Market-Based ISPO Certification and Garden Quality

Sustainability is relative and the world palm oil market also varies with the demands of sustainability attributes. Therefore a realistic sustainable certification system is based on the level of quality of sustainability, not sustainability vs unsustainability

The world’s palm oil market is not uniform. There is a market or country where the demand for sustainability of palm oil is very tight and strong as markets in developed countries like Europe, North America and Australia. The market in which most high-income consumers (the rich), environmental sustainability, human rights and even animal rights have become part of welfare values. Therefore, consumers have demanded (demanding demand) on the attributes of palm oil not only sustainable, but also tracable.

At the other extreme, there is also a palm oil market where people (consumers) prefer price attributes. Palm oil markets in less developed countries and developing countries with relatively low population incomes such as the countries of Africa and South Asia, the attributes of palm oil demanded are the main attributes of price. For such a market, the crucial price of cheap palm oil and has not demanded more detailed attributes such as sustainable attributes.

Among high-income and low-income countries, there are also middle income countries such as Middle Eastern and Central Asian countries. In these middle-income countries, generally still prioritize price attributes, but also have attributed sustainability attributes though not as strong in high-income countries.

Meanwhile, in terms of palm oil production ie oil palm plantations, have different variations as well. There are oil palm plantations that have strong technological, human resources, management and financing capabilities that already have more advanced sustainability practices such as palm corporations (private and state-owned). These large corporations and even most of their gardens have been certified for sustainability by both the ISPO and the RSPO.

But many middle-class corporations are still improving sustainability governance. Even the largest group of people’s palm oil plantations, still working on improving the technical culture and sustainable governance, still needs time to produce the best sustainable palm oil.

Such diverse realities should be the basis for certifying the sustainability of palm oil. Sustainability is something that is relative rather than “black-and-white”, or Sustainable vs Unsustainable as it is today both ISPO and RSPO. The quality of sustainability of corporate palm plantations that have been second generation and so on, of course different quality with the palm oil gardens are still the first generation. Also, the quality of sustainability of oil palm gardens in mineral land is certainly different from the sustainability quality of peat land gardens. Therefore, to equate the quality of sustainability of all palm oil gardens is not realistic.

With such market (consumer and producer) realities, sustainable palm certification will be more realistic and objective based on sustainability quality. For ease, for example Silver quality (beginner sustainability quality), Gold (advanced sustainability quality) and Platinum (sustainability advanced quality). The criteria for each sustainability quality level are set in such a way that it clearly shows the improvement of sustainability quality from Silver to Gold class and to Platinum.

Oil palm gardens that have achieved the quality of class I, II, III gardens according to Permentan no. 07 / Permentan / OT.140 / 2/2009 concerning the assessment of the plantation business obtaining Silver certification. To achieve a Gold certification there must be improved governance improvements. And furthermore to achieve the quality of Platinum certification also after the improvement of the quality of the gardens management is better.

Palm oil produced from gardens that have been certified as sustainable Platinum, is aimed at markets where very stringent sustainability demands such as the EU and USA. Likewise the Gold class, marketed to the middle-income market countries that have not been too “fussy” about the quality of sustainability. Silver classes are marketed to low-income countries where consumers have not demanded sustainability.

Such a palm oil certification system is far more realistic, fair, honest, transparent and sustainable. Current palm oil certification systems both ISPO and RSPO do not value different consumers’ demands and diverse oil palm plantations.

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