13/07/2010 (The Star Online) - SERIOUSLY speaking, no oil palm planter wants to be faced with a similar predicament experienced by Indonesian plantation group Sinar Mas over the past six months.

The group had been the centre of a series of serious allegations on deforestation by the Western non-governmental organisations (NGOs) which had resulted in the company facing boycotts from major world retailers like Unilever, Nestle, Home Depot, Woolworths, just to name a few.

The latest blow has even spread to Sinar Mas’ paper and pulp business unit Asia Pulp and Paper Co (APP) following environmental NGO Greenpeace’s allegation of rainforest and peat land destruction last week.

APP was accused of ruining the environment in the Bukit Tigapuluh forest landscape and peat land in Kerumutan, both in Sumatra.

This saw Carrefour SA Indonesia last week announcing its decision to halt purchases from APP – the supplier of Carrefour’s private label products – beginning mid-2010 until a deadline to be determined later.

Greenpeace is also calling on supermarket chains like the world’s largest retailer, Wal-Mart, and Tesco to stop buying APP paper products and has urged food firms Campbell Soup Co, Dunkin’ Donuts and Pizza Hut, as well as cosmetics firm Shiseido, to stop buying oil palm from Sinar Mas.

While Sinar Mas’ palm oil unit, PT Smart Tbk, may have appointed two certified verification bodies to study the allegation on its palm oil operations with the investigation slated to complete this month, some observers opined that the damage control undertaken by Sinar Mas was a bit too late to repair its tarnished image among world major retailers.

For Malaysian oil palm planters out there, one lesson learned from the Sinar Mas incident is that they should never be complacent and must be armed with the latest facts and data to support their sustainability status whenever questioned or required by the parties concerned.

For example, local big plantation boys United Plantations Bhd and IOI Corp Bhd, members of the Roundtable on Sustainable Palm Oil (RSPO) which produce RSPO-certified palm oil, had been quick to rebutt the allegations by environmental NGOs on their plantation operations.

So beware, no oil palm planter will be spared by the environmental NGOs.

In fact, one industry observer believes that Sarawak-based plantation companies, particularly those cultivating oil palm on peat land, may be next on the NGOs’ target list.

Based on Malaysia Palm Oil Board’s data, the total area planted with oil palm in Sarawak is 750,000ha, of which more than 50%, or about 400,000ha, is peat land.

Interestingly, one Sarawak-based planter was questioning why public-listed Sarawak plantation stocks were not attracting similar interest or premium when compared with their peninsula counterparts during overseas roadshows for fund managers.

The answer could perhaps be due to foreign fund managers’ negative perception about planting oil palm on peat land which had been well lobbied by NGOs.