Commodities

Indonesia plans new agency to bolster palm oil certification

Reuters Indonesia | Updated on October 31, 2019 Published on October 31, 2019

Indonesia, the world's biggest palm oil producer, plans to create a new agency to conduct independent audits to bolster credibility in its palm oil sustainability certification, the country's deputy coordinating minister of economic affairs said. The $60 billion global palm oil trade has come under fire from environmentalists because of the vast areas of tropical rainforest they say have been cleared to grow the commodity that is consumed by billions of people.

Indonesia and other producers like Malaysia face new European Union (EU) rules dictating that palm oil should be phased out from transport fuel in the bloc after it concluded that it causes deforestation.

“The new agency would be aimed at improving the credibility of the Indonesia Sustainable Palm Oil certification (ISPO) certificates,” Deputy Minister Musdhalifah Machmud told a palm oil conference in Bali.

ISPO is supposed to guarantee that land used for palm oil is legally owned, does not encroach on forests and is cleared using good agriculture practices, not slash-and-burn methods.

Some environmental groups, however, view ISPO as weaker than international certification schemes.

The new agency was included in a revised regulation now awaiting President Joko Widodo's approval, said Machmud

Published on October 31, 2019
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