The African oil palm (Elaeis guineensis) originated in West Africa and grows extensively in this region, but largely as low-yield multi-crop stands in and around villages, where it has been traditionally grown as a subsistence crop in small-scale farming systems for thousands of years. Africa (and West Africa in particular) is a new frontier region for large-scale palm oil production. Many companies that already have existing plantations and other investors are now looking to expand their operations into this region to meet the growing demand for palm oil. Depending on the country, smallholders account for between 70–90% of African oil palm growers.
Yield is much lower in Africa than in Southeast Asia for various reasons, including climate and infrastructural limitations and a predominantly smallholder approach to production. It is debatable whether comparative yields are achievable even with investment and improved growing techniques.
While Africa remains a net importer of palm oil, African governments see oil palm development as a potential source of tax and export revenue. A growing number of investors, including some of the world’s largest plantation companies, are finding concession areas easier to secure in Africa than in other parts of the world such as Asia. Developments for sustainable palm oil are at the very early stage and are likely to be determined by the pace of agro-industrial project developments. The Africa Palm Oil Initiative (APOI), the first Signature Initiative of the TFA 2020, recognises the ambitious development plans of countries in Africa and aims to help transition the palm oil sector to a sustainable driver of long-term, low-carbon development in the region, through the development and implementation of a set of regional principles for responsible palm oil development.
Democratic Republic of Congo
- About 60% of the dense humid forests (approximately 47 million hectares) of the Democratic Republic of Congo (DRC) are ecologically suitable for oil palm cultivation. Currently there is great interest in establishing large oil palm plantations in the region to meet local and international demand.
- In the DRC, three companies—Feronia (Plantations et Huileries du Congo), Groupe Blattner Elwyn, and Socfin SA—are managing the major plantations in the country, covering approximately 150,000 ha.
- Smallholders dominate agriculture production in the DRC and represent 85% of palm oil production.
- Smallholders harvest fresh fruit bunches (FFBs) from abandoned plantations and process them into palm oil using artisanal, low-tech milling procedures, in more of a gathering- than production-based activity.
- In 1960 when the DRC gained its independence the country was exporting 160,000 tonnes of palm oil each year, second only to Malaysia in terms of level of production. National production is currently estimated at around 300,000 tonnes per year, of which 50,000 is from industrial plantations, another 50,000 from village plantations, and the remaining 200,000 tonnes from “la palmeraie naturelle” or “natural palm” growing in non-plantation indigenous forest.
- The country imports roughly 50,000 tonnes of palm oil each year in order to meet its total domestic demand of 350,000 tonnes per year which is projected to grow at a rate of approximately 5% per year. At this rate domestic demand will exceed a million tonnes by 2030. Meeting this demand locally would require around 160,000 hectares of additional plantations.
- The DRC does not currently have any RSPO members.
- Gabon has less than 35,000 ha of industrial oil palm plantations owned by Olam International Limited (a global integrated supply chain manager, processor and trader of soft commodities) and SIAT Group (an agro-industrial group of companies who specialise in the establishment and management of industrial as well as smallholders’ plantations and allied processing and downstream industries).
- Olam plans for a further 100,000 ha of oil palm in the future, consisting mostly of large scale plantations along road corridors (smallholdings with oil palm are practically non-existent).
- Olam is an institutional supporter of RSPO and has its own sustainability policy which includes not planting in primary forest, disclosure on the RSPO website with regards to new planting and the use of participatory mapping with local people to highlight potential loss of use and access rights. A key issue is identifying the right sites for sustainable production.
- Approximately 5,000 people are employed on Olam plantations in Gabon (palm and rubber).
- Gabon has one RSPO member, SOTRADER (Societe Gabonaise De Transformation Agricol), a public-private partnership between the Government of Republic of Gabon and Olam International, which aims to develop smallholders’ agricultural program i.e. GRAINE (Gabon des Réalisations Agricoles et des Initiatives des Nationaux Engages) and promote sustainable development that benefits local populations.
- The French Bolloré group is one of the main players in the oil palm sector in Cameroon, producing 80% of the national production of palm oil and holding 40,000 hectares of plantations through its companies SOCAPALM, SAFACAM and Ferme Suisse. The company also has industrial plants and has recently declared its interest in the production of biodiesel. In the year 2000 SOCAPALM was given another 43,000 hectares in concessions for establishing oil palm plantations.
- In August 2012, the US-based company Herakles Farms withdrew its application for RSPO certification of a 70,000 hectare plantation in Cameroon following complaints filed with the RSPO against it by a number of non-governmental organisations (NGOs). The company and its subsidiary Sithe Global Sustainable Oils Cameroon have been accused of violating both Cameroonian law and the RSPO Principles and Criteria.
- Cameroon does not have any RSPO members.
- Archaeological evidence suggests that palm oil was traded by ancient Egyptians at least 5,000 years ago, through the discovery of an earthenware jar containing residues of palm oil, in a tomb at Abydos in Egypt.
- Palm oil is considered Egypt’s most imported edible oil, with a total of 881,000 tonnes imported in 2014. Of this, 39.7% came from Malaysia, around 350,000 tonnes. Refined, bleached and deodorized (RBD) palm oil, RBD palm olein and RBD palm stearin were the major types of palm oil imported, with the trade valued at $US 150 million.
- Egypt has four RPSO members, all consumer goods manufacturers. AFIA International Egypt, part of Savola Group and an independently operated organiztion, is the market leader in edible oils in the consumer goods sector in Egypt.
- The Misr Gulf Oil Company processes several forms of palm oil products, such as vegetable ghee, palm oil, palm olein, palm stearin, shortening, palm kernel oil, and fatty acids. Some of these are used in domestic cooking and frying, or in shortening for the production of biscuits and other kinds of foods. The oil and its products processed by Misr Gulf Oil are consumed in other countries of the region, such as Libya, Syria, Jordan, Kuwait, Saudi Arabia, and Sudan.
- Algeria traditionally produces olive oil (around 70,000 metric tonnes per year).
- Algeria is deficient in oil meals and oils and fats, with self-sufficiency of around 3%. Traditionally, Algeria used olive oil, but, because of the declining production of olives and the increasing demand for liquid cooking oils, other vegetable oils have largely replaced olive oil for local use.
- Algeria imports 120,000 metric tonnes of palm oil per year, entirely for domestic consumption.
- Algeria does not have any RSPO members.
- Kenya’s domestic production of edible oils covers about a third of its annual demand, estimated at around 380,000 metric tonnes. The rest is imported at a cost of around US$140 million a year, making edible oil the country’s second most important import after petroleum.
- In 1993 a new hybrid variety of cold-tolerant, high-yielding oil palm was introduced by the Food and Agriculture Organization of the United Nations in western Kenya. As well as alleviating the country’s deficit of edible oils while providing an important cash crop, it is claimed to have environmental benefits in the region, because it does not compete against food crops or native vegetation and it provides stabilisation for the soil.
- Kenya has two RSPO members, including palm oil processing company Giloil Company Limited.
- In the past decade, the Tanzanian Government has shown increasing interest in biofuels, especially oil palm, to help the country become self sufficient in terms of its energy usage. The government set up a task force in 2006 to facilitate the growth of Tanzania into a biofuel- and palm oil-producing country.
- The National Development Corporation, or NDC, formed in the 1960s to “catalyze economic development”, is spearheading the Integrated Oil Palm Project in the Ruvu River Basin near Tanzania’s commercial capital. So far, the project has secured 6,000 hectares of the total project area. However, data from Global Forest Watch shows the region holds critical wildlife habitat and much of its coastal area qualifies as a biodiversity hotspot.
- Oil palm production in Tanzania is carried out primarily by smallholder farmers.
- In 2005, Belgian company FELISA Ltd planted its first hybrid palm seedlings in the region. The company a project involving 10,000 hectares of plantations. It owns 5,000 hectares and the rest is to be established by local small farmers.
- African Green Oil Limited has a 20,000-hectare plantation project for the production of palm oil.
- Tanzania does not have any RSPO members.
- South Africa has 16 RSPO members. Consumer goods manufacturer members include D H Brothers Industries (Pty) Ltd and Rhodes Food Group of South Africa, and the sole retailer member is Woolworths (Proprietary) Ltd.
- D H Brothers Industries (Pty) Ltd produces margarine and industrial and baking fats. The company supplies deodorised palm olein to McDonalds and various fast-food restaurants as well as other industrial users of palm olein and other palm products.
- South Africa imports around 450,000 metric tonnes of palm oil per year.
- In Angola, palm trees are the typical vegetation found in the north and the Benguela Plateau, and is the southernmost African country where the oil palm grows naturally.
- In May 2010 Indonesia and Malaysia signed an agreement to study oil palm seeds in Angola for their seed improvement programmes. The seedlings collected will be planted at a seed research centre in Sijunjung, Western Sumatra. The seed research is financed by the Oil Palm Research Centre and by the companies Sucofindo, London Sumatra, Bina Sawit Makmur, Tunggal Yunus Estate, Dami Mas Sejahtera, Tania Selatan, and Bakti Tani Nusantara.
- Palm oil and palm wine form part of the culture of many people in Angola.
- The Atlântica Group (Portugal), through its subsidiary AfriAgro has secured access to some 5,000 hectares of land (with the possibility of accessing a total of 20,000) for biodiesel production.
- Italian company ENI (in alliance with Brazil’s Petrobras) has reached an agreement with the government, for the latter to promote oil palm plantations to supply ENI with raw material for the production of biodiesel. A joint venture was signed between ENI and the state company Sonangol in 2011 to develop a pilot project including an area of 12,000 hectares of oil palm
- Angola produces 58,000 metric tonnes per year, and imports around 300,000 metric tonnes a year to meet demand.
- The country does not have any RSPO members.
- In early 2011, Ghana was the first country in Africa to have its National Interpretation (NI) of the Roundtable on Sustainable Palm Oil (RSPO) Principles and Criteria for sustainable palm oil approved.
- Ghana has around 336,000 hectares planted with oil palm, of which estates account for 12% and smallholder farmers account for 88%; it is a net importer to meet its demands for palm oil.
- Ghana has 20,826 ha of RSPO certified area and produces 25,760 tonnes of CSPO.
- Ghana has 13 RSPO members, 11 of which are oil palm growers.
- After years of civil war, poverty, and food insecurity, Liberia is now looking to palm oil as a development opportunity and is focusing on a smallholder approach using modern techniques and technology.
- The oil palm sector has a high potential for growth due to the favorable agro-climatic conditions of Liberia compared to sub regional sectors with poorer soils and significant moisture deficits.
- Virtually all production is from small-scale community-based farms widely dispersed through the country, with very low yields on largely unmaintained and aging trees. Smallholders dominate agriculture production and represent 50% of palm oil production.
- An estimated 40,000 families are directly employed or have some kind of income impacts from the palm oil industry.
- There is an opportunity to increase local palm oil production in the county due to a high consumer preference for palm oil.
- Recent investments by Sime Darby and Golden Veroleum (whose majority investor is Golden AgriResources (GAR), part of the Sinar Mas Group) are examples of the scale of development underway in the region. Together, concession areas for these two companies alone total more than 500,000 hectares and represent approximately US$3.8 billion in investment. Their interest in the region could spur much-needed economic development, but it could also convert critically important forest areas to agriculture use, considering that these concessions border several national parks and critical wilderness areas.
- In 2011, GAR was the first palm oil producer to announce a commitment to a “no deforestation” production footprint through its Forest Conservation Policy, which also established HCS pilots in three plantations.
- Sime Darby has established commitments to the integration of smallholders into sustainable supply chains through the company’s convening and leadership of the Smallholder Acceleration and REDD+ Programme (SHARP) initiative, which brings together smallholders, private sector companies, governments, and civil society to support sustainable smallholder development
- Liberia’s total output in 2008 was around 183,000 tonnes of FFB, which equates to about 40,000 tonnes of crude palm oil (worth approximately US$30 million at current world prices). In 2009, production increased to 47,300 tonnes. However, this level of production is still not adequate to meet Liberia’s domestic demand for palm oil. With annual consumption of approximately 62,800-66,200 tonnes, it must import between 14,000 and 17,000 tonnes of palm oil each year – a figure equal to 20% of its total demand and representing a value of approximately US$10.5-12.8 million.
- Liberia has one RSPO member; palm oil grower Golden Veroleum (Liberia) Inc. (GVL).
- In the 1960’s, Nigeria was the world leading producer and exporter of palm oil, although it has now been overtaken by Indonesia and Malaysia, and is now the fifth largest palm oil producing country in the world. Nigeria is the largest palm oil producing country in Africa, producing around 970,000 metric tonnes per year, estimated at 55% of the African output.
- The national demand for palm oil has grown faster than the domestic supply. Consequently, Nigeria also imports palm oil (around 150,000 tonnes) to satisfy the local demand.
- Palm oil production provides direct employment and income to about 4 million people, mostly in the southern part of the country.
- Palm oil is the third food commodity imported in terms of quantity, after sugar and wheat, accounting for 9% of the total agricultural imports volume in 2010.
- The amount of palm oil exported is very low due to the lack of production surplus and quality which makes Nigerian palm oil less competitive in the global market.
- Nigeria does not have any RSPO members.
SPOTT companies in this region
- Kuala Lumpur Kepong Bhd
- Olam International Ltd
- Sime Darby Plantation Sdn Bhd
- Socfin Group S. A.
Resources and references
- Anjong Young Farmers Group (AYFG) – Reforming of extension services to improve palm oil milling and waste management
- Analysis of Incentives and Disincentives for Palm Oil in Nigeria
- Incentivising No Deforestation Palm Oil Production in Liberia and the Democratic Republic of Congo
- Millions of dollars pumped into oil palm development in Tanzania
- Oil Palm in Africa: Past, Prsent and Future Scenarios
- Readiness for REDD: A Preliminary Global Assessment of tropical Forested Land Suitability for Agriculture
- The future of palm oil in West and Central Africa
- The Outlook for Large Scale Oil Palm Expansion in Liberia
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