Agrispective | Episode 11 | Palm oil in focus: balancing food security, sustainability, and farmer prosperity in India

Hi all, India is one of the largest consumers and importers of cooking oil. In particular, it imports nearly 10 million tons of palm oil. It is a huge amount of oil, which is a huge amount of oil. The other hand, global organizations such as Holland based Solidarity Dad, working with small holder inclusive supply chains. What should be the focus with regard to palm oil? How important are traceability and sustainability and how will farmers' income increase? To respond to all these, we have with us Mr. Sumit Roy, Assistant General Manager, Palm Oil Programme at Solidarity Dad, Asia. Welcome to Business Lines, AgreeSpective Podcast Mr. Roy. Sumit Roy. Why should the focus shift from eliminating palm oil to improving how it is produced and sourced? First of all, good morning Mr. Subramani. And thanks for inviting me to this podcast of palm oil, which is a very important topic for discussion and it's controversial too. Now your question has two parts. One is not eliminating palm oil and then improving how it is produced and sourced. Why not shifting from a shift from eliminating palm oil? I've got three reasons. One is distributive palm oil. In our daily usage, it is included everywhere. Over 50% of the supermarket products contain palm oil and 70% of the global palm oil supply actually goes to the food production. Now look at the cosmetics, 70% of the cosmetics contain palm derivative ingredients. So it is highly distributive in nature and the other reason is also structured. Oil presents unique properties because of its natural composition. It remains semi solid at room temperature as well as very stable at high heat. And so it is easily mixable with any other oil or any other food products. So it cannot be completely replaced structurally. And the third reason is environmental. Reflecting palm oil is not a good great idea on the sustainability front. Oil is produced from one hectare of land. And if you look at other, like soil or oil, it is produced from 0.5 to 0.6 tons of oil per hectare. Which means to replace palm oil, it requires almost 5 to 6 times of the land that is required to grow the sedable oil. So and where the land will come from, from deforestation or land use changes, which means biodiversity losses as well as greenhouse gas emissions. Now does it mean that you know the palm oil which is grown is grown sustainability. We need to look at deeper details on it. The palm oil that is being imported is mainly come from the tropical countries which is Indonesia or Malaysia. And it is also designed with deforestation. So the priority should be responsible production, enforcing no deforestation, no peat, no exploitation, no laborite violation and inclusion of small role. And also improving the yield rather than going for expansion. Can you tell us a little about India's growing role in shaping responsible global supply change? See India is the largest importer of palm oil and share almost around 21% of the global import and you look at the size import size it is almost 8 to 10 million metric ton. Double what the combined European Union imports. So the size of the animal report, animal import gives it India a firepower or similar to how Europe uses its regulation for its imported products. And traditionally, if you look at the sustainability discussions that are happening on palm oil were driven by the consumer markets in Europe, not America. But this dynamic is need to change. Asian market demands high amount of palm oil. It's a global consumption is huge. A country's particularly countries in India, it's becoming increasingly important to determine the future sustainability outcomes. India slowly has started importing sustainable palm oil. The fraction is small but it has started the process. So secondly India is also planning to expand its palm oil production domestically through this national emission on edible oil and oil pump program. And embedding the sustainability practices in the oil pump production. India has its own home grown sustainability framework which is called Indian palm oil sustainability framework which can be embraced to ensure that new domestic plantations follow the sustainability norms from the very beginning. So ideally what will happen is there will be domestic production and also a large chunk of sustainable domestic supply that can set a benchmark. And India that can import standards can actually introduce minimum import standards. Favourings say, you know, I post a line of Indonesia sustainable palm oil or election sustainable palm oil or any other certified voluntary standards. So this will eventually strengthen India's negotiation, negotiating position when importing with its buying power India can serve as a critical breach between the market demand sustainability expectations and inclusive development. Can you explain to us the importance of pressability and sustainable processing for businesses? Yeah, see adopting sustainability and pressability is very essential for business to maintain the competitiveness as well as in regulatory standards. But more than the business it is the consumer which can play very significant role in the shift. And India if you look at currently has the what largest millennial population which is also shaping the theme of conscious consumerism and their intelligent and demand sustainable produce food, where and how the food is actually produced. So this awareness of consumption is reflected in the rapidly growing trade of sustainable standards. If you look at the food market and different equal levels which is growing and it is expected to grow at a CAGR of around 20.5% in the coming five years. The consumers are demanding where the food is coming from and how it is produced. So this gives an unique opportunity to reduce the consumption, the conceptive impact on food choices and that can influence the business to act on this demand. Business will be also benefited from the very farifiable supply chain which will reduce with the rotational risk on better consumer trust and disclosing the sustainable sources therefore very important for business and that can be done for various disability tools like mass balance or physical segregation depending on the need of the business and the consumer. How climate resilient farming practices can improve farmer incomes and long term supply chain stability? See oil pump like many other crops is very highly sensitive to climate change. The rising temperature shifting rainfall extreme events it creates space in terms of impaired photosynthesis, voluntary stability, fruit development or deoxygenated food systems and in face-based antigen disease and pestation. So this can actually change the production, can reduce the fruit fresh food banchels by almost 41% as reported. So therefore climate resilient practices is in oil pump cultivation is very important. It can actually lead to a stable high return enterprise for the small amount of farmers while creating a reliable and shopped resistance supply chain. Use of yielding varieties, climate adaptive varieties, better spacing, spacing, intercropping during our years, precision nutrient management, cover cropping, mulching, composting, reduce damage to build soil organic matter which will improve water retention, efficient irrigation systems, rainwater harvesting can actually improve builds and mitigate risk from the production values. And there are right now is early warning systems that has come into play. This will also help decision making for the small amount of farmers. So all these climate resilient practices will support resilient production systems. This will also ensure stable feed stock for the value chain in ensuring sustainable supply chain. And a bit about the intersection of sustainability, food security and inclusive growth. And this is very important questions and it's also important to understand this how actually the palm oil fits into the gamut of food security sustainability and inclusive growth. So my question, my internal question to me is like that is conflicting or converging. So let's see. If you look, if you see India in the 90s, India was able to make this edible oil demand from the domestic production. The per capita oil consumption was around 4 kg per annum, which has now increased to 20 kg per annum. So the total edible oil requirement is right now is 25 billion metric ton and palm oil fits around 10 to 12 million tons to this overall. vegetable oil basket. Now if you look at the future demand, various models, various studies suggest that the vegetable oil demand in India will be more than 55 million metric tons per annum. Solidarity has conducted study to understand the palm oil requirement, the coming future, which is that by 2047, India may require 22 million metric tons of palm oil. You know, we cannot completely abate the palm oil requirement. This requirements will be made from both domestic as well as import supply. So for the food and the food security is important to have a balance between the import and the domestic production. Definitely, the plan is to enhance the domestic pie as much as possible. Now coming to the question of sustainability, it actually goes hand in hand with the food security and focus should be on enhancing productivity and if required, the expansion should target fellow land, culture, rebel, west land and perversion of low-ridden crops to palm oil and avoidance of forest, grassland and other ecosystems in zone. As I mentioned earlier, the embrace iPOS as a sustainability framework implement climate smart practices, efficient water management practices and decent buck conditions. So when food security and sustainability is met, I think it results in inclusive growth. Mamoil offers a small and marginal farmers a significant higher stable income than any of the crop right now. I mean, it can give an advantage of around 50 to 1 lakh rupees per hectare if we compare with rice and cotton. So it also creates ample opportunities like job opportunities across its value chain, whether it is milk, whether it is processing, whether it is necessities, whether it is logistics. So at the end, I mean, I think the sustainability for security and inclusive growth goes hand in hand. Thank you very much for your insightful views. It's been a pleasure to have you on this show Mr. Roy. Thank you listeners for tuning in until we meet in the next episode. This is Subramany Mankombu signing off. Bye.