Thursday, November 27, 2008

The Science is on the side of Palm Oil

Palm oil's success in penetrating the world market in a dominant way over the last three decades was due to its popularity for use in food and oleochemical sectors. Initially producers of competing oils felt threatened by the rapid advancement in the market share of palm oil. This resulted in deliberate campaigns mounted in the USA in the 1980s to discourage the importation of palm oil.

Health issues were used as a disguise to set up trade bariers linking palm oil to saturated fats as these fats were known to raise cholesterol levels. However, these claims were not supported by any well designed nutritional studies. On the contrary many comparative studies showed the neutral or lowering effects on cholesterol by a palm oil diet especially when compared to coconut oil or fats in the habitual western diet.

In other studies when the liquid olein of palm oil was compared with (liquid) olive oil or (liquid) canola oil, the cholesterol lowering results were similar.Similarly, blends of palm olein with soya and /or canola oil, had a beneficial effect of improving the ratio of good HDL (high-density lipoprotein)to bad LDL (low-density lipoprotein) cholesterol. Such findings have been patented and products made under such patents in the USA are allowed by the Foods and Drugs Authority(FDA) to carry the label "Patented blend to help improve your cholesterol ratio."

With the growing interest in the detrimental effects of trans fatty acids(TFA), studies comparing palm oil and TFA were conducted. It became clear that trans fatty acids have the dual negative effects of increasing the bad LDL cholesterol and reducing the good HDL cholesterol, while palm oil has the effect of raising the good cholesterol, and lowering or having a neutral effect (non significant increase) on the bad LDL cholesterol. This led experts to conclude that palm oil is a reasonable alternative to TFA especially when fat products are required for funtionality purposes.

Trans fats are produced by hydrogenating soft oils to make them solid for use in baking and margarines. Hydrogenation produces artificial TFA which cause the double negative effects on cholesterol levels. The health authorities in the USA are discouraging the consumption of TFA containing fats. TFA have been scientifically linked to the incidence of heart disease.

Based on these scientific studies, the entire anti palm oil campaign machinery in the USA did not succeed in dampening the palm oil demand because science was and continues to be on the side of palm oil.

There are those who will argue that the poly-unsaturated oils will reduce cholesterol more than palm oil. This question was actually investigated by comparing palm oil and corn oil against coconut oil as a positive control. The study revealed that palm oil raised the good HDL cholesterol and reduced the bad LDL cholesterol. Although corn oil reduced the bad LDL cholesterol more than palm oil but it also reduced the good HDL cholesterol when tested against the coconut oil control. This study clearly indicated that corn oil does not help improve the cholesterol ratio. These scientific results make it difficult for any expert to conclude that corn is better than palm oil or vice versa.

Numerous scientific studies showed that palm oil although having up to 50% saturated fatty acids does not behave as a saturated fat in that it does not raise cholesterol levels like saturates. Studies were conducted to help explain the "unexpected" non-cholesterol raising effects of palm oil. One study found that as long as there is a small percentage presence of unsaturates (as usually is the case in practice because the body receives blends of oils and fats), palm oil is non cholesterol raising in its behavior. Others postulate that palm oil molecules have unsaturated fatty acids occupying the middle position of the three glyceride carbon chain, and this unsaturation makes palm oil non cholesterol raising.

The beauty of science based studies is that the results are repeatable. References to these studies can be easily made available in case such experiments need to be repeated.

But this is not the case in the current practice of NGOs who offer their unsubstantiated opinions and provide only incomplete evidence relating to the environmental debate on palm oil. The anti-palm oil campaigns conducted by some so called environment friendly European NGOs failed to provide concrete proof on deforestation effects of palm oil. (Showing pictures of legal agricultural land under preparation for oil palm planting is no proof of deforestation).

Despite the resouces available in the EU there is no systematic scientific study on the carbon dioxide emission saving on palm oil based biofuel. A pathetic (non-scientifically derived) carbon emission saving figure of 32 % was arbitrarily assigned to palm oil to make it fall below the thresh hold level of 35 % which is used as the minimum level accepted for biofuel raw material in the EU. Ironically, rapeseed oil in the EU qualified because some "experts" assigned it a default carbon emission saving figure of 36 %. If proper LCA studies were indeed conducted and the carbon sink properties of the oil palm trees and the deforestation avoidance effect of palm oil were accounted for, the carbon emission saving figure for palm oil biofuel would be more than 100%, making it the ideal renewable biofuel. Again, in these postulations, the science favours palm oil. Eventually the truth will prevail despite the manipulation of carbon emission saving figures for palm oil in the EU.

Overall, the current anti-palm oil campaign conducted by some NGOs in the EU seems to attack the agricultural sector of a developing country like Malaysia. If the EU governments manipulate the emission saving figure to disqualify palm oil from being used as normal raw material for biofuel, they too are guilty of colluding with the NGOs by setting a trade barrier against the agricultural produce of a developing country. If the palm oil producing countries in turn were to retaliate by not favouring the importation of EU produced cars in preference for Japanese and Korean cars makers, the world's current economic recession will likely last longer, especially in Europe.

Even though Malaysia designates a small portion of its land area for agriculture(less than 25% of its total land) and oil palm is an agricultural crop, the NGOs and some environmental scientists still insist on criticizing the oil palm plantation as not having high biodiversity like the forest. Why can't these commentators be fair and match apples with apples by comparing oil palm plantations with other agricultural crops? They also insist that palm plantations will destroy forests. Again, all agricultural land in Malaysia must be derived from the clearing of an original forest, and no body is denying that because a country like Malaysia will try to develop its agricultural sector to an optimum level for example by planting oil palm on degraded land that is suitable and zoned for agriculture.

In reality a hectare of oil palm plantation will produce on average 4 tonnes of palm oil and when this is imported by other countries, it will save them from cutting 10hectares of forest if they were to grow their own soyabean crop to produce 4 tonnes of oil equivalent. Oil palm plantations have an indirect land use effect of saving ten times more forest area in the importing countries when they import their palm oil from Malaysia. This is referred to as the deforestation avoidance effect.

For those opposed to the development of biofuel, it is good to know that the oil from one hectare of oil palm plantation provides the longest travel on a standard car compared to any other biofuel including ethanol from sugarcane (or at least 10 times more distance than the oil from a hectare of soyabean). Countries such as Malaysia should feel lucky in having plenty of palm oil based biofuel to cater for its need in future when fosil fuel continues to be a scarce commodity.

Malaysia has its own biodiesel policy and technology. It needs to develop the local use of palm biofuel to reduce dependency on fossil fuel, and as a palm oil producer, there is a need to find new applications of palm oil to increase its market value. The announcement by the Malaysian Government to undertake mandatory blending of palm biofuel with petroleum diesel starting from February 2009 and the implementation of this policy means that palm biofuel market is no longer restricted to exist only in the EU .

The demand for biofuel will unlikely lead to deforestation in Malaysia as implied in the allegations by some of the EU NGOs. Why should Malaysia jeopardise its forests to accede to the wishes of the EU to meet its biofuel targets. In practice,palm oil will be available for biofuel to the world only when its use as food is already fulfilled and the excess (which causes prices to fall) will be cheap enough for use as biofuel. At most other times, palm oil will likely be expensive for use as biodiesel, since food demand due to chronic shortages of supply faced by most countries of the world will force palm oil prices to increase. Only Malaysia and Indonesia are major net exporters of oils and fats, (mostly palm oil), and Argentina is a distant third as a net exporter of mainly soyabean oil, while most other countries are net importers of oils and fats. This time, not only will the science favour palm oil in the environmental debate, the lack of alternative large sources of oils and fats availability also favour palm oil from Malaysia and Indonesia to remain the major source of supply to the world market whether for use in food or biofuel.

Sunday, November 9, 2008

Creating a fine balance for development, food security and environment sustainability.

In the ongoing sustainability debate, it is important for a developing country to ensure a fair balance between the need to develop its economy, produce sufficient food for its people and preserve the environment for sustainable development. Unfortunately, for environmental NGOs, the one-sided focus on only the environment projects an extremely unbalanced viewpoint.

Malaysia, as a developing country, has been successful in bringing about this balance by continuing to invest in the agricultural sector, in addition to developing its manufacturing, tourism, IT and services sectors. For a developing country, land is always identified as an asset that can be developed both to generate revenue and to achieve food security. If all these developments are carried out in a sustainable manner, the environmental preservation and conservation objectives are eventually fulfilled.

The contributions of palm oil and rubber to the Malaysian economy range from 5 to 8 % of the country's GDP. These two commodities not only helped Malaysia to fight the malaise of poverty but also provide the much needed food and income for the rural communities. Globally, palm oil and rubber from Malaysia are vital commodities to meet the world's industrial and food needs. For example, tyres for aeroplanes and large transportation vehicles have to be made with a high percentage content of natural rubber. Malaysia's contribution is significant as it is the world's major exporter of natural rubber. Similarly, more than 150 countries depend on palm oil from Malaysia for their supply of vegetable oils and fats for cooking, frying, making margarine and bakery fats, oleochemicals and other uses. While 55% of world oils and fats exports are accounted for by palm oil products, Malaysia alone supplies an estimated 30 %!

The major food items of the world are fats, proteins and carbohydrates. Producing palm oil (a fat) is what Malaysia does best with its agricultural land. On the other hand Malaysia has no natural advantage in producing the other two food components ie proteins and carbohydrates which the country imports using excess income from the exports of palm oil. Simple economics therefore tells us that the country achieves food securinty in fats, proteins and carbohydrates by importing the latter two using the excess income from the exports of the former.

It is crucial for a developing country to have an assurance of food security especially by employing its most important asset- agricultural land. Such an assurance makes it easier for the country to develop its other economic sectors. One often sees failures to develop a country's economy when food insecurity prevails, and such countries often have to depend on foreign food aids.

Oil palm happens to be an efficient and high yielding agricultural oil crop. To produce the current 20 million tonnes of palm oil and palm kernel oil products, Malaysia only employs 4.5 million hectares of agricultural land or 13.6% out of the country's total land area of 33 million hectares. If the country were to produce 20 million tonnes of soyabean oil instead, assuming international yield capability of 0.4 tonnes per hectare, Malaysia would need 50 million hectares of land, which it obviously does not have.

Palm oil is now seen as the key to the successful formula used by Malaysia, as a developing country, to achieve a fine balance between bringing continuous development, achieving food security, and preserving the forests and the environment. A significant 60% of the total land area is still intact under permanent forest, most of which is subjected to sustainable forest management under the ITTO protocol.

A lack of appreciation of these achievements has led to unwarranted calls by certain environmental NGOs for a moratorium on deforestation based on their simplistic accusation that oil palm cultivation is associated with deforestation. If forest lands are already safeguarded by the existing laws of the country and are further subjected under international protocol to be sustainably managed, calling for moratorium on deforestation does not make sense and will be considered redundant.

Furthermore, it is also unethical , immoral and somewhat patronising for NGOs of the developed countries in Europe to ask developing countries such as Malaysia to stop developing its land. This will lead to conflicts and misunderstanding because some states in Malaysia have not yet had the opportunity to develop their agricultural land as they were until a few decades ago under oppressive colonial rule. Sarawak which achieved independence from the British later than Peninsular Malaysia had only developed 8% of its land for agriculture as compared to over 70%by the UK. But there are still opportunities in Sarawak and other parts of Malaysia to develop degraded logged over land for planting oil palm and rubber to increase the country's sources of foreign exchange while avoiding deforestation of its pristine permanent forests.

It is highly likely that the government and people of Malaysia are enlightened enough themselves to be more concerned than the EU NGOs and the EU governments on the need to preserve their pristine permanent forests for the benefit of the present and future generations. I would urge NGOs to refrain from campaigning against the use of palm oil as this is unfair to our farmers who have been exporting the agricultural produce for many generations in the past. Palm oil is an agricultural commodity that has been produced on agricultural land for generations, just like the production of rapeseed and soya in the EU countries.

It is even more perplexing to hear of attempts by irresponsible EU NGOs wanting to protest against the arrival of RSPO certified palm oil into the EU. Such a negative move should be condemned as RSPO is a sincere multi-stakeholders attempt to improve and ensure the sustainable production of palm oil for the export market. The establishment of the RSPO was initiated by NGOs like the WWF and the Malaysian palm oil industry gladly took up the challenge and proved sustainability was possible in a well organised sector that has long adhered to proper rules and regulations. RSPO has just started its sustainability agenda and further improvements can be anticipated. Instead these NGOs who seem to want to remain outside the RSPO fraternity could make a more positive contribution through offering their fertile ideas to improve palm oil sustainability if they join and become members of the RSPO. The Malaysian palm oil industry was hopeful that the RSPO, however imperfect, should be the platform to nurture and promote sustainability and not be the stage where non member NGOs undermine the sterling efforts by plantation company members who have been certified as capable of producing RSPO certified palm oil. It is time for readers to write back to these irresponsible NGOs to protest against their high handed approach in denying producers and farmers from a developing country access for their products to be exported to the EU market.

I would also like to encourage ill-informed environmental scientists not to compare the biodiversity of an agricultural crop such as the oil palm with that of rain forests. The findings would not win you a Nobel price. A fair comparison should be made with soyabean, rapeseed, corn or sugarcane or other agricultural crops. Biodiversity that exists in the oil palm plantations is a bonus for all to benefit, while we continue to enjoy a consistent supply of oil for our daily food needs, in addition to palm oil- an agricultural commodity - helping to promote economic growth not only in the developing countries but also in all other countries involved in using the product.