The Fires of 2014: Analysis Finds American and Malaysian Companies Responsible

Once again, Sumatra is burning – and for the first time since the haze crisis of June 2013, choking smog threatens the region. The Indonesian government says 50,000 people are suffering from respiratory problems from the “extremely hazardous” pollution levels as palm oil and pulp and paper companies take advantage of dry weather to clear forests and convert them to plantations.

There is a lot of speculation, but one of the big reasons for the smog crisis isn’t being told: companies like Cargill and Malaysia-based IOI are creating a market for palm oil from deforestation through their no-questions-asked sourcing policies. By buying palm oil from companies with fires burning on their plantations, they’re providing a financial incentive to the palm oil industry to keep up business-as-usual.

Similarly, a groundbreaking new analysis from the World Resources Institute shows fires burning across concessions owned by pulp and paper companies like APRIL that have similarly refused to take simple steps to protect forests.

This no-questions-asked palm oil and pulp and paper is finding its way into the products and packaging of global companies like Dunkin’ Donuts, connecting consumer companies to the problem.

Here’s what we know on the smog crisis:

  • Over the past two weeks, satellite data identified 3,101 “high confidence” fire alerts on Sumatra – over 400 more fires than the devastating smog crisis of 2014.
  • Palm oil is one of the key drivers of deforestation, and fire is one of the most destructive ways to clear land for cultivation. As long as there are companies willing to buy palm oil no-questions-asked, there is a market and therefore an incentive for this destructive burning.
  • According to the Indonesian Ministry of Forestry, almost half of the fires are taking place on concessions managed by palm oil, pulp and paper, and timber companies.
  • Major palm oil traders IOI Cargill and Bunge, and pulp and paper company APRIL, have so far refused to commit to eliminating deforestation from their supply chains. An opaque supply chain gives them plausible deniability to buy palm oil from burned forest land.
  • Following outrage caused by last year’s smog crisis, the world’s largest palm oil trader Wilmer International committed to a breakthrough No Deforestation, No Peatland, No Exploitation policy. Palm oil leader GAR last week followed by extending its Forest Conservation Policy to third party suppliers. Many consumer companies like Kellogg and Mars have followed suit. But as long as companies like IOI, Cargill and APRIL refuse to adopt such a policy, an incentive to burn remains.

Photo credit: CIFOR on Flickr

On May 19, 2014
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