- A new set of guidelines aims to help smallholder oil palm farmers in Indonesia, the world’s top producer of palm oil, ensure their products are deforestation-free.
- This would allow them a foothold in markets that are increasingly demanding, and requiring, sustainably produced goods.
- In particular, the smallholder toolkit aims to address the Indonesian government’s main grievance to a new European Union regulation prohibiting the import of deforestation-linked products, namely that smallholder farmers are least able to comply and will be affected the most.
- The toolkit could also contribute to Indonesia’s climate goals, by incentivizing smallholders to embrace more sustainable farming practices and choosing to conserve forests instead of clearing them.
JAKARTA — NGOs working with Indonesian smallholder farmers have developed a set of guidelines aimed at helping oil palm farmers prove that their products are deforestation-free, allowing them a foothold in markets increasingly demanding sustainably produced goods.
Launched on June 24, the deforestation-free smallholder toolkit, the first of its kind, is a participatory step-by-step guide for smallholder groups to protect their forests and cultivate their lands in a sustainable manner.
To implement the toolkit, smallholders will have to go through six steps, beginning with preparation and information dissemination, in which community members will receive explanations about the toolkit and how it benefits smallholder groups and villages.
After that, the communities will map all the forests and land cover on their village lands. They’ll then identify which forest areas have high carbon stock (HCS) and high conservation value (HCV), such as ancestral lands and those rich in biodiversity. This step is crucial to distinguish forest areas that should be protected, from degraded areas that can be developed.
At the end of the process, the communities will come up with integrated conservation and land-use plans, or ICLUP. These plans include details on how village and community lands will be used and managed. For instance, a village might decide that all HCS and HCV areas should be protected, while prescribing punishments for anyone who violates customary forest practices. It might also decide to practice ecological farming and agroforestry to sustain local livelihoods while protecting HCS and HCV forests at the same time.
At each step, the smallholders will have to give their free, prior and informed consent (FPIC). This is to ensure the toolkit truly benefits the communities and to prevent any disputes further down the line.
Overall, the toolkit is meant to help smallholders practice farming without deforestation and give them opportunities to decide for themselves what’s best for their lives and their lands.
This makes the toolkit the only one of its kind in the world to target deforestation by smallholders, according to Grant Rosoman, a forest senior adviser for Greenpeace International and member of the High Carbon Stock Approach (HCSA), a widely supported mechanism that’s also used in the toolkit.
While mechanisms like HCSA have long existed to help large companies tackle deforestation and protect forests in their concessions, there was no such toolkit specifically tailored to smallholders, he said.
That therefore left smallholders to their own devices, Rosoman said.
“It enables situation where the smallholders were left behind as well by not having a methodology that they can use,” he said at the launch of the toolkit in Jakarta. “Now we have fixed that by having this methodology developed in the last six to seven years.”
The toolkit was developed through collaboration between the HCSA, the Indonesian union of oil palm smallholders, or SPKS, the Farmers for Forest Protection Foundation (4F), Greenpeace, and the High Conservation Value Network (HCVN).
The development process included piloting the toolkit with smallholders in West Kalimantan province, in Indonesian Borneo, over four years to ensure the methodology is simple to apply and well adapted to local community conditions.
The participating smallholders in that trial, including members of the Indigenous Dayak Hibun community, were also heavily involved in the development process.
“I saw for myself that this toolkit was really developed based on input from smallholders, Indigenous peoples and local communities, when the toolkit was piloted in West Kalimantan,” said Valens Andi, a smallholder farmer from Sanggau district in West Kalimantan. “I have seen the positive impact myself.”
During the pilot, the smallholders were able to identify 2,727 hectares (6,739 acres) of ancestral forests that should be protected. The communities went on to map 364 hectares (900 acres) and came up with plans to manage and protect these areas, said Tirza Pandelaki, executive director of 4F.
“We know that deforestation-free for smallholders is feasible and achievable,” she said. “The proof is that many of our farmers are capable of protecting their forests [during the trial in West Kalimantan].”
This dispels the notion that smallholders aren’t capable of cultivating their lands sustainably. They’re often blamed for deforestation in Indonesia, and thus are excluded from markets, said SPKS chair Sabarudin.
Now that smallholders can use the toolkit, they can prove to the market that their products are deforestation-free, and thus enjoy fairer market access and price for their products, he added. This is especially important as there’s a growing global market requirement for products to be deforestation-free, such as in the European Union, one of the biggest importers of palm oil from Indonesia, itself the world’s largest producer of the commodity.
EUDR
In 2023, the bloc adopted the EU Deforestation Regulation (EUDR), prohibiting the import of commodities like palm oil that were produced illegally, on land deforested after Dec. 31, 2020, or whose provenance can’t be traced.
The Indonesian government has protested the new regulation, saying it will disproportionately hurt smallholder farmers, who manage a combined 6.72 million hectares (16.6 million acres) of oil palm plantations across the country.
A 2022 survey of independent smallholders by Indonesian environmental NGO Madani in four palm oil-producing districts found most faced difficulties ensuring traceability, due to a lack of documentation of transactions. Many also lacked clear title to their land, making it difficult for them to comply with the legality element of the EUDR.
This is why there needs to be greater support to help these farmers join the deforestation-free supply chain and avoid a vicious cycle of unsustainable production, smallholder advocates say.
And this is where the new deforestation-free toolkit could come into play, its developers say.
“The HCSA smallholder toolkit enables small-scale farmers to prove they can produce commodities and conserve the forest and biodiversity while respecting the rights of Indigenous peoples and local communities, therefore becoming a key link of sustainable supply chains and markets when partnering with large producers and buyers and as part of sustainable productive landscapes,” said HCSA executive director Jesús Cordero.
The EU itself doesn’t recognize any third-party certification as means of compliance, and thus a toolkit like this wouldn’t replace the need for buyers importing the target products into the EU to carry out their due diligence. However, these importers can use the data provided by certification schemes or other third-party verification systems to fill out their due diligence statements, which should facilitate full market access into the EU.
And these schemes could include the new toolkit, according to Eloïse O’Carroll, the program manager for forestry, natural resources and energy at the EU Delegation to Indonesia. Having the toolkit, she said, points smallholders “in the direction of EUDR readiness.”
Rosoman of Greenpeace said their lawyers in Europe were confident the new toolkit provides sufficient evidence to demonstrate no deforestation and therefore compliance with the EUDR.
Leaving oil palm smallholders out of the EU supply chain means the market will miss out on their potential contribution. While Indonesia’s oil palm smallholders often manage just a couple of hectares each, their collective impact is substantial, accounting for approximately 40% of Indonesia’s total palm oil production.
“The EUDR and other international regulations simply cannot afford to disregard the vast potential for the contribution of smallholders to deforestation-free supply chains,” Cordero said.
To ensure that smallholders aren’t left behind, the EU has a number of initiatives to support them, O’Carroll said. Among these is the global Team Europe Initiative (TEI) on Deforestation-free Value Chains. Under this initiative, the EU and member states provide 70 million euros ($76 million) to support partner countries in transitioning to deforestation-free and legal supply chains.
The support includes technical assistance and capacity building for partner governments as well as producers on key issues such as traceability, geolocalization and land-use mapping.
“Often we hear that Indonesia is not ready and smallholders will be left out of the supply chain, but the reality is they’re already left out of the rest of the supply chain so we want to do our best to ensure they’re actually implementing practices that can get them to export to the EU market,” O’Carroll said.
Government role
Even without the demand from the global market for deforestation-free products, empowering smallholders to protect their forests and produce sustainably would still be beneficial to the farmers and help the Indonesian government meet its climate and forest conservation targets, said Kiki Taufik, global project leader for the Indonesian forest campaign at Greenpeace.
Forestry and other land uses, or FOLU, which includes clearing of forests for oil palm plantations, account for the largest share of Indonesia’s greenhouse gas emissions. The government has set a goal of getting this sector to absorb more carbon than it releases, a target known as FOLU net sink 2030.
Better forest management practices by smallholders would help in this regard, so the government should support small farmers by providing a legal umbrella to those who want to conserve their forests rather than clear them, said SPKS advisory board member Mansuetus Darto.
“Legally speaking, these farmers could just clear their forests to make way for oil palm plantations, but they choose to protect their forests,” he said.
The government should thus issue a regulation, similar to a moratorium on clearing primary forests for oil palm plantations, to give legal protection to smallholders who choose to protect their forests, Mansuetus said. That earlier moratorium ran from 2018-2021.
Markets that demand deforestation-free products, like the EU, should also provide incentives for smallholders, such as a price premium, to incentivize them to produce sustainable commodities, Mansuetus added.
“We need help from all parties so that smallholders can implement best practices and continue to conserve forests without being forced to leave our local wisdom and culture behind,” said Valens, the smallholder farmer from West Kalimantan.
Banner image: Soil fertilization process in an oil palm plantation. Image by Cooke Vieira/CIFOR via Flickr (CC BY-NC-ND 2.0).
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