Slowing deforestation in Indonesia follows declining oil palm expansion and lower oil prices

Abstract

Much concern about tropical deforestation focuses on oil palm plantations, but their impacts remain poorly quantified. Using nation-wide interpretation of satellite imagery, and sample-based error calibration, we estimated the impact of large-scale (industrial) and smallholder oil palm plantations on natural old-growth ("primary") forests from 2001 to 2019 in Indonesia, the world's largest palm oil producer. Over nineteen years, the area mapped under oil palm doubled, reaching 16.24 Mha in 2019 (64% industrial; 36% smallholder), more than the official estimates of 14.72 Mha. The forest area declined by 11% (9.79 Mha), including 32% (3.09 Mha) ultimately converted into oil palm, and 29% (2.85 Mha) cleared and converted in the same year. Industrial plantations replaced more forest than detected smallholder plantings (2.13 Mha vs 0.72 Mha). New plantations peaked in 2009 and 2012 and declined thereafter. Expansion of industrial plantations and forest loss were correlated with palm oil prices. A price decline of 1% was associated with a 1.08% decrease in new industrial plantations and with a 0.68% decrease of forest loss. Deforestation fell below pre-2004 levels in 2017-2019 providing an opportunity to focus on sustainable management. As the price of palm oil has doubled since the start of the COVID-19 pandemic, effective regulation is key to minimising future forest conversion.