Palm oil firms depriving tribes of millions of dollars

Image source, Nopri Ismi

There is a good chance that the item you buy will contain palm oil. You will find an oil palm tree in Indonesia once you follow it back through the supply chain. The companies that sell it to major firms like Johnson & Johnson and Mondel have deprived indigenous communities of millions of dollars of income.

Mat Yadi is about to hit the river with his spear. He doesn't catch anything today.

He says that before there were lots of animals.

The Orang Rimba are one of the last nomadic tribes in Indonesia. They have lived in the jungle on the island of Sumatra for generations, harvesting rubber as well as hunting and gathering fruits.

In the 1990s, a palm oil company came to Tebing Tinggi with promises of wealth and development.

According to the Orang Rimba, they would get more than half of the ancestral land back in exchange for taking control of it. The tribe would sell their fruit to the company.

Over 25 years the oil palms grew tall and the bright-orange fruit flooded into the mill, producing millions of dollars worth of oil for the owner, the Salim Group, which was bought by manufacturers of products like Pop-Tarts.

Image source, Nopri Ismi

Mat Yadi says his tribe was promised smallholdings.

His family lives in a makeshift hut.

Nothing was returned to us. He says that they took everything.

Orang Rimba like Siti Maninah pick up fruitlets that fall to the ground when the oil palms are Harvested.

She will buy a few ounces of rice and some vegetables if she is lucky.

Daniel Johan, an Indonesian MP who oversees the agricultural and forest sector, says that corporations are greedy and this is just one example.

The world's most biodiverse forests have been cleared for palm oil plantations. Plantations stretch for miles on end on the once jungle-covered Indonesian islands of Borneo and Sumatra.

The promise of economic development was the trade-off. In order to gain local support and access to government financing, companies often promised to share their plantation with villagers. In 2007, it became a legal requirement for companies to give a fifth of their new plantation to the community.

The scheme helped lift rural communities out of poverty by giving them a stake in an industry worth more than $50 billion a year. There were allegations that companies had failed to fulfill their legal obligations.

Image source, Nopri Ismi

The scale of the problem remained unknown, so over the past two years we have worked together to find out.

The investigation found that companies have failed to provide more than 100,000 hectares of legally- required plasma in Borneo.

We used conservative figures for the profits available from palm oil to estimate how much communities have been deprived of. The province is home to just a fifth of Indonesia's oil palm plantations.

According to an analysis of Ministry of Agriculture data, the losses suffered by communities in other major palm oil producing provinces could be hundreds of millions of dollars each year.

Image source, Nopri Ismi

The scale of the problem can be seen in the official data.

Our team created a database of companies that have been accused of failing to share their plantations with the community.

The last six years have seen protests driven by grievances over plasma, on average. In suppressing protests, the state can be swift and decisive.

In 2015, the Salim Group signed a new written commitment to provide blood products to the Orang Rimba.

It had not happened by January. The tribe had been waiting for two decades.

Image source, Nopri Ismi

The company tore down the huts that the tribe occupied. Villagers set fire to a security post inside the plantation and smashed the windows of the office.

Villagers told us that more than 40 people were arrested and beaten by the police. Seven people were sentenced to prison for vandalizing.

Indonesia police did not respond to our request.

The system is failing because of all the resistance they have mounted, sometimes sacrificing their lives, and still there is no resolution.

Five years after the protest, the Orang Rimba tribe are still waiting for the return of their ancestral land.

The company that controls the plantation refused to be interviewed.

Image source, Nopri Ismi

When communities complain of a failure to meet promises, the government relies largely on mediation, but an academic study found that only a small percentage of negotiations lead to an agreement that is implemented.

Samsul Kamar, the head of a plantation office in Riau, Indonesia's biggest palm oil- producing province, says he fields a new complaint almost every week, with only a few of the 77 companies under his watch providing enough.

He has never gone further than issuing a warning.

Most large consumer goods firms promise to root out exploitation of people from their supply chains.

13 major firms, including Colgate-Palmolive and Reckitt, have sources of palm oil from producers that have been accused of withholding profits from communities over the past six years.

Image source, Nanang Sujana

The plantation on the Orang Rimba land is owned by the Salim Group.

Firms said they required their suppliers to comply with the law. Many companies have supply chain connections to companies that have been outed for failing to comply with regulations.

All of the brands have palm oil from a plantation in Borneo that was temporarily shut down in February for failing to meet its legal obligations for more than a decade.

In a rare example of government action, a politician stationed police to stop trucks from leaving the plantation.

Maybe if there is no firm action that could hurt them, they think they can ignore it.

Johnson said they take these allegations very seriously and had begun their grievance process. The company said it would investigate the allegations and coordinate with its suppliers to figure out the next steps. Mondel said it had contacted experts to better understand the issue and how it could be addressed in the future.

The findings suggest potential systemic problems and require further investigation and coordinated action by various public and private stakeholders.

Colgate-Palmolive stated that it would develop a process to check its suppliers.

Image source, Nopri Ismi

Golden Agri-Resources is the biggest palm oil producer in Indonesia and has plantations across half a million hectares of land.

The company has not fulfilled its legal obligations. The firm said it was committed to doing so, but this remains a work in progress.

They said they are hoping to start planting plasma next year in their subsidiary in Borneo, which was shut down by a local politician.

Golden Agri-Resources and other companies that we wrote to said it was still a challenge to get enough land for a plasma scheme.

The politician from Borneo said he wanted the company to own its own land.

He said that he didn't want to hear any more excuses. There is a main plantation but not a plasma plantation.

Image source, Nopri Ismi

Global shipments of palm oil from Indonesia will resume on Monday after the government lifted a global export ban on the oil.

It banned exports late last month in order to control rising domestic prices.

The companies behind the country's palm oil boom have seen their profits soar this year as global prices reached record highs.

There are already palm oil billionaires on Indonesia's super rich list. The Widjaja family, who control Golden Agri-Resources, are second in the Forbes rich list for Indonesia, while Anthoni Salim, the CEO of the Salim Group, is third.

The Orang Rimba wait for their cut of the fortune goes on.

Cilin sings a folk song under the palm trees. She explains that the lyrics mean that our heart is full if our children are healthy.

We want our ancestors land to be returned to us so that our grandsons can live again.