. Through this interview, we learned more about the importance of lifestyle products and another application for a possible outcome of our research. As a result we added another task to our project: the biosynthesis of stearic acid in yeast.
FFoQSI
As we are an Austrian Team, we naturally were curious about the point of view of researchers on the interface between science, industry and commerce.
FFoQSI (short for Feed and Food Quality Safety and Innovation) is an Austrian research association in the sector of the holistic value chain of food and feed. In cooperation with various partner companies they search on topics in demand of the needs of Austria’s economy. We talked about the future perspectives, economical influence on Austria’s native oil market and consumer acceptance for applications in Austria, but also about the bad image of GMOs and how to get rid of prejudices.
Of course, we also talked about quality management and the value of certificates. On this point transparency became a very important topic in the interview. Jürgen Marchart, the managing director of FFoQSI, explained to us how important a comprehensible workflow and in this way secured quality standards are. Certificates might never be as revealing as a transparent production policy. Furthermore, Mr. Marchart told us about the importance of marketing. We learned that it is not as important to produce the cheapest oil, if we have good quality, work transparently and environmentally friendly. In addition, we got encouraged to go on with resolving misunderstandings about the bad reputation of GMOs and the idea of certification and labels, although it will be a stony path.
Detergents
One of the main uses for palm kernel oil - and therefore a potential field of application for our synthetic alternative - is the production of detergents (1). For this reason it was important to us to get in contact with companies in this field to gain more knowledge and to know if companies would be willing to use our product. Hollu Systemhygiene GmbH is an Austrian producer of washing and cleaning products. In an interview with Benjamin Göllner of the company’s science department, we talked about the use of palm kernel oil in the production of cleaning products, GMOs, palm (kernel) oil certifications, environmentalism and our project. In his opinion, biotechnology will become more relevant in the production of detergents in the next decades and he doesn’t see a problem with the use of GMOs in this industry (as opposed to the food industry for example). However, it would have to be proven that the synthetic palm kernel oil is more environmental friendly that the natural oil.
This interview confirmed that there is a potential market for synthetic palm kernel oil and it further encouraged us in our work.
(1) Meo Carbon Solutions “Der Palmölmarkt in Deutschland im Jahr 2015 Endbericht”, Köln 2016
Biofuels
In our initial research we found that in Germany, the biggest portion of imported palm oil (45% in 2015) is used for energy. Palm Kernel Oil is hardly used in this sector however. (1)
We reached out to Austrian and German biofuel companies in order to learn more about the use of palm oil and palm kernel oil in this industry. Biodiesel Kärnten GmbH doesn’t use palm oil for their biofuel production, but they kindly provided us with a report on fuel from the Austrian Environment Agency. According to this report no palm oil is used for biofuel production in Austria, but imported HVO (hydrotreated vegetable oil) that is used as biofuel, is mainly made from palm oil.(2)
The VDB (Verband der Deutschen Biokraftstoffindustrie) is an organization that represents German producers of biofuel vis-à-vis politics and general public on a national and European level. Wolf-Dietrich Kindt from the VDB helped us to gain more information about the use of palm oil in the German biofuel production by answering our questions. Our team learned that the reason why palm kernel oil isn’t used for biofuel production is the higher price and drawbacks in handling in comparison to palm oil. We also gained more insight into the palm oil certification standards that need to be met for biofuels in the EU and we were told that the use of palm oil in the EU is likely to become phased out in the next years.
Thanks to these conversations, we knew to exclude biofuel from the potential applications of our project.
(1) Meo Carbon Solutions “Der Palmölmarkt in Deutschland im Jahr 2015 Endbericht”, Köln 2016
(2) Bundesministerium für Land- und Forstwirtschaft, Umwelt und Wasserwirtschaft (BMLFUW) “Biokraftstoffe im Verkehrssektor 2017 Gesamtbericht”, Vienna 2017
Plantation owner
The ethical aspects of our project are very important to us. We thoroughly looked into the working conditions on oil palm plantations and thought about the possible consequences of our project on the people involved in palm (kernel) oil production. Additionally to literature research, we were able to conduct an interview with an oil palm plantation owner from Malaysia. He asked us to keep him anonymous though, as he’s afraid of getting in trouble for legal reasons and we respect his wish. We’ve learned a lot about the Malaysians’ point-of-view in regard to palm (kernel) oil, environmental and economical issues from this interview. In contrast to Europe, it seems to be that there isn’t really that much of a concern about deforestation, species extinction and the like.
Our interview-partner didn’t seem opposed to our project and thinks that Malaysians will be accepting of it. The University of Manchester iGEM Team 2013 concluded in their Human Practice work that the best way to avoid negative consequences for the economy of the palm (kernel) oil producing countries would be to patent the project and give patent licences to these countries (1). In our interview however, the plantation owner wasn’t convinced that Malaysia will adept to such change.
We are very glad that we had the chance to get the perspective of somebody who is involved in the palm (kernel) oil industry, as we want our project to be as ethical as possible.
(1) University of Manchester iGEM Team 2013 - last visited: 14. April 2018
Interviews
Interview with Marianne Klute from „Rettet den Regenwald“ (summary)
Marianne Klute is graduated chemist and lived in Indonesia for about 15 years herself. Within the environmental organization “Rettet den Regenwald”, which means ‘save the rainforest’ in German, she is responsible for the Indonesia program. The main activity of the institution is the support of local organizations in concerned regions, both financial and with knowledge. At that, they work together with partners in different countries like Indonesia, Africa and South America but also with other European and local environmental organizations. The biggest strength of the institution: petitions and a wide range; these ‘weapons’ can help and change a lot.
The catastrophe of deforestation: causes, impacts and solutions
The exploration of the rainforest started in 1984 along with the first boom in palm oil consumption. Despite for palm plantations, forest is cleared for wood and paper industry. The deforestation occurred in steps and stands in close relationship to expulsion and destruction of the rainforest.
Since 2000, the political development and the Asiatic crisis played an important role. Enormous pressure of finance institutions to invest in money-spinning sectors, leads to further exploration of resources. As a result, palm oil is ranked in first place as crude product. At this point of time the majority (~70%) of the oil is used in food industry, a small part in cosmetic and household industry and only a fractional amount is used for bio fuels. In 2005, with changes in energy politics and the promise of industrial countries to use renewable resources in propellants, the palm oil use in the energy sector took a big leap. This happened at expense of the rain forest.
The increasing use of palm oil corresponds, among others, with the industrialization of the food industry. Looking around in supermarkets, palm oil is used as raw material in numerous products, especially convenience food products. But the oil is also frequently used in beauty and household products. Increasing consumption behaviour, demographic growth along with mounting production of convenience products, especially in Asiatic countries, leads to a constantly increase of the palm oil demand. Another point to be seen critically is the use of palm oil in the energy sector. The application as bio fuel and the creation of electricity and heat lead to explosively development in palm oil consumption. In 2017 the usage of palm oil in energy sector was ~60 % in the European Union. As the productivity of the oil palm could never be reached by other plants, substitution of the palm oil with other plant oils seems to be impossible regarding to our current lifestyle. For the production of the same amount of plant oil a much larger area of land would be necessary instead.
That’s the point where we as human are coming into play. The rethinking of the population to conscious consume has to be promoted. The only way to change our situation is to adjust our current live style. Simple things, like fresh cooking and the awareness of buying palm oil free products, also cosmetic products, can have a huge impact. We have to be aware that the consequences of deforestation of the rainforest do not only have impact on our generation but also the following ones. We must not forget: the problem concerns the future of our planet.
For the majority of the small holders the palm oil business would not be their first choice for earning their subsistence. The disposal of forest products and natural rubber could be an alternative to palm oil plantations. Beside the independence from the big companies this would also constitute financial independence. The cultivation could be carried out in second-growth forest, there is no necessity for mono cultures and the usage of herbicides could be reduced to a minimum. In addition, depending on the current price level, the profit for selling these products could be higher compared to palm oil. Many of the small holders would prefer other sectors over the palm oil production, yet aren´t aware of alternatives or do not have the financial possibilities for a change. Connection to the market in concomitant with streets and vehicles and corresponding infrastructure are therefore essential.
The biodiversity of the rain forest is unique and extraordinary. For example, the ecosystem of the Leuser national park is the only place on earth where the four big mammals (tiger, rhinoceros, elephant and orangutan) live together. However, the deforestation leaves big wounds behind. Not only numerous are animals deprived of their natural habitats but also countless plants. The orangutan is often only used as flagship for all the threatened species concerned by the deforestation of the rainforest. Besides deforestation associated withdrawal of natural habitats, illegal hunting and selling of the trophies (pelts, ivory, and rhino-horn) overseas is a huge problem. The survival of these threatened species in the wild is doubtful. Different institutions like national parks, rescue centres and research facilities try to constitute rescue for these animals.
Sustainable palm oil? Problems with RSPO & Co.
The development of a certification for sustainability (round table of sustainable palm oil-RSPO) occurred nearly simultaneously with the enormous expansion of oil tree plantations. We were aware of our destructive behaviour and wanted it to keep within a limit. However, the awarding of these certifications should be seen critically. In many cases, thought has only been given to technical aspects like purification plants or filters in the oil mills whereas reflection of the whole system appeared to be difficult to impossible. Conservation of the forest, unknown properties and aspects of human rights like expulsion are often neglected. Not to forget intentionally manipulation and cheating. Certification systems like these make customers and industry believe in sustainability and environmentally friendly work. This process is called “green washing” and plays a significant role in today´s society.
Interview with a plantation owner from Malaysia
Which area of land are you using for growing palm trees? Are you therefore referred to as a small farmer? How long have you been growing palm trees on your land?
Area in outskirts of Kuala Lumpur, far from the business district. I am not a farmer, I own and manage the land cultivation. My workers do the farming. I have been in this industry for more than 35 years. Some of my land I bought with palm trees already planted, others I ordered to be planted by my workers. I bought some land to build houses and develop, but if the land is too rural, I will plant palm oil there first and later use it for development as the urban area grows. This way I can earn money from palm oil now as well as later, in 10 years when I can build houses there.
What do these areas mean to you? Which status do they have in your life? – Basis of existence, tradition, culture, additional income?
It is an investment for me - a side income in addition to my construction business. It is a good source of passive income because I earn money without doing anything. A piece of land with palm oil growing there is worth three times more than the same piece of land without it. The trees grow without me doing anything. Some of my land was passed down to me from my parents, so in a way it is also tradition. In Chinese culture we pass down land to our sons so it stays in the family’s name. When I die I cannot bring it with me, but my son can live a successful life from what I pass down to them. Then I don’t have to worry about my family’s wellbeing when I am gone.
What does cultivation of palm trees mean to Malaysian community in general, other farmers or plantation workers? What role does it play for Malaysian economy?
Is palm oil an important raw material? In which products is it mainly used in Malaysia? Are there any efforts for reducing the consumption?
Growing palm oil is a large part of the Malaysian economy. It is a major export as we sell the palm oil internationally. Some rural communities rely on harvesting palm oil for their day labour. However, more recently immigrants from Indonesia are imported for this labour because their wage is much cheaper. Most businesses have been hiring immigrants for their labour in recent years because of the cheap labour cost. The majority of my workers are Indonesian although some are Malay. In Malaysia we use palm oil for cooking I believe. Mostly for export. Also some cosmetics businesses buy palm oil from me. There is no effort to reduce the consumption. We don’t see a reason why. It supports our local economy and there is money in the business, always demand. Other companies and countries are waiting for us to produce and send our oil to them.
What is your opinion on the clearing of rainforest through industrial companies in order to create space for new plantation areas? What do you think of problems regarding deforestation especially on vegetation, animals (orangutan), environment and indigenous cultures?
We have national park areas, which are protected by the government. I believe the government has a pretty strong control over it. Since palm oil is not a new business in Malaysia, I don’t think deforestation is a current issue as all of the available land is surely already used.
What are the benefits of palm tree cultivation for Malaysia? How are the people profiting from it? What would happen if it would not exist anymore? What role does it play in economy?
We export the oil to earn money and help the Malaysian economy. Mostly we export and make goods to profit from it. Since palm oil plays a significant role in the economy, if it were gone many businesses could not operate and internationally, countries would have to find a substitute for the palm oil they get from Malaysia. You can’t grow it in Hong Kong or Taiwan so where will they get it?
Have you heard about the planed palm oil boycott from the EU? If yes, what do you think of it? What would you think if the prohibition would only regard big concerns and not small farmers?
I haven’t heard about this. I don’t think it will affect Asia very much as the Asian countries will still buy from us. We are closer to them so it is cheaper to ship oil within Asia.
Are the Malaysian people opposed to deforestation of the rainforest? Do you think that big concerns reflect bad reputation on small farmers?
I don’t think Malaysians connect palm oil cultivation with deforestation. The forests haven’t been there anymore for a long time, so it is not a problem for Malaysians.
The aim of our project: We want to find a way to produce palm kernel oil using microorganisms, especially E.coli. Our goal is to retain most of the positive traits from the natural product, which causes the oil to be such an essential resource for industry. With this product it could be possible to produce palm (kernel) oil on an industrial scale and save areas of rainforest.
Have you heard of research concerning biotechnological alternatives to natural plant oils? What do you think of this way to find an alternative to palm (kernel) oil? Which problems or ethical difficulties do you see within these ideas?
I haven’t heard of this before. I think it might be competition for Malaysians palm oil market in the future. It is a good idea, but it will certainly change what our land is worth and how we will use it. Malaysia will have to find a new way to make a living.
Do you think that this kind of research is met with refusal or acceptance by the Malayan community? What do small farmers think?
I think Malaysians will be accepting at the moment. If the economy starts having trouble, then they might change their minds.
Our method of producing palm oil could be used in Malaysia as well. Would you approve this? Do you think that it is realistic and could compete with common oil plantations? Would you favour our method if it is only used to cover the growing demand on palm oil?
I think it is unrealistic that such a strategy would work in Malaysia. Our universities are not as good as in Europe. I don’t think we can train enough scientists to compete with other countries’ markets. I think a new method will take a long time to implement in Malaysia. Change here is difficult as the government support the current palm oil industry very strongly.
There are thoughts on changing the genetic material of the oil tree to gain more fruit. Is this legitimate? Do you see any problems in this way? Could it be possible that big concerns are using it and small farmers are left with nothing?
Currently we use fertilizer with lab-created nutrients to make the palm oil grow faster and produce more seeds. So this might be a similar method. This fertilizer is accessible to everyone, but it is more expensive so small farmers might not be able to afford it. It shows results though, so the fertilizer is a worthy investment. I think the genetic method would have similar effects.
Do you want to add something?
I don’t have anything else to add.
Interview with Wolf-Dietrich Kindt from the VDB
Would you introduce your organisation?
Since 2001 the VDB represents the most important German biofuel producers vis-à-vis politics and general public on a national and European level. The organisation’s current 12 full members and 3 associate members represent 60% of the German biofuel production and they stand for the present and future of sustainable mobility in Germany. The VDB has two main tasks: help shaping the framework for a competitive market and represent the industry.
In order to communicate the positions of the German biofuel producers, representatives of the VDB are constantly in contact with members of the German Bundestag and their co-workers, ministry officials, journalists and representatives of the general public. Due to the increasing importance of EU legislation, members of the european parliament and the european commission are also important contact persons for the VDB.
What role does palm oil play in the production of biofuel?
In Germany, the percentage of palm oil in the biofuel production is in single-digit range
Where is the palm oil obtained from? Are certifications deemed important?
The sources of the raw materials are registered by the federal agency of agriculture and nutrition, please read the according report.
Certifications are required by law. 100% of the raw material is certified. These requirements have existed in the EU since 2011.
What is your opinion on RSPO?
For biofuels the standard RSPO certification is not enough. Only certifications that are approved by the EU commission are allowed. There is a RSPO EU system with different requirements than the standard RSPO system. This can be used, as it fulfils the requirements by the EU. In this system, the criteria are not determined by stakeholders but by European law.
How will the use of palm oil in the production of biofuel change in the future in your opinion?
The EU orders that the use of palm oil will be capped by 2019 to 2023 and then phased out. In this respect, my personal opinion is irrelevant, as everything is regulated by law.
Do you have any concerns regarding the use of palm oil?
Not within biofuel production, as 100% of the palm oil is certified and isn’t sourced from rainforest or other areas deserving protection. For other applications there aren’t certifications required by law - in my opinion, this gap needs to be closed in order to be sustainable.
What is your opinion on genetic engineering?
The VDB has no position on this topic. Personally, I think that genetic engineering is demonized in the public and thereby a lot of opportunities get missed. Similar to the debate about biofuels, many NGOs unfortunately antagonize genetic engineering, even if it could help solving many problems.
Interview with Jürgen Marchart from FFoQSI (shortened version)
Would you introduce yourself and your organization, please?
My name is Jürgen Marchart, I’m managing director of FFoQSI (Feed and Food Quality Safety and Innovation), which is a so called “comet-centre”, partly financed by private corporations of the feed and food sector. We carry out cooperative research projects between companies and academic institutions in all sectors of the food a feed value creation chain. We’ve existed for 1,5 years and have 40 employees, so we are on full extension and have approached our scientific research.
How does your project investigate the matter of palm (kernel) oil?
Actually, there is no running research project to this topic, but everybody’s talking about it. We haven’t got any requests by our partners, so we focus on other projects, but economically and ecologically it’s an important part of discussion.
Which oil properties are of interest for your partners?
I think this is not a question with a general answer, because we have a wide range of partner corporations. By now, there are 36 partners out of national and international agrifood industry, the repertoire ranges from herb production, bread, feed and agricultural machinery. The only connection seems to be the economical compound.
We are working on an alternative produced in E. coli or yeast cells. What do you think about the application in Austria?
Genetic engineering is a very big topic, particularly regarding sustainability and naturalness. We think that the topic of food has become a life style topic by the consumers by now. I think genetic engineering is one of the topics, where open communication and education is priority number one.
Do you think our alternative might be more popular, if it were cheaper or more environmentally friendly?
I would say that it’s depended on the final product. If the final product is a pure life style product, then the economical aspect would be less important. People are more likely to spend money if the quality is high. For industry as ware and for the market it might be interesting, but on the other side, if one can label a product as “organic”, it might be an advantage as well.
You always speak about “lifestyle product”, what do you exactly mean?
Food as lifestyle product, for example “Kaiser Franz Josef Brot”. This is an established brand in Austria. People are willing to spend 8 to 10€. Not only the quality, but also the image is included in the price, ergo this bread is more than just bread. This is the difference between bread as a food and bread as a lifestyle product.
Do you think the local oil market (soy and canola) would be influenced by the introduction of biosynthetic oil?
Logically, of course! However it depends on the market share. The influence might negligible.
What does the future for biosynthetic palm kernel oil look like for the next 20 years?
I don’t know if I’m able to answer this question (laughs). I think it’s strongly dependent on the marketing concept, but I can’t give you a prediction in numbers.
Where do you think might be obstacles in the authorization process?
They might be the same as with Vanillin.
What are your ideas about good quality management by biosynthetic palm kernel oil?
Transparency. I think technical comprehensible processes are way better than bare certificates. I can prove with a method of testing, that everything is ok, it’s ways better than owning 5 certificates, which might get easy forged with pen and TippEx.
Do you know RSPO?
No. (We gave him a short overview)
Do you think if there were more certificates from different organizations, the quality of them would increase and they would be more transparency?
Every certificate, which is not based on technical methods of testing, might be a swindle. Especially with new products one should not make the mistake of not being transparent. Furthermore, it’s not the number of standards to be followed, it’s’ the accountability for the consumer. In doubt I would say, the more standards, the worse it gets.
Would you advice other corporations to exit RSPO?
I cannot answer this question. For me, and I didn’t know this organization before, if it’s common sense, that they do doubtful things, it would be better to have something good.
What do you think the future of the plantations in Malaysia and Indonesia will look like?
Maybe it depends on the success of your project (laughs). Anyway, I believe they will grow on.
Despite all activism against palm (kernel) oil?
I hope not, but I think so.
Do you think the Austrian oil market would notice the impacts?
If not only food, but also biofuels are on the spot, then I think we will get to see way more litres of palm oil in the next years.
Thank for your time!
Summary of the interview with Hollu Systemhygiene
Hollu Systemhygiene GmbH is an Austrian producer of washing and cleaning products. In an interview with Benjamin Göllner of the company’s science department, we talked about the use of palm kernel oil in the production of cleaning products, GMOs, palm (kernel) oil certifications, environmentalism and our project. His company is not using palm oil but he said to us that European commodity supplier deliver 1-5 tonnes per year for surfactant. In his view, the plantation of oil palms is more productive than other plants and there are no alternatives because of the price.
In his opinion, biotechnology will become more relevant in the production of detergents in the next decades and he doesn’t see a problem with the use of GMOs in this industry (as opposed to the food industry for example). However, it would have to be proven that the synthetic palm kernel oil is more environmental friendly that the natural oil.
Further, he mentioned that environmental protection has a huge value for the Austrian society and many companies are using certificated palm oil right now, although the RSPO (Roundtable on Sustainable Palm Oil) have some niggles. However, better alternatives are currently not available. As a consequence the introduction of stricter inspections in the future will be necessary. Finally, he explained that biotechnology will rather be important in the next decades than in the next years.
Interview with Stefan Thomann (European Candle Association ASBL)
Would you like to introduce your association and yourself?
My name is Stefan Thomann, I am the Managing Director of the of the European Candle Association ASBL, which is the association of the leading candle producers in Europe. Our association interacts quickly and directly with other relevant players, distinguishing us from other associations. We only allow direct membership which helps quick decision making.
Which other associations do exist?
There are a couple of other international associations as well as national associations in some countries. Some of the international associations have national associations as members.
Do your member companies use palm(kernel)oil?
To my knowledge, they do not use palm kernel oil. Some of them use palm oil products however, in various amounts depending on the candle types they produce and on the base material prices. Most candles were made of paraffin wax years ago, but the price has risen significantly and so candle producers had to search for alternatives. Palm can be such alternative for some candle types, but generally, its processing is more demanding. In the meantime, the candle producers know how to process palm products very well however.
Other alternatives are stearin for example or other fats. Most fats have to be hardened first before they can be used in candles. Very often, candle producers do not use only one type of raw material but a mixture.
Which qualities are of interest?
It depends on what kind of candles one would like to produce. Fats typically get rather soft close to the melting point which is the reason why they are mostly used in container candles, e.g. filled glasses or tea lights. If you want to produce free standing candles, you can work with mixtures. But for very small diameters, such as dinner candles for example, you need a lot of stability and have to use raw materials other than palm.
We research on a synthetic alternative for palm kernel oil in E. coli. Would you use in this way produced oil?
It sounds very interesting. The prerequisite for being able to use products from such a new source would be correspondence to certain characteristics that are important for candle production. Penetration is such a characteristic for example. It describes how soft a material is at a certain temperature. Other important characteristics are melting temperature, viscosity, colour, transparency in liquid form, odour, etc.
Which other (native) oils are in use?
Apart from ample supply and an acceptable price, palm oil has the advantage that is does not necessarily have to be chemically hardened, depending on the type of candle of course. It is possible to physically fractionate palm oil into a liquid and solid fraction, and the latter can be used directly in some candle types. But I would say that the largest part that is used is hardened.
Other oils and fats can be used too, at least theoretically. One example is soy which is often used on the US market. Its use is rather low in Europe, mostly because of the considerably higher price compared to other raw materials. Another alternative you can find on the market are candles made of canola, but rarely because of the higher price.
GMOs are a big topic. We work with GMOs, but in the final product wouldn't be any remains left. Would this find usage in the candle industry?
In the end this question can only be answered by each candle manufacturer individually, or, more precisely, by their customers. There are some prejudices against using GMOs. I think one would have to be very transparent and communicate this to customers, both professional ones and the end-consumers, to find out if this is an option.
Do you think the end-consumers would accept it more likely, if we could purify it, that no trace GMOs remains?
I can't answer that for sure, but I know of more than enough examples where this was and is the case. For example, with rennet in cheese production, where it is obviously well accepted. But one should concentrate on the specific case.
How important is environmental protection for the candle industry?
Very important! There are many candle manufacturers of course, and for some it is more important than for others. But generally speaking, the candle industry attaches very high importance to protecting the environment.
Where does the palm oil of your member companies come from?
From what I know, most of them purchase it from suppliers in Europe. Only the bigger producers purchase their material from suppliers outside of Europe. Palm oil can normally not be used for candle production directly. The candle producers can only use certain fractions of it that are obtained after physical and/or chemical processes. This cannot be done by the candle manufacturers themselves, and so they typically purchase the required grades from refineries directly or from distributors. I cannot tell from where those get their supplies.
Do you know RSPO? What is your attitude regarding this issue?
Absolutely!
Sure I know RSPO. As a matter of fact, many of our members are also members of RSPO. Of course the concept of RSPO is not bare of criticism and it is frequently criticised in the media. Their criteria for certification of sustainable palm are rather clear and positive, but what is frequently criticised is their inconsequential punishment of violations. On the other hand, RSPO is the only, or at least the only well-known effort to make palm oil more sustainable. Therefore, many of our members are RSPO members and use certified material. The big problem is that palm cannot be used directly for candle production. You either have to fractionate it or harden it or, in the case of stearin on palm base, split it up. In the worst case, you can only use 10% of the palm for candle production, but if you want that being certified sustainable, you would have to pay the premium for the full volume – which can make the extra costs for certified material for candle use very expensive. Not all customers are willing to pay these considerable extra costs. Nonetheless, some candle manufacturers use certified sustainable palm oil and palm products in their candles. But unless consumers are willing to pay more for sustainable palm in their candles, the breakthrough can only come once imports of RSPO certified to Europe become the rule and not the exception. Once this tipping points is reached, it will be much easier to purchase sustainable palm products on the market. Offering only candles made of sustainable palm at this point of time would be financial suicide for many manufacturers.
How do you think this would influence the evolution of the candle industry?
It will certainly depend on the costs. Additionally, the technical characteristics are very important. There have been many promising approaches to obtain raw materials from alternative resources, e.g. synthetic paraffin wax from waste material. But so far, it has always proofed difficult to replace the existing raw materials with such alternatives. But I certainly hope that it will be different with your project. A short-term objective could be to use it as a blend with other raw materials. If you are able to produce a material with the required characteristics, the chances are good in my opinion. But as I said earlier, the price is an important criterion. But with respective promotion, you could start to establish the products with certain target groups among the customers and end-consumers.
Do you want to know more about our project?
Absolutely, especially if you succeed!
Some last advice on my part: Fats such as palm oil are rather hard to compete with from a financial point of view. Stearin, which is a product of fats obtained by saponification, is more expensive than fats. If you succeed to produce stearin, i.e. fatty acids, rather than fat with your technology, you would be more competitive.
Do you think your member companies would like to know more about us?
As soon as there are promising results and especially some material they can test for suitability in candles, they certainly will. But you should have some samples for them to test first.
Survey
To gain insight in the people’s mind we conducted two surveys among two different target groups: the conscious consumers and passers -by on an action day of our university (TU Graz StreeTech-Day). The process of creating the survey is described under “integrated human practice”.
With the help of CodeCheck, over 1000 people of all ages participated and let us get an overview about their consumption behavior. We found out, that the majority is against the current palm oil situation and hereinafter is trying to avoid it. The main reason for this, with a majority of 89.73% is the environment. But in order their attempt to avoid palm oil containing products (76,38%), ~40% declare to consume them on a regular basis, while only 11,76% claim never to consume palm oil containing products.
Additional findings are that certificates are important to them, only 17,12% never look for palm oil certificates like RSPO or bio-certificates. Also searching for alternatives, the desire for information about biosynthesis, and their disapproval of genetic engineering are very important to them.
For the demographic information, we found out that the majority of conscious consumers consist to 81,74% of women, the biggest age group is between 21 and 30 years old, 83,85% of the participants come from Germany, and more than the half have achieved their A-levels or a higher educational degree.
Even though they disapprove genetic engineering, they have no problem with the usage of microorganism like bacteria or yeast. In fact, if the product would be more environmentally friendly produced, healthier, and has better socioeconomic production conditions people would be more likely to accept and buy products with biosynthetic produced palm(kernel)oil. Some of our survey findings are attached below. To avoid going beyond the scope the demographic data had been excluded.
As comparison, we took out a similar survey among passers-by on one of our University’s action days. The random sample was ways smaller than the CodeCheck sample (51 to 1139) and additionally only 33 sheets could be used for analysis (completion rate was 64,71%) and therefore might be not representative, but there is a similar trend discernible. The rejection of palm oil usage in food, cosmetics and biofuels is very strong in both groups, but the mistrust of genetic engineering is lower among the passers-by.
The majorities of both reference groups are willing to spend more for biosynthetic palm (kernel) oil.
As conclusion, we learned, that the target group of conscious consumers might be a good way starting to reeducate people about genetic engineering and raise awareness, as they are hungry for information and more willing to set environmental benefits above their prejudices about genetic engineering. Further, we once again found out, that the public has a lack of information about genetic engineering, but maybe also about certification processes. For the Codecheck users’ certificates, like bio or RSPO, are very important. It would be important to find out the reasons for this in the future.
