KUALA LUMPUR, July 20, 2015:

Sabah aims to produce 100% Roundtable on Sustainable Palm Oil (RSPO) certified palm oil by 2025 – which would make it the first sub-national or state entity to fully commit to producing 100% RSPO certified palm oil.

The state is currently responsible for 12% of the world’s palm oil, making it one of biggest global players – with production coming from small stakeholders to some of the biggest palm oil companies in the world.

But the presence of small stakeholders to big players has made a state-wide certification approach challenging, since smallholders typically cannot afford the cost of certification.

State officials look to overcome these challenges to differentiate Sabah’s palm oil from other producers, especially given the rise in the number of companies that have adopted social and environmental safeguards for palm oil sourcing.

“Both global demand and downstream industries will increasingly pull the supply chain for certified sustainable palm oil and Sabah must act to be ahead of the curve,” said Sabah Forestry Department director Sam Mannan.

“With time, large competitors will inevitably outpace Sabah’s total output of palm oil. But with certification, Sabah can build itself as a niche producer of a branded good certified palm oil, and compete on the basis of governance and not size.”

Studies have also suggested that the value of such certification efforts would provide dividends beyond public relations value by shifting adopters toward more efficient practices and bringing supply chains in line.

Cynthia Ong, director at Forever Sabah, an initiative that aims to fundamentally shift Sabah’s economy from resource extraction to sustainable enterprises, said: “Research shows that productivity of producers, especially smallholders, can increase dramatically after certification, allowing Sabah to gain in yield while also making conservation gains.”

Another important trait of the RSPO certification is that Sabah’s remaining forests – home to orangutans, pygmy elephants, clouded leopard, and proboscis monkeys, among other endangered species – would remain safe as the certification bars its palm oil producers from touching high conservation value areas.

“Jurisdictional certification will also draw bright lines to protect forest reserves, wildlife corridors, high conservation value forests, riparian reserves and improve connectivity in a more coherent manner,” said Mannan.

Palm oil is often blamed as being one of the largest drivers of deforestation in Southeast Asia.

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