Executive director of the Indonesia Sustainable Palm Oil (ISPO) Commission Rosediana Suharto says that 10 more oil palm companies have obtained the mandatory ISPO certificates, making 20 certified firms in total.
Rosediana said the commission had issued certificates for the oil palm companies, which were among the 15 audited companies applying for certification this month.
“The companies include Wilmar, Best Agro and Astra. Other companies failed to secure certification mostly due to legal matters,” she said on the sidelines of the 5th Palm Oil Summit in Jakarta on Tuesday.
She said the commission has set a target to have at least 50 oil palm companies acknowledged as firms with sustainable production practices, but most companies are facing legal problems, such as permit issues that conflict with local regulations.
She added that only 120 companies had applied for the certification, despite the fact that around 1,200 palm oil companies were subject to the mandatory certification.
Rosediana said the agency planned to register all palm oil companies in the country by the end of 2014, and to have all the companies certified by 2020.
The company has also projected to have individual smallholders and plasma plantation smallholders certified, the former will be funded by the government.
The government-backed ISPO certification program was unveiled in late 2009 after consumer product giants suspended crude palm oil (CPO) purchases from several major Indonesian suppliers for alleged deforestation practices in their expansions.
Palm oil plantations have long been a major cause of deforestation.
The program was set to be mandatory for all oil palm plantations, it resulted in punishment — mainly administrative measures — for those failing to comply with the rules.
This country is the world’s largest palm oil producer with an annual output of over 26 million tons of crude palm oil, with a total plantation area of 9 million hectares.
Trade Ministry data said CPO contributed US$19.35 billion in exports last year, more than half of total plantation exports, which reached $31.7 billion. CPO was also the biggest export commodity in the plantation sector with around 20.57 million tons exported in 2012.
The ministry estimated that CPO production would increase to 24.4 million tons this year.
The government has previously stated that it wanted the certification to be regarded as the requirement for the voluntary international certification program from the Roundtable Sustainable Palm Oil (RSPO), the two of which had sometimes been regarded as conflicting.
Rosediana said that according to the commission’s study comparing the two certification programs, which will be concluded this month, she acknowledged that “some principles of the programs might be needed to work on”.
The principles that “needed to be worked on” include land optimization, which, while ISPO wants plantation to fully maximize their areas, RSPO stipulates that companies should dedicate their land for conservation.
Rosediana acknowledged that the certification might not yet result in economic benefits for certified companies, saying that such benefits will be “a blessing in disguise with no premium price set for sustainable palm oil”.
“This certification is aimed at promoting environmental sustainability and not economic growth,” she reiterated.
