Organic palm oil causing a stir

Organic palm oil accounts for 0.2% of sales by volume. It is a niche market that has been in turmoil since 123 smallholder families from the community of Las Pavas in Colombia were turned off their land in January 2009 so that the agribusiness group Daabon could use it for a 1,100 hectare palm oil plantation, with the support of the national land management agency.

Daabon is known in Europe as a leading supplier of organic palm oil. It is also Colombia’s biggest palm oil business, whether organic, or conventional as at Las Pavas. In less than a decade, the country has risen to be the foremost producer on the American continent and has its eyes set on the growing biofuel market. The Daabon group is a family business group run by one of the big families who have held the reins of local government since the colonial era, with close links to central government. Internationally, it wields considerable clout in the RSPO.
A report in the Guardian newspaper about campaigning group demonstrations outside Body Shop stores caused an outcry in England in September 2009. The cosmetics brand, now a subsidiary of L’Oréal, had begun to source palm oil from Daabon two years earlier.
Since then, the practices of the entire industry sector in Europe have been put on the line, not least due to rumours about the group’s questionable business practices. Claudia Guevara, a former Colombian journalist living in France, writes the Avenue Colombie blog, in which she details the ins and outs of the Las Pavas case. She castigates the «ethical problem» of Colombian organic palm oil and the failings of official certification. She is now calling for a boycott on all forms of palm oil.
The organic distribution chain is not currently following suit. Apart from The Body Shop, it has not gone as far as the handful of traditional distributors who now want nothing to do with this controversial product. The distributors have had audits done in Colombia and Daabon has pledged to change some of its practices, but that is as far as it goes. While the row seems to have subsided for now, a cloud of doubt still hangs over a previously untarnished sector.

Excerpts from the brochure "Palm oil in world trade. A strategic and controversial issue" written by Jean-Paul Rivière for the Trade for Development Centre (BTC - Belgian development agency). Free to download