Sustainable Palm Oil
Introduction
Palm oil is considered one of the most valuable and profitable sources for different industries such as food, chemical products, and biofuels. The production and importation of it mostly come from plantations that are mainly located in Indonesia and Malaysia amongst other countries. The cultivation of palm oil, however, entails environmental risks, which include deforestation, displacement of indigenous inhabitants, and impacts on climate change that eventually drew the attention of various environment and sustainability-focused non-governmental organizations (NGOs).
Current Supply Chain for Palm Oil
Supply Chain Management is the active management of supply chain activities to maximize customer value and achieve sustainable competitive advantage. The practice of supply chain management is meant to develop and run supply chains in such a way as to reduce delays and unnecessary waste, as well as to foment right customer and supplier relationships. Activities covered under supply chain management include product development, sourcing, production, and logistics, accompanying these activities are the information systems necessary to integrate them. The events that fall under supply chain management represent the flow or movement of materials from raw sources to the final consumer. Supply Chain Management has the main objectives of increasing productivity, improving customer service, and controlling costs at each level of the product life cycle.
Palm oil is used almost everything that we use, including cosmetics, food, soap, cookies, chips, and the sandwich in supermarkets. The demand for palm oil has been rising gradually, although there are controversial issues about palm oil. It is because it involves the clearing of the tropical rainforests, which leads to deforestation (“Eco-Business,” n.d., para.1). They will then be replaced with the growth of the palm oil plantations. It is an activity that has destroyed the habitats for animals such as the orang-utan. As a result, biodiversity has been interrupted. The oil palm trees are known to produce oil ten times the other crops per hectare. The growth in demand for palm oil has created job opportunities for many people and producers.
Nevertheless, it has harmed the local people and wildlife (“conservation international,” n.d., para.1). This mainly applies to Indonesia and Malaysia. These are the issues that have led to the development of sustainable palm oil. Sustainability is the ability of the continuous production of a product without being harmful to the environment or depletion of natural resources. Sustainable palm oil prevents deforestation and climate change.
The Roundtable on Sustainable Palm Oil (RSPO) indicated that 21% of the supply of palm oil in the world is currently certified and sustainable (Kaye, 2017, para.1). The SCS Global services perceive that the growth of sustainable palm oil has been contributed to by the imposed regulations by the government and the increased consumer demand. Many companies have joined in the campaign against the destruction of the tropical forests and habitats for animals. For instance, the European Union posed a ban for the importation of palm oil for biofuel while other food companies were committed to ending deforestation. These are some of the activities which drove up the demand for the Roundtable on Sustainable Palm Oil. It is important to note that sustainable palm oil is profitable in business and does not harm the environment or the local people. Some companies have embraced the No Deforestation, No Peat, No Exploitation Policy (NDPE). Some of these companies are American agribusiness firm Cargill, Golden Agri-Resources (GAR), Indonesian grower Asian Agri, Singapore-based Musim Mas, and Wilmar International.
Carbon and water footprint
The carbon footprint concerns greenhouse gas emissions. The Intergovernmental Panel for Climate Change (IPCC) has related this to the climate changes that we are experiencing. The water footprint is the volume of freshwater that is used by people or a company in the production of certain products. The water footprint is a multi-dimensional indicator that demonstrates the capacity of the consumption and the polluted water. It has three aspects, which are blue, gray, and green water footprints. The two concepts, water and carbon footprint are significant in addressing climate change and the scarcity issues of freshwater. Sustainability strategies are considered to ensure that these concepts are discussed. The carbon footprint measures the emission of gases, which contribute to the occurrence of global warming while the water footprint measures the consumption and the contamination of freshwater resources.
The conversion of rainforest land into oil palm plantations contributes to carbon emissions. It is the case considering that a hectare of converted land is equal to a loss of 174 tons of carbon. This carbon gets into the air as carbon dioxide. Studies have indicated that tropical deforestation accounts for approximately 10% of total global warming. With the high demand for palm oil, some of the farmers are willing to cut down the trees and planting palms. It is generating a good outcome that influences many people into engaging in this business. Moreover, palm oil is used in the making of many products; thus, companies are working together with the farmers. This way, the companies have a guarantee of where to get the raw materials to extract the palm oil.
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The carbon footprint has become a broadly utilized idea by society, despite its absence of logically acknowledged, and all-around embraced rules. Concerning the water footprint, there is a significant risk that it will face similar issues like the carbon footprint. The shortcoming of balancing and lack of bias systems for the carbon footprint shows that applying those ideas to the water footprint is certifiably not a smart thought. A progressively successful instrument is most likely a direct water footprint decrease focuses on being implemented by the two governments and organizations. Taxation is considered a possible strategy that would be efficient in water footprint reduction. The problem of this solution is that a taxation policy on a single criterion is not standard and would be challenging to implement.
On the other hand, applying the taxation policy in the water footprint will be a bit complex due to the distribution problems. In other words, imposing a taxation policy to influence water footprint reduction is not effective. Implementation of multi-dimensional policies for water and carbon footprint are effective when used all together. These policies should be addressing trade, pollution, land use, agriculture, food security, and poverty. Using a combination of these policies will lead to reduced pollution and negative impacts on the environment.
The water footprint is an indicator of environmental sustainability (Safitri et al., 2019, p.2). The growth of oil palm plantations is a strategy of ensuring sustainability and facilitates the evaluation of water footprint conditions. Some of the methods which are employed in the analysis of water footprint are the Pfister method, Milai Canals approach, and eco-scarcity method. It is important to note that the water footprint comprises of the total sum of all the water utilized in the supply chain. This is blue, green, and gray water. In analyzing water footprint in the oil palm plantations, the main issue that has been affecting the process is the availability of limited climate data. The root density also affects water usage, which is a primary factor of water footprint. The root density of palms differs due to the architecture of the roots. It is affected by the soil types and the age of the crop.
From this discussion about carbon and water footprint, it is evident that the supply chain and the manufacturing of palm oil affect them. The production of carbon compounds from the production process of palm oil influences carbon footprint. The water footprint is the amount of water that the crops take up for growth. This is determined by the type of soil and the structure of the roots of the plants.
Logistics to Improve Quality
Logistics is the overall process of managing how resources are acquired, stored,, and transported to their final destination (Investopedia, 2019). In the past, the cost of logistics and supply chain processes, which include freight transportation, storage, inventory management, and materials handling, was determined exclusively in monetary terms. The lack of consideration for the environmental cost of these processes and the impact of the pollution they cause in the Earth’s atmosphere has become concerning to the vast majority of the population (Statistics Netherlands, 2018). Due to social, political, and economic demands for more sustainable developments, industries are beginning to consider the external costs that their practices generate,, which is mainly climate change, air pollution, noise, vibration, and accidents (Green Logistics, 2010).
However, the majority of the palm oil consumers are not aware of the amount of carbon and water in the foods that they consume. Some researchers decided to investigate the consumers’ understanding of the carbon footprint of food. There is a need for consumers to be encouraged to purchase and consumer sustainable food products. During their survey, they found out that the majority of the customers underestimated the amount of greenhouse gas emission, which is associated with the production process and transportation of products, (Michail, 2019, para.7). There have been changes in climate and global warming. These are events that have caught the attention of the government, consumers, and different organizations. These sectors have decided to implement strategies that lead to a low-carbon economy. One of the tools that have been implemented is carbon footprint labeling. It is a factor that is being used to reduce greenhouse gas emissions. Through the existence of carbon labels on products, the customers are informed, and they comprehend the carbon footprints in the products they ate purchasing. These carbon labels are significant since they demonstrate the amount of carbon dioxide and other greenhouse gases which are emitted during the production, dissemination, utilization, and disposal of a product. Therefore, the customers have the options or alternatives for select products that are safe for their well-being.
It is essential to educate the citizens about the meaning of carbon footprints and the consequences that we will face if we consume foods with high carbon emissions. Some of the people are not informed, and they find no importance in the labels that they see on the product’s packaging. Creating awareness is relevant since many companies will be focused on ensuring that their products are safe, and there is reduced carbon IV oxide being produced. Therefore, the carbon labels in the palm oil products are significant since the consumers are on the watch out. It has influenced the companies to engage in promoting sustainable palm oil. This ensures that the environment is protected and the well-being of the consumers is considered.
The water labels are essential, considering that they indicate the amount of water that was used in the production process of the palm oil product. The customers will know how much water was used in the making of the product. They will then make a right decision on which product they should consume. Many of the companies pay close attention to the water footprint of their products. Majority of the consumers’ purchase products without being informed of the water footprint. The water labels are significant since they work as incentives for consumers, and the government may decide to impose tariffs on the product depending on the water footprint.
Therefore, improved water and carbon labels are contributing to the promotion of sustainable palm oil. These labels are influencing the customers into selecting products which are not harmful to them and the environment. Therefore, companies find that it is their responsibility to ensure that the production processes of the palm oil products are emitting low amounts of carbon dioxide. It is because high emissions of carbon dioxide would lead to the loss of potential customers. Many people will prefer to use products which are safe in their surroundings. The water and carbon labels have played a significant role in influencing companies that produce palm oil products to ensure that the production processes and the supply chain do not contaminate the products.
Lean Management in Palm Oil
The conservation of the environment and ensuring sustainability is one of the best practices in the palm oil industry. As discussed earlier, the production process of palm oil is associated with the emission of carbon dioxide. It is a gas that is well known for causing global warming. Companies and the government have joined together to ensure that there is a minimized amount of carbon emission. The use of carbon labels and government regulations has led to the emergence of positive impacts. It is the case considering that every firm wants to maintain an excellent reputation. Therefore, they will find the best practices to implement to minimize the amount of carbon dioxide that is produced during the making of palm oil products. With the imposing of policies, firms will have to adhere and abide by the rules, or else they will face legal consequences. They are good practices since they have had a positive impact on society.
Waste minimization and recycling is a good practice in the palm oil industries. During the production process of the different palm oil products, there are wastes. Companies have adopted a grand strategy where they are recycling some of the materials and using them for other essential activities. The residues that are not useful should be directed to a specific area that will not pollute the soil or air. A lot of advancements have occurred in the manufacturing industries, where they have integrated the use of technology. We have technological systems that have been implemented in the processing units to minimize the chance of the occurrence of errors. Besides, these machines are more advanced, and therefore, they ensure that the raw materials are maximally used in the production of the final products. Waste management is essential since it leads to having a clean environment which does not affect the health status of human beings (Weng, 2005, p.3).
Another best practice in the palm oil industry is the improved transportation of the products. Some of the products from palm oil are foods. It follows that the food products should be handled with a lot of care and ensure that they are not contaminated. The vehicles used for transportation should be in good condition and clean. Food products need to be delivered or transported in an excellent environment to ensure that they are safe for human consumption. If mishandled, it would have a negative impact on a vast population. This may lead to the company being sued, and its excellent reputation will be ruined. Currently, companies have taken this into account, and there are no complaints about the palm oil products. The packaging of the products should be well checked. The packaging is airtight to ensure that no substance can get into the product.
There is a need for implementation of strategies that are contributing to sustainable palm oil. Some of these strategies have already been discussed. They include government policies and carbon and water labels. The local people have faced a lot of challenges due to climate change since the tropical rainforests are being cut down. Many people prefer the growth of palm trees since palm oil products are in high demand. It, therefore, means that the raw materials are, also, on high demand. Having sustainable palm oil will have a lot of advantages where we will take care of the environment and protect the habitats for wildlife.
Conclusion
In conclusion, sustainable palm oil prevents deforestation and climate change. The demand for palm oil has been rising, and this has influenced people into cutting down trees and planting palm trees. The two concepts, water, and carbon footprint are significant in addressing climate change and the scarcity issues of freshwater. The carbon footprint measures the emission of gases while the water footprint measures the consumption and the contamination of freshwater resources. The best practices in the palm oil industry are conservation of the environment and ensuring sustainability, waste minimization and recycling, and improved transportation of the products.
References
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Safitri, L., Hermantoro, H., Purboseno, S., Kautsar, V., Saptomo, S., & Kurniawan, A. (2019). Water footprint and crop water usage of oil palm (Eleasis guineensis) in Central Kalimantan: Environmental sustainability indicators for different crop age and soil conditions. Water, 11(1), 35. Retrieved from
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Niamh Michali. (2019, January). The study confirms carbon label efficacy. Retrieved from
Weng, C. K. (2005). Best-developed practices and sustainable development of the oil palm industry. Journal of oil palm research, 17(C), 124. Retrieved from
http://palmoilis.mpob.gov.my/publications/joprv17dec-ms124.pdf
Leon Kaye. (2017, June). 21 Percent of Palm Oil Now Responsibly Sourced. Retrieved from
https://www.triplepundit.com/story/2017/21-percent-palm-oil-now-responsibly-sourced/16921
Conservation international. (n.d.). Sustainable palm oil. Retrieved from
https://www.conservation.org/projects/sustainable-palm-oil
Eco-Business. (n.d.). What is sustainable palm oil? Retrieved from
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