Palm Oil Fuelling Scramble for Land in Africa

Credit: Jeff Hickmott - Photo: 2011

Palm Oil Fuelling Scramble for Land in Africa

By Joan Baxter*
IDN-InDepth NewsReport

Palm oil is expected to be the world’s most produced and internationally traded edible oil by 2012. At what price? As foreign investors descend on Africa to develop large-scale palm oil plantations, the survival of local people is being threatened. They are losing control of the land and water on which they depend for their food production and livelihoods.

OAKLAND (IDN) – The oil palm nursery occupies several hectares of newly cleared forest and fallow land in Sierra Leone. The nursery manager says that by 2012 he will have 540,000 oil palm seedlings, enough to plant over 3,000 hectares. By 2017, the plan is to establish oil palm over 40,000 hectares that have been leased by a foreign investor for 45 years, with a possible extension of 21 more.

But for him, this is a “small” plantation. He is managed far larger ones in his native Malaysia. He says Sierra Leone has to start now to establish oil palm plantations because there is no more land in Malaysia and Indonesia.

By next year palm oil is forecast to be the world’s most produced and internationally traded edible oil. Apart from its use as a cooking oil, it is also found in an astonishing range of processed foods and cosmetics. One in ten supermarket products contains palm oil. Government targets for the use of agrofuels in Europe, China and North America are making palm oil, which can be used to produce biodiesel, an even hotter commodity. The burgeoning demand for palm oil is fuelling a war of words over its pros and cons, and fuelling a new scramble for land in Africa.

Malaysia and Indonesia currently account for about 83 per cent of production and 89 per cent of global exports of palm oil. But environmental and civil society groups have drawn world attention to the way that rainforests and peat-lands have been cleared in Southeast Asia for industrial-scale oil palm plantations, some intended to produce agrofuels purportedly intended to mitigate climate change even as they aggravate it.

Malaysia’s Palm Oil Council has been defending the industry, establishing The Oil Palm website to ‘educate others’ on the benefits of palm oil. There is even a Oil Truth Foundation website, filled with vitriolic attacks on organisations such as Greenpeace and Friends of the Earth, which have been critical of industrial palm oil producers. An email enquiry to the website received no response.

To try to counter the criticism, in 2004, palm growers, oil processors, traders, consumer goods manufacturers, retailers, investors and NGOs formed the Roundtable on Sustainable Palm Oil, ‘dedicated to promoting sustainable production of palm oil worldwide’. But Friends of the Earth maintains that this ‘demand for ‘sustainable’ palm oil is simply leading to the expansion of other palm oil plantations onto forested land’ and causing more deforestation.

A recent moratorium in Indonesia on new concessions for land in forest areas and peat-lands, as full of loopholes as it may be, is driving industrial giants such as Sime Darby, Olam International and Wilmar International and a host of European, American and Asian investors and speculators seeking to get in on the palm oil boom to search for new lands. Their target is the ‘final investment frontier’, the much-abused continent of Africa.

The ‘Final Investment Frontier’

There are no detailed studies showing the full extent of foreign investment in land for oil palm in West and Central, so information about land deals, many lacking any transparency, is piecemeal at best.

In Liberia, a country that was ravaged for years by war, an estimated 5.6 per cent of the total land mass has been leased out to foreign investors for palm oil production. Sime Darby has a 63-year lease for 220,000 hectares of land for oil palm plantations in the country. Singapore-listed Golden Agri Resources has another 220,000 hectares for palm oil estates, and Equatorial Palm Oil, a UK-listed palm oil developer has another 170,000 hectares. This, in a country that still has to import 60 percent of its staple rice needs.

In neighbouring Sierra Leone, another nation trying to regain its own food security and heal itself after a long civil war, European and Asian firms are securing long-term (50 year) leases on at least half a million hectares of farmland, almost 10 per cent of the country’s arable land. Of that amount, close to 300,000 hectares have been acquired for oil palm plantations by corporate investors from Europe and Southeast Asia.

In Cameroon, foreign investors from Asia, the U.S. and Europe are rapidly securing enormous land banks, often in fragile forested areas, for palm oil estates. The same is true in Benin, Nigeria, Gabon, the Republic of Congo and the Democratic Republic of Congo, where a Chinese company is reportedly working to secure 2.8 million hectares for oil palm for biodiesel production.

African governments that are endorsing and enabling this wave of large land acquisitions seem to have forgotten their countries’ long and painful struggles for independence. They are not just allowing but actively encouraging the foreign industrialists and speculators to repeat the same grave injuries committed by colonists and industrialists of yesteryear.

Taking Possession of the Tree, Then the Land to Grow It

Apart from some large plantations established during colonial times or as state-owned enterprises by newly independent governments in the region, in West and Central Africa oil palm is still largely growing almost wild or being cultivated in an environmentally sustainable way by smallholder farmers.

Just for the record, the oil palm on which the industry has grown so wealthy – Eleais guineesis – is native to and really belongs to the people of West and Central Africa. Or rather, it would do, were African farmers in the business of taking out patents on genetic material. It formed part of the food supply of indigenous populations long before recorded history and was widely traded as well. It has been found in Egyptian tombs dating back to 3,000 BC.

But once Europeans ‘discovered’ this African treasure, the takeover began. During the Atlantic slave trade, red palm oil was used to provision slave ships. Later, the British Industrial Revolution used the oil to lubricate machines and in candle making. By the 20th century, Europeans were running plantations of the tree in Central Africa and Southeast Asia.

By 1960, Malaysia had become the world’s largest producer of palm oil, giant monoculture plantations had become the norm, and the oil they were producing was highly refined and exported worldwide. During the recent boom driven by the demand for agrofuels, in 2007 Indonesia overtook Malaysia as the largest global producer of the oil. The whole lucrative plantation industry in Asia was based on oil palm planting material that originated from four specimens of the African tree that were taken to the Bogor Botanic Gardens in Indonesia in 1848.

Local growers and consumers in Africa do not refine, bleach and deodorise the oil into the commodity that industry produces for the world market. Increasingly, science recognises what local people in Africa have always known, that locally grown and locally processed red palm oil is nutritious. It is an excellent source of Vitamins E and K and full of carotenes, which can be converted in the body to Vitamin A. It is also medicinal.

In West and Central Africa, oil palm is often grown by rural people in ‘tree-crop plantations’ just one or two hectares in area, in diverse stands of other important trees in and around their farmland and at forest edges. It grows well in forest fallows and in agroforestry stands that include kolanut, citrus, indigenous fruit and timber trees, banana and plantains, and cocoa and coffee.

The indigenous oil palm is invaluable in the region. The rich red oil that is extracted manually from the palm fruit is a staple in diets, second in importance only to rice or other staple grains or cereals. It is used in soups and sauces, for frying, and in dough made from customary foods such as cassava, rice, plantains, yams and beans. The fruit can even be boiled and roasted with a bit of sugar, tasting very much like a delicious date. The clear oil that is extracted, mostly manually, from the palm kernel is used to make soap. The tree flourishes in natural association with other key food crops such as cassava and yam. The pressed cake left after extraction can be used for fodder. Palm fronds are used for thatch.

Wild and cultivated stands of oil palm in West and Central Africa are also the source of one of the region’s great delicacies – palm wine, which is collected directly from the tree and an important source of income for the tappers. Grown and used the way it traditionally has been in Africa, the oil palm also performs environmental services. It can help reclaim degraded lands, as a valuable shade tree in biodiverse cocoa and coffee tree-crop plots, and the residue left in boilers after oil extraction can be used to fertilise soils.

But all of this relates to oil palm only as smallholders grow and use it. Like so many African treasures, once the foreign industrialists got their hands on it and took it away, the oil palm became something very different. In the hands of corporations, palm oil was transformed into a highly profitable commodity for the world market and its industrial production has caused immeasurable environmental damage in Southeast Asia. It appears poised to do the same in Africa.

Prevailing economic dogma emphasises economies of scale and increased profitability through sheer size of oil palm estates. It does not take into consideration what is lost from the land when it is transformed into endless rows of oil palm clones, or the environmental damage caused by heavy pesticide and fertiliser use required in monoculture plantations.

Local people are told that this kind of foreign direct investment in their farmland will bring development, jobs and modernise agriculture. They tend not to be informed about what is at stake – their farmland, water resources, environment, biodiversity, food security and sovereignty.

Governments and traditional rulers seem indoctrinated by the myth that allocating large tracts of land to foreign investors will lead to ‘modernised’ agriculture. They and others promoting the land deals as a form of agricultural investment would have us believe that anyone who defends smallholder production is succumbing to ‘romanticism’. They appear equally oblivious, wilfully so, to the enormous risks these land deals incurs for their people and their nations.

Smallholder farms are massive employers, critically important for poverty reduction. They need support and investment that brings development from the farm up, not foreign investment that destroys their farms. ‘Large-scale land acquisitions during commodity booms can be particularly detrimental to social and economic development,’ write Vera Songwe and Klaus Deininger, the latter the lead author of a landmark 2011 World Bank report on large-scale land acquisitions.

And yet large-scale land acquisition during a commodity boom is precisely what is happening in West and Central Africa, where massive amounts of productive smallholder farmland and precious woodlands, forest fallows and biodiversity reserves are being taken over by Asian, European and North American investors. They’re keen to capitalise on the latest oil boom – one involving the humble African oil palm that is, sadly, threatened by the push to cultivate its ‘improved’ varieties on millions of hectares of precious African farmland.

When foreign corporations and nations descend on Africa to get at the continent’s oil, they tend to cause massive environmental, social and political disruption, and also conflict. But when they descend on the continent to get hold of massive amounts of arable land to produce palm oil for the world market, they are doing something even more egregious. They are taking control of the land and water on which the local people depend for their food production, livelihoods – their very survival.

*Joan Baxter is a journalist, development researcher and writer and an award-winning author who has lived and worked in Africa for more than 25 years. She is a Senior Fellow at the Oakland Institute. A version of this article was published by Pambazuka News on September 15, 2011. [IDN-InDepthNews – September 19, 2011]

2011 IDN-InDepthNews | Analysis That Matters

Follow us on Twitter and Facebook:

Related Posts

Begin typing your search term above and press enter to search. Press ESC to cancel.

Back To Top