Although the international palm oil industry and the big producers should be able to deliver insetting services to the smallholders contracted to big estates, a variety of commercial, NGO, and government activities will be needed to bring services to the independent smallholders. The Sabah Forestry Department has been promoting the cultivation of fast growing, indigenous timber species, such as Laran (Neolaba) and Binuang (Octomeles sumatrana) on private land. 2005). Despite a very attractive market prospect for these trees, their wood is used for veneer and pencils, the lack of market structures and financial support systems during the long gestation periods of about 12 years, make these trees not a viable option for most smallholders. In Brazil, NATURA, a major Brazilian cosmetics company that relies heavily on palm oil, in collaboration with Embrapa, the Brazilian national agricultural research agency, and CAMTA, a farmer’s cooperative, have started to integrate oil palm with cacao, despite the general perception that palm oil is not suitable for intercropping. Oil palm yields are reported to be higher than in same-aged conventional monoculture systems, while cacao yields are promising as well (Miccolis et al. 2014). Since 2005, global cacao prices have increased on average by 27% (ICCO 2015). Over-reliance on West Africa beans, which is notorious for severe structural problems, is putting the coca and chocolate industry at a potential risk (Squicciarini and Swinnen 2016).
Despite the often cited claim that oil palm is the golden crop that lifts people out of poverty (Simeh and Ahmad 2001), small land sizes paired with unsustainable management and resulting low yields keep a significant number of farmers at low profit , McCarthy 2010)
It could be argued that insetting is nothing new. Sustainability and social activism has been spreading to supply-chain management for some time, and many business corporate social responsibility (CSR) activities could be described as insetting. However, livelihood insetting describes a form of CSR that has matured from a narrowly defined CSR whereby activities were add-ons to the business as usual, to an actual shift in the business model itself aiming to create values for all the participants in its business ecosystems (Tencati and Zsolnai 2009).
Discussion and Conclusion
The RSPO has been instrumental in catalyzing a global dialogue between oil palm producers, traders, and consumers about environmental and social issues along the oil palm value chain (Kell 2014, Butler 2015). Its success can be counted by the number of RSPO members, the volumes of CSPO produced, and the number of certified supply chains, but in an ever-expanding market that is rapidly spreading its production into https://miro.medium.com/max/1200/1*u1m2U265Jp2YXb2UYmbDsg.png” alt=”citas en lГnea ecuestre”> new areas and new forested countries, these successes seem to be little more than a Red Queen’s race. Despite commitments to zero deforestation and sourcing of 100% certified sustainable palm oil certification, roundtable initiatives have yet to achieve industry-wide adoption rates in light of small price premiums, commodity characteristics (nondifferentiation), and political challenges within the main producing countries (Butler 2014, Ghazoul 2015, Jacobson 2015). Although consumer concerns and activist campaigns have been successful in constraining the use and access of conventionally produced palm oil to the European market, sustainability issues still emerge as a factor for market access in India and China, the main ).
Unlike other major oil commodities, palm oil is grown by more than 3 million smallholders living in middle or lower income countries, contributing to an estimated two-fifths of the world’s palm oil (Balch 2013). Unfavorable farming contracts and loss of autonomy over their land restricts a large number of smallholders to oil palm only, making them vulnerable to production and price shocks (McCarthy 2010, McCarthy and Zen 2010, Cahyadi and Waibel 2016).