Promoting sustainability in the palm oil industry
At Solidaridad, we’re convinced that the only way to create a truly sustainable supply chain for palm oil is for partners from across the value chain to support progress on the ground – and include smallholders and workers in this process. Henkel has shown that it understands this, and is committed to building inclusive and sustainable supply chains. We’ve been working together since 2013 to promote sustainability and support smallholders in Ghana, Honduras, Indonesia, Mexico, Nicaragua, Nigeria – and now also in Colombia. This latest project will develop and test an innovative digital platform called Farming Solution.
Palm oil cultivation as driver of development
Oil palm trees are an increasingly important crop in South America, with about half a million hectares used to grow the crop: The flesh of its fruit is harvested to produce palm oil, while the seeds are used to produce palm kernel oil. There are around 5,000 smallholder farmers in Colombia alone. Palm oil and palm kernel oil have the potential to be a significant driver of development for rural communities when it is grown in accordance with best agricultural practices – and in a socially and environmentally responsible way.
Challenges for smallholder farmers
Farms belonging to smallholders in Colombia produce about 40% less palm oil per hectare than larger plantations. Smallholders often have limited knowledge of the most effective farming practices, like which fertilizers are best to use or which seed varieties provide the highest yields. They also often have limited access to capital that they can invest in improving their farm. This lack of knowledge and investment results in lower yields – and lower incomes.
Smallholders also face challenges related to the increasing demand for materials that are certified in line with the standards of the Roundtable on Sustainable Palm Oil (RSPO). Buyers increasingly consider uncertified palm materials to be a potential challenge – which limits smallholders’ ability to sell their product and reduces the price they receive. Many small farmers find it difficult to achieve certification for their crops without external assistance.
Applying best practices can triple yields
Solidaridad supports palm oil farmers and processors with the implementation of best practices and compliance with requirements like those from the RSPO. Our approach has been able to double or even triple the yields in some regions. This can have an enormous positive impact on the income and livelihood of oil palm farmers: For example, enabling them to send their children to school or university.
The Farming Solution tool
Our digital tool, Farming Solution, allows farmers direct access to the valuable information they need to improve practices on farm – without additional costs. This allows us to reach more farmers with information about better practices. Here’s how it works:
- Farmers conduct a self-assessment of their agronomic, business, social and environmental performance.
- Based on their answers, farmers receive instant feedback and a set of recommendations.
- The tool provides access to an online library with relevant supporting materials.
- Once farmers reach an advanced level, those interested in certifying their production can access a full certification checklist. This can help them benchmark their practices against the RSPO requirements.
Support from a large global company like Henkel shows the importance of sustainability in the entire palm oil industry and can inspire farmers to improve their practices. Henkel is going beyond certification and playing a leading role in driving tangible improvements on the ground.
To date, around 36,400 smallholders have been reached on some 340,000 hectares under cultivation. These numbers are substantial – but there is still potential for growth. Palm oil cultivation is estimated to cover around 27 million hectares globally, and there are around 2.2 million oil palm smallholders worldwide.
Scaling our impact
If we’re able to successfully achieve widespread adoption of sustainable farming practices, it will make a significant contribution to solving major challenges such as ensuring global food security and creating opportunities for development in rural areas. It is essential that this is achieved without converting valuable ecosystems to farm land – a practice often associated with the palm oil industry.
The key challenge now is bringing our small project interventions to scale. Digital tools such as Farming Solution can play an important role in achieving this goal. As Solidaridad, we are proud to cooperate with companies like Henkel and co-create solutions to bring our common vision of sustainable palm oil to life.