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Cargill statement in response to the RAN report

May 07, 2010

Cargill is a leader in growing and developing sustainable oil palm and we are working with well-respected environmental non-governmental organizations (NGOs), including WWF and Fauna & Flora International, to assist us and to support the sustainable development of palm oil in Indonesia. 

We want to set the record straight on the false allegations about Cargill made by Rainforest Action Network (RAN) in its May 2010 report ‘Cargill’s Problems with Palm Oil.’

We do not operate any undisclosed oil palm properties.  RAN claims we have an undisclosed company called PT Harapan Hibrida Kelbar (HHK).  We have no company under our ownership or any subsidiary or joint venture with such a name.

RAN makes a similar accusation about PT Indo Sawit Kekai (ISK).  We have been extremely transparent about our ownership of ISK.  We have included this property in our initial Roundtable on Sustainable Palm Oil (RSPO) assessments by our RSPO approved auditor, BSI, which is fully aware that ISK is required to be included in our property bank for Cargill to be RSPO compliant. BSI includes references to this property in their initial RSPO audits. Thus, we have fulfilled the RSPO requirement of disclosing all of our oil palm plantations and have committed to having all of our oil palm plantations RSPO certified.

RAN claims Cargill has cleared rainforests and primary forests.  This is categorically untrue. It is our policy to not expand or develop new plantations in areas of high conservation value forest (HCVF) and we  have not cleared or developed any land that can be categorized as rainforest or primary forest.  The entire area where our properties are located in Kalimantan were deforested by loggers over ten years ago, which was before we acquired the plantations.  The land was logged and then converted to oil palm plantations.  There is no rainforest or primary forest in, or anywhere in the vicinity, of our plantation.  

RAN claims Cargill illegally cleared ISK of approximately 10,500 hectares of natural forest and that we did not conduct a High Conservation Value (HCV) assessment of the land.  Again, this is false.  It is important to note that the ISK land was not zoned as forest by the government before we were granted the rights to develop the property.  The land has had two HCV assessments.  One was completed by the organization Environmental Monitoring & Management and another has been completed by Fauna & Flora International, an internationally respected environmental NGO, which utilized ProForest’s stringent HCV Toolkit in their assessment.  As a result of the HCV audit by Fauna & Flora International about 50 percent of the ISK land we had government permission to develop has been conserved.  The Fauna & Flora International HCV report was presented to the RSPO and is fully open to the public, which directly refutes the false allegation that we are hiding our ownership of ISK.

RAN falsely claims that we use burning to clear land.  We have a strict no-burn policy for land preparation and so we have never burned land for clearing.  We even record fires on our plantations and report these to local police. RAN cites that there were fires on Cargill concessions, which is true.  However, the fires in 2007 occurred from natural causes when El Nino created very dry conditions in the entire Kalimantan area.  The conditions were so dry that we actually lost thousands of oil palm trees on our plantations from these fires.  Every plantation in the area suffered the same fate as a result of this drought. 

RAN accuses Cargill of developing plantations on peat land.  Again, this is not true.  We have committed that we will not develop new plantations on deep peat land. There is no peat land in the Harapan or ISK developments.  ISK was verified as having no peat land by soil samples during the HCV assessment undertaken by Fauna & Flora International. 

RAN claims that Cargill has developed land against local land owners’ wishes.  This is also not true.  All of the land that we have developed in Kalimantan requires a purchase agreement with the local land owner.  The sales agreement is approved by the local village chief.  We have not developed any land without the explicit permission, signed land sales agreement and payment made to each and every land owner.  We have records of payments made by Cargill to each land owner and pictures of each land owner.  This is evidenced by the fact that there are open plots in and around our plantations, where the local land owners chose not to sell their property to Cargill.

RAN makes the accusation that the ISK plantation has polluted the river water from its mill effluent.  This is impossible because ISK does not have a mill.  At our Harapan plantation, we have two palm fruit processing mills and both are government approved effluent treatment facilities with land application permits.  Every six months we submit an effluent monitoring report to the local Department of the Environment that includes testing results at designated points, as stipulated in our environmental impact assessment (AMDAL).  In addition, after the effluent is treated, much of the water is pumped back onto the plantation to conserve water and act as a natural fertilizer.  It is also important to note that there are no inorganic chemicals in the effluent.  The effluent consists of water and waste resulting from processing palm fruit bunches.

In its report, RAN falsely claims that Cargill does not leave buffer zones along waterways; this is untrue.  Cargill has left the existing natural vegetation and trees areas along rivers and other waterways untouched.

RAN cites the  Indonesian regulations (of 1999) which specify that a single company cannot control more than 20,000 hectares of plantation in a single district. However, they omit to cite the 2007 Regulations of the Minister for  Agriculture which allow  total ownership of up to 100,000 hectares nationally with no restriction on the province.

Lastly, RAN falsely claims Cargill does not have the environmental impact assessment (AMDAL) to develop ISK.  The government has granted the ISK development an environmental management and monitoring document (DPPL) in lieu of an AMDAL for the development of the site.

Cargill believes palm oil should be produced sustainably, we are committed to working towards sustainable palm oil production and we fully support the RSPO process.  Our palm plantation – PT. Hindoli in Sumatra, Indonesia – was one of the first to receive RSPO certification in February 2009 and we are working to certify our other plantation in Indonesia as quickly as possible.  Our Hindoli smallholders are also scheduled to be RSPO certified this year – we expect they will be the first smallholders certified globally.

We also have set a goal of buying 60 percent of our total crude palm oil from RSPO members by the end of 2010 and encourage all of our suppliers to become members of the RSPO and to work to certify their plantations.

For some time, we have also had our own policies in place for responsible palm production on our own plantations. These include commitments that we will not plant on high conservation value forests (HCVF); we will not develop new plantations on deep peat land or land that would threaten biodiversity, including orangutans and other native species. We also have a strict no-burn policy for land preparation.

Additionally, we are working with local communities and international organizations such as WWF, Conservation International and Fauna & Flora International to protect HCVF and species in and around our plantations, and we have contributed to research to encourage the viability of palm oil development on degraded land. More information about our commitments and efforts on sustainable palm oil is available on