Agri Business

Opportunity for sustainable oil palm cultivation through smallholding farmers in AP, Telangana

Nasim Ali | Updated on: Jan 16, 2022
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Both governments have made cultivation of the crop successful

The edible oil industry in India is very strategic in nature. Palm oil and its derivatives become most important, because of its highest consumption and affordability due to the highest oil yield production per hectare. Palm oil alone constitutes more than 37 per cent of edible oil demand in India and 60 per cent of the import basket.

Till 2020-21 fiscal, around four lakh hectares (lh) of land were brought under oil palm cultivation through land-owning farmers, out of which Andhra Pradesh and Telangana together brought more than two lh oil palm cultivation through farmers. The Government of India further initiated to improve its growth towards large scale plantation to the extent of an additional 6.5 lh by 2025-26 through smallholders by launching a sustainable mission-NMEO-OP in the month of August 2021, after critical analysis of the various challenges faced by farmers. The governments of Telangana and Andhra Pradesh made oil palm cultivation successful and sustainable through smallholder (SH) farmers over a period in association with processors.

Encouraging report

A company (a leading manufacturer of speciality oils and fats who achieved global leadership by offering sustainable growth through expertise in diverse business areas) is committed to responsible sourcing of palm oil globally, including from SH farmers and they engaged a third party to carry out field test by focusing smallholder farmers plantation independently during 2017 in Andhra Pradesh and Telangana under Godrej Agrovet Limited (GAVL) factory zone, along with geospatial risks assessment based on locations of two palm oil mills of GAVL. These two mills sourced from farmers in AP and Telangana, cover more than 29,000 farmers over 28,000 hectares. They supply raw materials used for the manufacturing of crude palm oil. The test report was very encouraging indeed against following the Code of Practices (COP).

Many oil palm developers and Processors in Andhra Pradesh and Telangana developed COP for small holders. This COP serves as a benchmark to assess whether smallholder practices conform with various core issues pertaining to sustainable palm production and the support they require to meet their needs. This COP includes and confirms the items such as land rights and legislation in place, no deforestation and no conversion of High Conservation Values (HCV) and High Carbon Stock (HCS) forests. During this field survey/test, it was also found that there is hardly any evidence of burning carried out by farmers during planting and replanting stage, the large areas of the landscape are dominated by agricultural land and forests are scattered throughout the landscape in small fragments, like eucalyptus plantations and some areas also remain forested where there is elevation. No child labour was engaged and traceability to the farmers is crystal clear. Labour rights and working conditions, smallholders want and need for their livelihood etc. also reviewed during this study. It has been proved that oil palm provides assured and sustainable income to the small holders round the year.

In India, the government in association with oil palm processors plays a pivotal role in the palm oil sector by developing and practising certain frameworks within which the various stakeholders operate, like fixation of Fresh Fruit Bunches (FFB) pricing, subsidy, training & capacity building, farmers registration process, active agronomic support, opening of bank accounts, financial assistance through banks, regulation of FFB supply and farmers yield improvement etc.

Improving standards of living

Farmers have greatly benefited from oil palm production, which can be evidenced through their increase in revenues (which they receive every 15 days ) when compared to their earnings over a decade ago. This has undoubtedly improved the standard of living of smallholders and farm labours, who are now able to make effective planning for their future, like savings for their children’s education, investing in house construction and purchasing two-wheelers by farm labourers and smallholders respectively.

Of course, there are certain challenges for SH farmers to meet sustainable policies and responsible sourcing commitments. The following areas where there is a need for improvement are:

1. Minimum wages paid as per National Standard or industry benchmark, whichever is higher and should be enough to meet the basic needs, as far as labour rights are concerned.

2. First aid kit, drinking water and toilets etc. should be made available at cultivation area and Personal Protective Equipment (PPE) for workers during their operation.

3. Safety training for workers from time to time.

‘Actual protectors’

Certain misleading perceptions are developed by certain groups based on the patchy data, sporadic incidences and manipulating information. Actual protectors are our smallholders who raise oil palm cultivation through crop conversion and without touching forest cover. Those who really protect, do not require to preach about environment protection and social development.

We should be open to all possible areas of improvement, since today’s agritech around the world has reached the level through its R&D towards resolving various environmental issues with ultimate aim of improving farmers economy and maintaining best ecosystem, otherwise, lack of reliable data will derail any policies and mission. It may not be out of place to mention here that India is the first country in the oil palm world where scientists proved that oil palm can be grown successfully through the micro-irrigation system, intercropping with other crops like cocoa, pepper, turmeric etc. and introduced high yielding plant material. Oil palm has been grown successfully here through farmers in large scale for the first time in oil palm world and it has been made commercially viable and sustainable for smallholder farmers.

Besides the above, palm oil processors started working on value-added products like aqua feed and animal feed out of oil palm biomass by converting waste to wealth commercially. There are also opportunities for down stream production of palm oil through food processing units and biofuel production which will reduce dependence on fossil fuel imports and its emissions. Ultimately, all these will help the country’s economy and reduce dependence on others.

The writer is former CEO-Oil Palm Plantation, Godrej Agrovet Ltd. Views are personal

Published on January 15, 2022

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