Three giant palm oil corporations — Asian Agri, Apical Group and Kao Corporation — on Wednesday (28/10) jointly launched a new initiative to assist independent oil palm smallholders in obtaining sustainability certification, increasing their productivity and improving their welfare.
SMILE or Smallholder Inclusion for Better Livelihood & Empowerment is a collaborative program involving the three companies for a planned duration of 11 years with the aim of building a sustainable palm oil value chain that includes independent smallholders.
“This program is the result of our cooperation, including with independent smallholders, especially in the palm oil industry where 40 percent of palm oil production comes from independent smallholders. But to be able to do this, of course there has to be someone who is prepared to bridge all related parties,” Yeo How, President of Apical Group Ltd said during an online discussion organized by CNN Indonesia.
“We need people on the ground and at the same time also need support from companies and the market,” he added.
Masakazu Negoro, Managing Executive Office of Kao Corporation added that this program must be carefully prepared, starting from its economic side, the necessary scientific support and any other assistance that would be needed. He also said that, apart from helping independent farmers, this program would also help protect the environment.
“So, we have to prepare the support for them while also protect the environment, we also focus on our products and we have products made from chemicals, and therefore, in this project, we will provide all supports for smallholders, their economy, provide knowledge and also other forms of assistance,” said Masakazu.
Kelvin Tio, Asian Agri Managing Director, meanwhile said Indonesian consumers currently preferred sustainable palm oil and therefore he would try to help independent smallholders obtain certification by providing knowledge on how to select and provide good seedlings, and assistance in infrastructure and planting finance.
“We see how important the role of smallholders in Indonesia is, and Indonesia’s commitment to the sustainability of palm oil. Because I feel that Indonesian consumers are now starting to move towards sustainability and we have engaged in cooperation with independent smallholder groups, we are giving them knowledge on how to select good seedlings, providing assistance in financing infrastructure and planting. We do this so that they can easily obtain certification,” said Kelvin.
He added that this program sought to bridge independent smallholders in gaining knowledge and in building partnerships with concerned companies. He also said that there were obviously challenges that would have to be faced by companies involved and as well as by those independent smallholders taking part in the program.
“SMILE seeks to bridge the knowledge gap of independent smallholders through partnerships and broaden the scope of success of Asian Agri, which has built long-term partnerships with farmers,” said Kelvin, adding that SMILE realized the challenges faced by independent smallholders as business actors in increasing the productivity of their gardens due to their limited knowledge and technical capabilities.
Palm oil is the most widely used vegetable oil in the world and has various types of uses, such as for processed food ingredients, cooking oil, biodiesel raw materials, and raw materials for making detergents and cosmetics. This diversity of functions allows global palm oil production to reach 75 million tons per year and according to data from BPS (Central Statistics Agency) it is predicted that it will reach 111.3 million tons in 2025.
Sutoyo, Chairman of the Anugrah Association, said that there were still many independent farmers who thought that having a certification was not important and thus they continued to cultivate crops carelessly. He hoped this program could help eliminate this paradigm.
“The challenge I face is changing the paradigm of individual farmers, a paradigm where we could not always move individually, as it would be difficult to get maximum results. The presence of several stakeholders can certainly, with good guidance, help change our paradigm, which was previously unplanned,” said Sutoyo.
Nurbaya Zulhakim, Director of the Setara Jambi Foundation, agreed, saying that there were indeed many farmers who did not really understand the purpose of certification, and therefore he was trying to provide knowledge about this to independent smallholders so that certification would not only be seen as a mere document but as something that could have a positive impact.
“There are many challenges, for example there are still many farmers who do not really understand what is the use of certification. We have been trying to teach them that certification would give them a positive impact. That certification was not only a sheet of document but could have a positive impact,” added Nurbaya.
RSPO Chief Operating Officer, Bakhtiar Talhah expressed his appreciation for the assistance provided by members and implementing partners such as Kao, Apical and Asian Agri so that farmers can gain access to RSPO certification.
“Through shared passion and responsibility, we invite more companies to support the new RSPO independent smallholder standards to increase farmer involvement in the sustainability agenda of improving their livelihoods and providing them a wider access to international markets,” said Talhah.