Brazil launches National Program for Sustainable Palm Oil Production

Brazilian President Luiz Inácio Lula da Silva announced a national program to promote the sustainable production of palm oil in Brazil.  A key measure of the plan is a proposed bill forbidding the cultivation of palm oil in any area with native vegetation, including the Amazon region.  If the bill is passed by the National Congress, palm oil cultivation will only be allowed in areas already deforested in the past, especially degraded land areas. In addition, the Program for Sustainable Production of Palm Oil establishes conditional credit lines and technical assistance for producers as well as funds for agricultural research and innovation.

"The Program for the Sustainable Production of Palm Oil launched by Brazil today is unlike any other framework in the world. It is designed to utilize degraded lands and prohibits the expansion of production in forest areas, thus helping to fight deforestation - which converges with the Amazon Ecological-Economic Macrozoning law.  Sustainable growth and environmental protection is a top national priority for Brazil", said minister of the Environment Izabella Teixeira.

Brazil currently imports more than half of the palm oil it consumes each year. Palm oil is used in chemical, food, and cleaning product manufacturing as a raw material in soaps, shampoos, detergents, cooking oils and biofuels. 

Sustainability - The most significant component of the program is the proposed bill outlining new agro-ecological zoning rules for palm oil, coordinated by the Brazilian Agricultural Research Corporation (Embrapa). According to these zoning rules, the cultivation of palm oil will be restricted to land that is already occupied by humans, with an emphasis on degraded or low productivity areas. The bill expressly prohibits the clearance of native vegetation for palm production. As a result, palm farming is forbidden in 96.3 percent of Brazils land mass, with total area suitable for the production of palm oil under these guidelines comprising 31.8 million hectares.   Currently, only 70,000 hectares of Brazil's land is used for palm oil cultivation.

The zoning measures aim to promote the recovery of deforested areas, since the high profitability of palm farming will incentivize producers to reforest part of their lands with native plant species in order to become eligible to plant palm. The Brazilian Forestry Code mandates that rural properties must preserve between 20 to 80 percent of their native vegetation.

In addition, a significant segment of the land identified as high potential areas for palm oil cultivation is located in the country's northern region, a priority area for national efforts to prevent and curb deforestation.  Palm oil production offers the local population a sustainable economic alternative to deforestation with a significant economic incentive: according to the Ministry of Agriculture, palm cultivation generates a job per every 10 hectares, which is triple the average number of jobs generated in the agriculture sector in Brazil.

The bill also proposes new regulations and penalties.  For example, companies using palm oil from regions not included in the zoning could now face the possibility of losing their environmental license. Furthermore, oil producers will now be required to register with the Ministry of Agriculture, making them subject to inspection by government officials. Producers who ignore the law can be fined up to R$ 1 million (US$ 570,000), have their property embargoed, and their machinery and products seized.

To ensure compliance with zoning laws, Brazil uses satellite monitoring for near real-time detection of deforestation in the Amazon, an essential tool in preventing illegal felling. Satellite imagery analyzed by the National Institute for Space Research (INPE) enables the Brazilian Institute for the Environment and Renewable Resources (IBAMA) to enforce laws accurately and quickly to prevent the spread of deforestation.

Research and credit - The program also allocates R$ 60 million (US$ 34 million) for research, development and innovation to expand the national capacity to produce oil palm shoots and seeds. The studies will be coordinated by Embrapa and include partnerships with international centers of excellence.

In addition, small farmers, rural producers and cooperatives will be offered technical assistance towards sustainable palm production adapted to the Amazon biome, and credit lines with financing of up to R$ 400,000 (US$ 228,000) to facilitate palm oil planting, maintenance, labor, and the implementation of seedling nurseries for native species. Projects to recover degraded areas will be granted added incentives, including higher financing ceilings and lower interest rates.