Environmental Effects of Oil Palm Plantations
Background Information

Global Demand for Palm Oil

The oil palm (Elaeis guineensis) belongs to one of the most dominant and productive crops in the world^[9]. As its main product, the oil palm provides fruits on fresh fruit bunches that are harvested throughout the whole year.

Figure 6: Fresh fruit bunches of oil palm.

The orange fruits are pressed, and the oil is used in a variety of products, such as biofuel, cosmetics or processed food (for example in cereal, biscuits, peanut butter).

Palm oil is often described as superior compared to other vegetable oils, due to the plant's high yields combined with lower production and management costs^[10][11]. Global demand has risen by 45% during the last two decades. The area of oil palm plantations has expanded accordingly^[12]. Currently, Indonesia is the world's biggest producer of palm oil, as it provides 57% of the global production^[5]. Given the rising demand for cheap oil for biofuel and food production, this percentage is projected to further expand in the future^[13].

Oil palm management compromises selection and clearing of land, seed germination and nurseries, planting strategy, maintenance, harvest, storage, and distribution^[14][15].

Oil Palm and the Environment

Despite being a very productive and cheaply manageable crop, there is rising concern about the environmental effects of oil palm expansion. The conversion of forest to oil palm plantations is often associated with negative effects on the environment, such as deforestation, loss of ecosystem functions and loss of biodiversity ^[18].

Figure 7: Deforestation of rainforest for future oil palm plantation.

One ecosystem function highly affected by oil palm plantations is soil fertility. It can be defined as the “capacity of the soil to provide sufficient nutrients for plant growth” ^[20]. Generally, monoculture oil palm plantations have lower soil fertility compared to tropical rain forests. After land-use change from forests to oil palm, the capacity of the soil to support high levels of crop production has decreased in oil palm plantations. Then, this is maintained by the continuous use of fertilizer. Furthermore, large scale conversion of forests has led to losses of biodiversity. For instance, Indonesia's exceptionally high biodiversity is seriously threatened by land conversion, for which oil palm cultivation is a major driver^[21]. Hence, there is a need to establish oil palm plantation management practices that support long-term soil fertility and biodiversity without sacrificing the yield.