Who's Responsible for Palm Oil Deforestation—Small Farmers or Big Companies?

November 10, 2015
Doug Boucher
Former contributor

In recent days, with massive fires in Southeast Asia again creating the dangerous haze that endangers the health and lives of millions, we’ve seen the recurrence of the claim that fires and deforestation are caused by small farmers, not big companies and their plantations. For example, Siti Nurbaya Bakar of Indonesia’s Environment and Forestry Ministry told the Jakarta Globe that the pledge by palm oil producers to end deforestation was “too restrictive on Indonesian smallholder palm oil producers” who wouldn’t be able to afford it.

This is a manifestation of an old narrative: that deforestation and environmental destruction are the fault of the poor. Since they’re doing this “just to feed their families,” it would be unjust to stop them, and since the big companies aren’t the ones to blame, it wouldn’t do any good to go after them either. So: too bad, but nothing can be done.

This story is often repeated, not only in Southeast Asia about palm oil but throughout the tropics, and has sometimes been influential among people who feel torn between their love of the environment and their dedication to social justice. But, is it true? Here’s what the scientific evidence shows.

Last year, an important paper on the subject was published in Conservation Letters by Janice Lee and colleagues that looked at just this question. Using data from Sumatra covering the period 2000-2010, they found that smallholders were responsible for just 11% of the deforestation, even though their farms covered about 40% of the land in oil palm. Large private enterprises, on the other hand, caused 88% of the deforestation. In terms of greenhouse gas emissions, the figures were almost identical: 9% and 90%. So it’s overwhelmingly the big companies that are destroying forest to create oil palm plantations and causing dangerous climate change.

A related recent study was done in Peru by Victor Gutierrez-Velez and colleagues, and was published in 2011 in Environmental Research Letters. They found that, while large landowners had higher palm oil yields than small farmers, they nonetheless destroyed much more forest because they preferred to get large concessions in forested regions rather than expand onto already-cleared land.

Most of the deforestation due to oil palm is caused by large plantations. SOURCE: Sharon Smith, UCS.

Most of the deforestation due to oil palm is caused by large plantations. SOURCE: Sharon Smith, UCS.

These studies not only show that the narrative about who’s causing deforestation is incorrect. They also reflect broader, global issues about the unequal distribution of land. A recent background paper for the 2014 issue of the FAO’s State of Food and Agriculture report estimated that the world has somewhat over 570 million farms, and the vast majority of these are very small. In fact, more than 475 million of them are less than 2 hectares (5 acres) in size, and more than 410 million are less than 1 hectare. But while 84% of farms are under 2 hectares, they control only 12% of global farmland.

Another part of the puzzle comes from an important 2010 study in Nature Geoscience, by Ruth DeFries and colleagues. They showed how the causes of deforestation have changed in the 21st century. It’s not driven by peasant farmers producing for their own subsistence, but predominantly by large-scale commercial farms, ranches and plantations producing commodities for urban and export markets.

Taken together, this evidence shows that if we keep on repeating the 20th-century narrative about the causes of deforestation, we’re blaming the wrong people and giving the large and mid-size companies a pass. This story was effectively rebutted in Indonesia by Mansuetus Darto, who chairs Indonesia’s Oil Palm Smallholders Union (SPKS). The government is using “the welfare of oil palm farmers” to oppose attempts to reduce deforestation, he told the Jakarta Globe, while failing to address smallholders’ real problems. He pointed to an Agriculture Ministry regulation that prevents palm oil farmers from getting bank loans, and the ending of both training for them to increase their yields and the provision of good-quality seeds that would allow them to do this.

Darto concluded, “The real focus should be on how to increase productivity instead of expanding the plantations.” He’s absolutely right.