Abstract
Rising global demand for vegetable oil during the last few decades has led to a drastic increase in the land area under oil palm. Especially in Southeast Asia, the oil palm boom has contributed to economic growth, but it has also spurred criticism about negative environmental and social effects. Here, we discuss palm oil production and consumption trends and review environmental, economic, and social consequences in different parts of the world. The oil palm expansion has contributed to tropical deforestation and associated losses in biodiversity and ecosystem functions. Simultaneously, it has increased incomes, generated employment, and reduced poverty among farm and nonfarm households. Around 50% of the worldwide oil palm land is managed by smallholders. Sustainability trade-offs between preserving global public environmental goods and private economic benefits need to be reduced. We discuss policy implications related to productivity growth, rainforest protection, mosaic landscapes, land property rights, sustainability certification, and smallholder inclusion, among others.
Highlights
Oil palm (Elaeis guineensis) is one of the world’s most important oil crops
In Indonesia and Malaysia, around 60% of the oil palm area is managed by large private and public companies that hold long-term land concessions issued by the state; the rest is managed by smallholder farmers (Byerlee et al 2017, Euler et al 2016b, Jelsma et al 2017)
We focus in more detail on Indonesia, where we have ourselves collected data on biodiversity and ecosystem functioning for many years
Summary
Oil palm (Elaeis guineensis) is one of the world’s most important oil crops. It is cultivated throughout the tropical belts of Africa, Asia, and Latin America and is widely traded internationally. Recent research with data from Indonesia showed that oil palm contributes to rising farm and employment incomes and reduced poverty rates at local, regional, and national levels (Bou Dib et al 2018b, Edwards 2019a, Kubitza et al 2018a) These positive economic and social effects are rarely mentioned in the public debate, possibly because they do not fit the popular narrative of oil palm being a major evil (Edwards 2019a, Meijaard & Sheil 2019). Due to the breadth of topics covered, Byerlee et al (2017) hardly discuss the increasing number of microlevel studies on the environmental, economic, and social effects of the oil palm boom. This is what we do in the present article. While we cover evidence from all parts of the world, we put particular emphasis on Indonesia, because Indonesia is by far the largest palm oil producer worldwide, and because of the existence of a large interdisciplinary research project on land-use change in Sumatra that we have been involved in for several years (Clough et al 2016, Drescher et al 2016, Krishna et al 2017b)
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