SOWMYA REDDY

121901075

INTERNATIONAL BUSINESS MANAGEMENT

ENVIRONMENTAL DISASTER DUE TO PALM OIL INDUSTRY

Today, you have most likely used several products containing palm oil. It is a growing
issue in debates surrounding food sustainability and climate change and one that needs to be
addressed. In a report published by the Guardian earlier this year, it was stated that every person
around the world consumes an average of 8 kg of palm oil a year, most of it through the food we
eat. However, palm oil is also a common ingredient in other products, such as cleaning products
and personal care items, e.g. shampoo, lotion and make up. According to WWF, almost 50% of
the packaged products in supermarkets contain palm oil. Before discussing the environmental

concerns of palm oil, let’s just quickly clarify what palm oil is. In the picture above, you can see
the fruits that contain the oil we call palm oil. Palm oil is a vegetable oil that is derived from oil
palm trees, mostly grown near the equator. The oil itself is found in the thousands of small fruits
that are growing in large bunches on the trees. Indonesia and Malaysia accounts for 86% of the
global production, and more than half of the global demand comes from Asia. The worldwide
production of palm oil has been increasing for several decades, and experts believe that this will
continue. By 2050, the demand for palm oil is expected to quadruple.
 Palm oil has been criticized by many, including scientists, activists and organizations
such as Greenpeace and the Palm Oil Investigations. In a report published by the BBC,
environmentalists argue that the farming of oil palm trees is having damaging effects on the
environment. Deforestation – cutting or burning down forests and trees to clear land to use it for
something else – is frequently practiced to plant oil palm trees. Burning down forests lead to a
loss of biodiversity, air pollution and climate change. Since oil palm trees grow in tropical
climates near the equator, palm oil has been and continues to be a major driver of deforestation
of some of the world’s most biodiverse forests. The plantations of oil palm trees are threatening
already endangered species, such as the Orangutan and the Sumatran rhino.

DEFORESTATION:

Palm oil has been linked with the destruction of the world's
precious rainforests. Development of new oil palm plantations,
coupled with smallholders expanding their farms to meet the
rising demand for palm oil, has resulted in significant
deforestation.

THREAT TO SPECIES SURVIVAL:

The removal of acres of rainforest threatens the rich

biodiversity in these finely balanced ecosystems, along with the
habitat of species such as the orangutan. In 1990 there were
around 315,000 orangutans. Today it's estimated that fewer than
50,000 exist in the wild, split into small groups with little chance
of long-term survival. The orangutan is only one of a number of
species facing extinction as a result of deforestation. While palm
oil is not the only cause of deforestation, it does play its part.

ENVIRONMENTAL DAMAGE:

The removal of forest releases carbon into the atmosphere,

speeding up global warming. In the tropics, tree roots anchor the
soil. Deforestation removes this important structure, allowing
heavy rains to wash away nutrient-rich soil. Crop yields begin to decline and farmers then have
to use expensive fertilizers, which eat into their profits and further damage the environment

SOCIAL CONSEQUENCES:

While the global palm oil market creates an opportunity to bring many communities out
of poverty, the race for land rights has left many locals on the losing team. Reports of displaced
communities and illegal land grabs are not uncommon. The resulting conflicts, loss of income
and dependence on large plantations have had a significant impact of the social welfare of many.

HOW DOES IT HARM:

Oil palms grow well in low-lying, tropical regions, which tend to house rainforests and
peatlands. They home to an array of endangered species including orangutans, rhinos and
tigers.The creation of massive plantations has meant these rich ecosystems have been replaced
with monocultures – “green deserts” in which native animals and plants cannot thrive. Burning
of forests to make way for palm pollutes the environment, and deforestation is a major
contributor to greenhouse gas emissions. In total, palm oil plantations are now thought to cover
more than 27 million hectares. While palm oil development has brought great economic
opportunities to some local people, it has also been linked with the persecution of indigenous
groups as developers move in and seize land.

WHAT CAN PEOPLE DO TO HELP?

Because palm oil is so pervasive, it can be difficult to avoid. Brands understand that
people might be trying to avoid palm oil and often give it different names in their ingredient lists
such as “vegetable oil” or “vegetable fat”. However, it is possible to purchase products made
with palm oil deemed sustainable. The Roundtable on Sustainable Palm Oil certifies some palm
oil as sustainable if its production has been deemed socially and environmentally responsible,
and consumers can look out for its label on products. On-government organizations have
persuaded many of the biggest companies to sign global commitments to drop “dirty” palm oil,
but there is a lot of skepticism about now effective these measures have been. Firms have been
accused of only sticking to the most basic requirements for sustainability, meaning forests are
still at risk. So consumers can police their own purchases, but they can also help by petitioning
companies and piling on the pressure to switch over to palm oil production that does not
compromise some of the most previous ecosystems on Earth.