PEAT FOR DOLLAR, OR DOLLAR FOR PEAT?

By Andi Abdussalam

Jakarta, March 7 (ANTARA) - Katte Tolli, a 45-year-old farmer who owns a 5-hectare oil palm plantation in Jambi, Sumatra, was depressed when the crude palm oil (CPO) price plunged last year, while Kholil, 35, who also had a 5-hectare oil palm plantation, could still smile confidently.

        "It's only temporary. The price will go up again, sooner or later," Kholil said trying to console his friend as the price of one bunch of fresh oil palm fruit (TBS) nosedived to about Rp300 - Rp400 per kg from over Rp1,000 previously.

        Katte Tolli and Kholil are only two of oil palm farmers in Tankit Baru village which sits on a 1,200-hectare peat land enclave. Farmers in the village chose to plant oil palm because not many crops can grow on peat land.

        However, planting crops on peat land is much easier than on other types of soil because the planting activity can be carried out soon after bushes have been burnt. Basically, pineapple is the most crop cultivated in the village, but since the prospect of CPO seems to be promising, some farmers begin turning to palm oil plantations.

        Those whose plantations have been yielding sell their fruit to collectors who then resell them to big companies for exports. Thus, the dollars go to the investors. It is therefore not surprising if investors also compete to develop oil palm plantation 'to eye dollars from behind palm oil leaves.'

        Amid criticism over the fast depletion of its forest areas and wetlands, Indonesia continues to develop plantations conducted by private companies and state-firms. Due to its aggressive oil palm plantation opening, Indonesia takes over Malaysia's rule as the world's biggest CPO producer.

        Its crude palm oil production in 2009 is estimated to total 20 million tons, of which 4.5 million to 5 million tons will be consumed at home and the rest exported. If the price in March last year of US$1,200 per ton is taken into account, the country is expected to put US$18 billion into its pocket in earning from CPO exports.

        This commercial aspect should not, however, lead the country to exploit its land, especially peat lands. Opening up of peat land or peat forest would dispose water content in it.

        Once the water content is disposed from peat land for the interest of oil palm plantations, the land will become try and make it easier to catch fire.

        "We should not repeat our past mistakes in opening up one million hectares of peat land for an economic growth reason, or any other reasons because doing so means eliminating water from its sources," Dr Bambang Setiadi, chairman of the Indonesian Peat-land Association, on the sidelines of a workshop on Wild Fire and Carbon Management in Peat Forest in Indonesia, on Thursday.

        Peat forests hold bigger carbon sinks than other forests. Indonesia has some 27 million peat lands in Kalimantan, eastern coast of Sumatra and Papua, with a combined carbon sinks of between 10,000 and 34,400 giga tons . Thus, Indonesia badly needs to protect its peat land as otherwise it would release multiple amount of carbon as compared with other forests, which could worsen the green house effect.

        Moreover, destructive exploitations of peat lands for economic benefit could be exchanged with other schemes, where advanced countries are required to pay less developed nations for helping preserve carbon sinks in their forests.

        "The spirit imbued in the Kyoto Protocol enables the adoption of a scheme where carbon projects could be exchanged with a payment of an amount in US dollar or in Euro currency for each ton of preserved carbon by developing countries," Dr Bambang Setiadi, who is also chairman of the National Standardization Agency (BSN), said.

        The schemes could take the form of the Clean Management Mechanism or of the Reducing Emissions from Deforestation and Degradation (REDD) in developing countries.

        Virtually, Indonesia, when it hosted the Conference of Parties (COP) to the United Nations Framework Convention on Climate Change (UNFCCC) in Bali in December 2007, has drafted the REDD mechanism.

        Host of 120.3 million hectares of forests, Indonesia set aside 37.5 million hectares of its forests for the REDD project. "If one hectare is paid US$10 a year, Indonesia will gain US$3.75 billion every year," Environment Minister Rachmat Witoelar said at that time.

        However, Elfian Effendi, executive director of Greenomics Indonesia, a natural resources advocacy non-governmental organization, said the REDD scheme with which Indonesia is expected to get US$3.75 billion incentive a year, belittled the economic value of Indonesian forests.

        Indonesian forests held 7,000 megatons of carbon sinks with an economic value of about US$134.5 billion.

        Advanced countries must pay 134.5 billion dollars if they want to prevent Indonesia from releasing 7,000 megatons of carbon into the atmosphere through deforestation and peat land cultivation.

        So, if this scheme works, the government should design how farmers like Tolli and Kholil would also enjoy the benefit so that they should not shed too much sweat to toil peat lands for dollars.

        But Kholil only shrugged when told about the scheme. "We can sacrifice our land for money but will they sacrifice their money for peat," Kholil said. ***3*** (T.A014/A/HAJM/13:05/A/O001) (T.A014/A/A014/A/O001) 07-03-2009 13:38:16