Environmental Concerns Grow As Palm Oil Becomes Popular Energy Source

12 Feb 2007

KUALA LUMPUR - The oil palm has been held responsible for a range of ills
including rainforest destruction, the annihilation of orang utans and
haze-polluted skies.

But lately, high crude oil prices and new health concerns have given the
towering palm, grown mostly in Malaysia and Indonesia, a surprising new
status as an environmental saviour.

Palm oil production and prices are soaring as it finds favour as a source
of eco-friendly biofuel - fuel derived from renewable resources as an
alternative to fossil fuels - and as a substitute for the new dietary
baddie, trans fats, which are commonly used in processed food.

Palm oil used to be shunned because it is a saturated fat, but trans fats
are now believed to be much more harmful and last year the United States
market for Malaysian palm oil grew by 65 per cent as consumers began
making the switch. Meanwhile, European nations in particular are fuelling
big demand for biofuel, which is derived from natural oils and plants and
added to ordinary diesel.

Last year Malaysian exports of palm oil, already the world's largest, grew
to a record RM31.8 billion ($14 billion), 5 per cent up on the last high
set in 2004. Indonesia is aiming to overtake Malaysia as the world's
largest producer of palm oil by next year by expanding the area under
plantation.

Environmentalists, however, say that the benefits of palm oil will not
outweigh the damage wreaked by a dramatic expansion of planting at the
expense of rainforests.

Friends of the Earth, in a 2005 report on shrinking orang utan habitats in
Indonesia and Malaysia, called for a boycott of palm oil products. "If
forest destruction continues at the same scale and speed, the orang utan
will be lost within 12 years," it said.

Malaysia has denied the claims, saying that forests are no longer cleared
for plantations.

In Indonesia, plans for a vast new plantation in Kalimantan which would
strip 1.8 million ha of forest - an area half the size of the
Netherlands - have raised particular alarm.

Burning to clear land for palm oil also poses a hazard because the dense
smoke wafts right across the region, raising health concerns and
disrupting air travel and other business activities. It has become an
annual phenomenon. - AFP