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Palm Oil and Indigenous Peoples in South East Asia

Introduction

Crude palm oil (CPO) is a highly valued product that is traded on the international commodities and futures markets. Processed palm oil is used in a huge variety of products in cosmetics, foods, lubricants and also fuels, and overall consumption more than doubled between 2000 and 2010 with the main new demand coming from Eastern Europe, India and China.

In broad terms, the price of palm oil has increased steadily over the past 20 years, although heightened interest in biofuels led to a spike in its commodity price in early 2008 followed by a crash, after which the price returned to where it was before the boom and then continued its more gradual appreciation.

 

Two countries in South East Asia, Malaysia and Indonesia, produce over 80% of the internationally traded CPO. While significant expansion is occurring in Thailand, Papua New Guinea, Costa Rica, Colombia, Ecuador, Cameroon and the Democratic Republic of Congo, the dominance of Indonesia and Malaysia is likely to endure for quite some time. In Peninsular Malaysia, the palm oil frontier has come near to the limits of land availability and most expansion within Malaysia is now in the two eastern States in Malaysian Borneo, Sabah and Sarawak. However, the most vigorous expansion in now taking place in Indonesia where, even by 2006, provincial land use plans had targeted up to 20 million hectares of lands for oil palm expansion.

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