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Sustainable Palm Oil Initiative: Transforming Markets for a Greener Future

Explore the world of sustainable palm oil production with a focus on social and environmental benefits. Learn about the Roundtable on Sustainable Palm Oil (RSPO) and its mission to make sustainable practices the norm in the industry.

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Sustainable Palm Oil Initiative: Transforming Markets for a Greener Future

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  1. AN INTERNATIONAL MULTI STAKEHOLDER INITIATIVE TRANSFORMING MARKETS TO MAKE SUSTAINABLE PALM OIL THE NORM

  2. OUTLINE • What is Palm Oil? • The need for certified sustainable Palm Oil • The Roundtable on Sustainable Palm Oil (RSPO) • Where we are today? • Where do we go from here?

  3. WHAT IS PALM OIL? - Ca’daMosto, 15th century explorer on discovering palm oil “It has the scent of violets, the taste of olive oil and a colour which tinges food like saffron, but is more attractive!”

  4. WHY PALM OIL?

  5. PALM OIL IS… • …a highly versatile vegetable oil • …used in many food and non-food products • …produced in tropical countries • …rapidly growing in market share • …the world’s top selling vegetable oil • …highly versatile, being used in more than half of packaged supermarket products today

  6. THE TOP PALM OILPRODUCING COUNTRIES

  7. MAJOR IMPORTERS OF PALM OIL (2012/13 July)

  8. THE ADVANTAGES OF PALM OIL • Highly efficient producers of oil • Requires less land than other oil crops (Images courtesy www.mongabay.com)

  9. AVERAGE YIELD PER YEAR(tonnes of oil per hectare)

  10. WHY SUSTAINABLE PALM OIL?

  11. SOCIAL ISSUES INOIL PALM CULTIVATION Treatment of smallholders Land ownership conflicts Workers rights and conditions

  12. ENVIRONMENTAL ISSUESIN OIL PALM CULTIVATION Biodiversity loss Forest, peat land conversion Climate change

  13. WHAT IS THE

  14. The RSPO was formed in 2004 with the objective of promoting the growth and use of sustainable oil palm products through credible global standards and engagement of stakeholders. • The seat of the association is in Zurich, Switzerland, while the secretariat is currently based in Kuala Lumpur, with a satellite office in Jakarta. • RSPO is a not-for-profit association that unites stakeholders from seven sectors of the palm oil industry - oil palm producers, palm oil processors or traders, consumer goods manufacturers, retailers, banks and investors, environmental or nature conservation NGOs and social or developmental NGOs - to develop and implement global standards for sustainable palm oil.

  15. VISION To transform markets to make sustainable Palm Oil the norm.

  16. MISSION To advance the production, procurement, finance and use of sustainable palm oil products. To develop, implement, verify, assure and periodically review credible global standards for the entire supply chain of sustainable palm oil. To engage and commit all stakeholders throughout the supply chain, including governments and consumers. To monitor and evaluate the economic, environmental and social impacts of the uptake of sustainable palm oil in the market”

  17. HIGHLIGHTS • Commenced in 2003 with 7 members • Formally established in April 2004 • Multi-stakeholder association • International non-for-profit association • Palm oil supply chain • Promotes growth & use of sustainable Oil Palm products through global standards • RSPO Principles and Criteria (P&C)

  18. ORGANIZATION STRUCTURE Ordinary Members Affiliate Members Supply Chain Associates General Assembly Executive Board Secretary General Standing Committee Standing Committee Standing Committee Standing Committee Trade & Traceability Communications & Claims Standards & Certifications Finance Working Groups Working Groups Working Groups Working Groups

  19. 8 PRINCIPLES Commitment to transparency Compliance with applicable laws and regulations Commitment to long-term economic and financial viability Use of appropriate best practices by growers and millers Environmental responsibility and conservation of natural resources and biodiversity Responsible consideration of employees and of individuals and communities affected by growers and mills. Responsible development of new plantings Commitment to continuous improvement in key areas of activity

  20. MEMBERSHIP • As the RSPO gains recognition and momentum, membership of the Roundtable is growing, and the volume of sustainably produced palm oil on world markets is expected to grow exponentially. • RSPO has three categories of membership: • Ordinary Membership (OM) consists of the main players in the palm oil supply chain - oil palm growers, processors & traders, manufacturers of consumer goods, retailers, banks & investors, environmental NGOs and social /developmental NGOs. • Affiliate Membership is open to any individual or organizations that are not included in the 7 Ordinary Membership sectors and are interested in supporting the objectives and activities of RSPO. • The third category which was introduced more recently enables the organizations that are active in the supply chain for certified sustainable palm oil, but do not purchase more than 500 MT palm oil products per year to be Supply Chain Associates. (Latest statistics on membership can be accessed at http://www.rspo.org/en/membership_key_statistics)

  21. 964 MEMBERSFROM OVER 50 COUNTRIES Latest data at http://www.rspo.org/en/membership_key_statistics

  22. MULTISTAKEHOLDER MEMBERSHIP Data as of May 2012. Latest data at http://www.rspo.org/en/membership_key_statistics

  23. MEMBERSHIP BY COUNTRY Data as of May 2012. Latest data at http://www.rspo.org/en/membership_key_statistics

  24. WHERE IS THE TODAY?

  25. Code of Conductfor members • Independent certification bodies • Principles, specific criteria and indicators for sustainable Palm Oil production • Supply chain certification systems • Guidelines on communication and claims

  26. CODE OF CONDUCT - Annual Communications of Progress “All members will publicly commit to production, procurement and use of sustainable palm oil.” (Grievance panel supervises compliance)

  27. SUSTAINABILITYPRINCIPLES Transparency Use best practices Care for environment,natural resources,and biodiversity Consider rights ofworkers, smallholders Develop new plantings responsibly

  28. SPECIFIC SOCIAL CRITERIA AND INDICATORS Rights to the land are not legitimately contested Workers’ are paid reasonably and living conditions are decent The right to form trade unions is respected Health and safety plans are implemented Smallholdersare treatedfairlybymills (Image courtesy www.mongabay.com)

  29. SPECIFIC ENVIRONMENTAL CRITERIA AND INDICATORS Since November 2005, new plantings did not replace primary forests or high conservation value areas Erosion and degradation of soils are minimized Pollution and waste is reduced Use of fires is avoided

  30. RESPECTING DIVERSITY: NATIONAL INTERPRETATIONS OF GUIDELINES • Papua New Guinea (2008) • Malaysia (2008) • Indonesia (2008) • Colombia / L. America (2010) • Ghana (2011) • Thailand (2012)

  31. PLANT / MILLCERTIFICATION PROCEDURE • Approved certification bodies listedon RSPO website • Audit by certification body (1 month notice) • Unit of certification: oil mill and suppliers • Compliance with Principles, Criteria and Indicators • Phase I: Document review • Phase II: Field checks, stakeholder interviews • Audit Report, summarypublished online

  32. SUPPLY CHAIN MODELS

  33. THE PALM OIL SUPPLY CHAIN PLANTATIONS MILL SMALLHOLDERS • Many links • Potential for mixing STORAGE, TRANSPORT & SHIPPING PRODUCT MANUFACTURERS REFINERS & BLENDERS INGREDIENT MANUFACTURERS RETAILERS

  34. SUPPLY CHAIN MODELS • ‘Identity preserved’:Sustainable oil kept apart, traceable to plantation • ‘Segregated’:Mixing of sustainable palm oil batches is allowed • ‘Mass Balance’: Mixing of sustainable and conventional oil allowed if monitored administratively Monitored through RSPO eTrace (www.eTrace.rspo.org) • ‘Book & Claim’:Monitored by GreenPalm (www.greenpalm.org)

  35. SUPPLY CHAIN MODEL‘Identity Preserved’ RPSO eTrace 100 ton 100 ton 100 ton 100 ton MILL END USER TRANSPORTER REFINER certified MILL END USER TRANSPORTER REFINER

  36. SUPPLY CHAIN MODEL‘Segregated’ 100 ton RPSO e-TRACE 100 ton MILL END USER certified 200 ton 200 ton TRANSPORTER REFINER 100 ton 100 ton END USER MILL MILL END USER TRANSPORTER REFINER

  37. SUPPLY CHAIN MODEL‘Mass Balance’ 100 ton MILL RPSO e-TRACE 100 ton certified END USER MILL END USER TRANSPORTER REFINER

  38. SUPPLY CHAIN MODEL‘Book & Claim’ • ‘Book and Claim’ by GreenPalm- GreenPalm certificates allow end users to support RSPO certified growers via online trading • Certificates trading have a significant role to play, particularly in these areas: • Easily accessible to all users of palm and palm kernel oil products, allowing buyers to make strong market claims • Particularly important option in the complex derivatives and emerging markets • The option provides a direct support link to groups of smallholders • www.greenpalm.org

  39. SUPPLY CHAIN MODEL‘Book & Claim’ 100 Certificates 100 ton 100 ton MILL certified MILL END USER TRANSPORTER REFINER

  40. SUPPLY CHAINCERTIFICATION PROCEDURE • Verifies movement of oil through the supply chain • Step-by-step documentation • Performed by 3rd-party certification bodies • More info: www.rspo.org

  41. MILESTONES

  42. CONSUMER COMMUNICATIONS • RSPO trademark developedfor/on/about – productcommunication • Rules for use, communication and licensing under development • Trademark registration procedures begun in more than 60 countries • Launched: June 2011

  43. HIGHLIGHTS • 8 April 2004: RSPO formerly established under Article 60 of the Swiss Civil Code • 2008:National Interpretations (NIs) of the generic Principles & Criteria for Indonesia, Malaysia and PNG approved • 21 August 2008: 1st P&C certification for United Plantations. • 27 November 2008: Inaugural shipment of CSPO arrived in Rotterdam in November • November 2009: Adoption of the RSPO Supply Chain Certification Systems • October 2010: RSPO global membership reached 500 Ordinary Members • 2010: First RSPO certificate to Latin America, Daabon Group, Colombia • June 2011: Launch of the RSPO Trademark • August 2011: First I million hectares of certified production area around the world • August 2011: First RSPO certificate to Brazil, Latin America by Agropalma • August 2011: Global production of CSPO reaches 5 million tonnes, 10% of global palm oil production • April 2012: Achievement of 6 million metric tonnes of CSPO in annual production capacity (marked by public listed New Britain Palm Oil Limited’s latest mill in Papua New Guinea)

  44. TABLE 1: Key Statistics for Certification Summary as of 29th February 2012 Feb 2012 Total 2011 01-02/2012 Data as of May 2012. Latest data at http://www.rspo.org/en/key_statistics

  45. CSPO & CSPK Annual Production Capacity (mt) by Year Data as of May 2012. Latest data at http://www.rspo.org/en/key_statistics

  46. TM LICENSES ISSUEDBY COUNTRY Data as of May 2012. Latest data at http://www.rspo.org/en/membership_key_statistics

  47. TM LICENSES ISSUED BYSTAKEHOLDER CATEGORY Data as of May 2012. Latest data at http://www.rspo.org/en/membership_key_statistics

  48. RSPO’s ASPIRATIONS • Grow supply of certified palm oil • Grow demand for certified palm oil including in India& China • Grow RSPO membership • Engage governments • Engage and educate smallholders

  49. ENGAGING MORE THAN3 MILLION SMALLHOLDERS • They maintain 20% of acreage • RSPO Task Force on smallholders • Promote smallholder interests within RSPO • Raise awareness among smallholders • Adapt RSPO standards and procedures • Develop group certification protocol

  50. IN CONCLUSION

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