Oleochem Analytics – Indonesia, the world’s largest palm oil producer, introduced a three-year freeze on plantation permits that expires in September 2021.
The moratorium, the Presidential Instruction No 8/2018 on the Delay and Evaluation of Permits and Elevated Productivity of Oil Palm Plantations, was finally approved by Indonesian President Joko Widodo in September 2018 after several years of preparation, to tackle deforestation caused by new plantations.
The moratorium was announced by the president for the first time in early 2016 as a response to the catastrophic forest fires that occurred in Indonesia’s forests and peatlands in 2015.
The 2015 blazes were especially serious, worsened by dry weather caused by an El Niño phenomenon, and cloaked large stretches of South-East Asia in toxic smog for weeks.
From 2001 to 2020, Indonesia lost 27.7 million hectares (Ha) of tree cover, equivalent to a 17% decrease in tree cover since 2000, according to the Global Forest Watch, an environmental non-profit based in Washington D.C. The tree cover loss has been in constant decrease since 2016, when the loss reached its peak at 2.42 million Ha.
According to the Presidential Instruction, the freeze was originally meant to be applied not just to new requests for licenses but also to projects that have obtained some, but not all, of the permits needed to begin operating.
Widodo said in a statement published by the government in March 2016 that “palm oil concessions available at the moment are already adequate” and urged producers to concentrate on using better seeds to increase their yields.
According to data from GAPKI, the Indonesian Palm Oil Association, the total size of Indonesia’s oil palm plantations in 2016 reached 14.03 million Ha. Most – nearly 60% – was controlled by private companies, while around 40% was controlled by smallholder farmers. State-owned oil palm plantations only accounted for about 1% of the total.
Although Widodo decided for a three-year stop on the issuance of new permits for palm oil plantations, environmentalists say that Indonesia should make permanent its temporary ban in order to achieve its goals.
Indonesian government has not state anything on the matter yet.