SABAH’S plan to certify its palm oil commodity as environmentally sustainable by 2025 has become an unwelcome news for the state’s oil palm smallholders, who fear this will affect profit margins.

Sabah aims for a full compliance of the palm oil Certified Sustainable Palm Oil (CSPO) by 2025, in accordance to the Roundtable on Sustainable Palm Oil (RSPO) guidelines.

Tainted by allegations of pollution, destruction of wildlife habitat, and poor working conditions, a certification will see to palm oil activities streamlined using sustainable cultivation methods.  

The move, if approved, represents the first time a state entity committed to 100% certified palm oil production.

Sabah produces 30% of Malaysia’s oil palm oil from its 1.46 million ha plantation, with 12.8% cultivated by smallholders.

While modernisation is good, it is a costly struggle for the small man to keep up with the stringent guidelines, ranging from workers welfare, safety, machineries and quality control.

Khairy Abdullah from Keningau sees certification as burdensome as many growers in the state still rely on conventional planting.

A shift from conventional planting to sustainable cultivation ensures improved management practice and quality fruit bunches for better market access.

Khairy said regulators such as the Malaysian Palm Oil Board (MPOB) had been slow on updating smallholders on technologies and guidelines.

“I’m a private smallholder and agencies like the Malaysian Oil Palm Board (MPOB) had been slow in executing and briefing growers on matters like these.   

“In general, there had been barely any engagement by them like campaigns or funding, leaving many of us unaware and without funds to revamp operations,” he told The Malaysian Insight.

Khairy, who runs a 24.28ha planting ground in the rural district, said his registration to the MPOB to open up a new 6ha cultivation ground has been held up by the MPOB since 2014.

Khairy said the lack of awareness could see further reductions on payment by millers during sorting process at their refineries.

“This is on top the thousands of Ringgit forked out to buy new machineries, fertilizers and safety equipment for the workers,” said Khairy, who potentially could earn up to RM450 per ton of yield.

An acre (0.4ha) of harvest is approximately one ton of crops.

Among major concerns in the certification is the poor working conditions, lack of health and safety and low wages of workers in the sector.

To qualify for roundtable certification, growers must show they issue protective equipment to workers, provide adequate accommodation, pay the minimum wage and offer healthcare and other benefits.

Sabah’s palm oil industry provides jobs to over 150,000 foreign workers.

He said smallholders like him stand to further lose out to commercial plantation firms that are already producing 50% more yield than private smallholders.

Another smallholder from Tawau said certification would only make it very difficult to deal their produce and would run many smallholders out of business.

“As small holders or small time growers, we only need an MPOB licence to sell the FFB to the mill or collection center.

“The so called certificates would force us to meet requirements and this would be tough for us,” said Clarence Chin, who runs a 4ha plantation in the East Coast district.  

The State’s jurisdictional CSPO certification is a 10-year programme approved by the state Cabinet in 2015 and spearheaded by the Forestry Department.

The certification is not to be mistaken with the federal’s Malaysian Sustainable Palm Oil (MSPO) certification, which will become mandatory in 2019.

RSPO certification had become an obvious choice for Sabah as it is already a recognised benchmark in Europe.

Chief Conservator cum Forestry Director Sam Mannan believed certification was crucial as Sabah no longer had the capacity to compete with other countries in terms of output and size.

The department alone indirectly owns around 100,000ha of planted oil palm plantations in Sabah.

“Oil palm income has now financed forest conservation and restoration in Sabah and producers on land owned by the department had already given notices to be RSPO certified by the end of 2017,” and therefore it’s just a matter of time for the CSPO.  

“This is part of the government’s decision to have the CSPO and we hope everyone in Sabah will be certified with it and so far we are on track.

“The process is much cheaper as the procedure involve grouping of smallholders to apply for a single certification.

“We have been engaging with smallholders over the last two years,” said Mannan.

A non-governmental organisation tasked to engage smallholders, Forever Sabah, claimed it has been tough to explain the new certification to them.

Its Director Cynthia Ong said the CSPO is a “deeply complex issue” and “there is no easy answer” as it involves land matters and the indigenous Sabahans.

Over the past two years, Forever Sabah said it has already engaged smallholders in Telupid, Tongod, Beluran and Kinabatangan. – July 13, 2017.