PALM OIL AND THE ENVIRONMENT IN INDONESIA: DEFORESTATION, FIRES, WILDLIFE

PALM OIL AND THE ENVIRONMENT OF INDONESIA

trucks in Indonesia filled with palm oil Reuters

Indonesia is the world's largest producer of palm oil and has developed a large industry centered mainly on the islands of Sumatra and Borneo, with expansion increasingly moving eastward into Papua. Palm oil is extracted from the fruit and seeds of oil palms and is used in food products, cosmetics, detergents and cooking oil. It has also become an important feedstock for biodiesel, increasing demand for Indonesian production. Palm oil is one of Indonesia's major export commodities. [Sources: Reuters, September 16, 2021; Environmental Investigation Agency, December 12, 2013; Ellen Nakashima, Washington Post, November 2, 2005; Greenpeace, November 7, 2007; Nick Meo, The Times, February 3, 2006; Environmental Investigation Agency, December 12, 2013]

The environmental impact of palm oil in Indonesia is closely connected to the conversion of forests and peatlands into plantations. Tropical forests contain large amounts of carbon in their trees and soils, while Indonesian peatlands contain particularly large carbon stores. When forests are cleared and peatlands are drained, cut and burned, much of this stored carbon can be released as greenhouse gases. This makes land conversion an important part of the climate impact of palm-oil production.

Forest clearing for plantations has also reduced habitat for wildlife. Large areas of diverse rainforest are replaced by uniform stands of oil palms, which provide much less habitat for many native species. Orangutans are among the animals most closely associated with this loss because their populations depend on forest habitat. Other wildlife and plant species are also affected as continuous forests are fragmented into smaller areas.

Fire is frequently used to clear vegetation, particularly in areas of peatland. Smoke from large fires can spread across wide areas, producing severe haze and dangerous air pollution in Indonesia and neighboring countries. The 2015 fires, which had both natural and human causes, were associated with substantial premature mortality from air pollution. Burning peat also releases carbon that accumulated over thousands of years.

The scale of these changes has made palm oil a major environmental issue in Indonesia. Greenpeace estimated that degradation and burning of Indonesian peatlands released about 1.8 billion metric tons of greenhouse gases annually at the time of its 2007 report, although estimates vary depending on methods and years studied. Palm-oil expansion is also linked to soil degradation, altered water systems, erosion and biodiversity loss. The environmental debate has therefore focused not only on the crop itself but on where and how plantations are established.

Environmental Impact of Palm Oil on Borneo

palm oil mill in the middle of palm oil plantations

As recently as the 1970s, three-quarters of Borneo was covered in lush rain forests but Borneo’s role in meeting the demand for palm oil has taken a huge toll.. Hillary Rosner wrote in National Geographic:“ Since 1973, nearly 16,000 square miles of rain forest on Borneo, the island shared by Malaysia and Indonesia, have been logged, burned, and bulldozed to make way for oil palm. It accounts for a fifth of the total deforestation on Borneo since 1973 — and for 47 percent since 2000. [Source: Hillary Rosner, National Geographic, December 2018]

“Industrial oil palm plantations have caused 47 percent of the deforestation on the island since 2000. Some 877,000 acres are currently lost each year. Over 32,000 square miles, an area about the size of South Carolina, have been planted with oil palms.

All that deforestation has been devastating for wildlife. Nearly 150,000 critically endangered Bornean orangutans perished from 1999 to 2015, and although the main culprits were logging and hunting, palm oil was a major factor. It also exacerbates climate change — nearly half of Indonesia’s greenhouse gas emissions come from deforestation and other land-use changes — as well as acute air pollution. The haze from Indonesian forest fires, many deliberately set to clear land for oil palms, caused at least 12,000 premature deaths in 2015 alone.

Huge Palm Oil Plantation in Kalimantan

Abrahm Lustgarten wrote in the New York Times magazine: “The dirt road was ruler straight, but deep holes and errant boulders tossed our tiny Toyota back and forth. Trucks coughed out black smoke, their beds brimming over with seven-ton loads of palm fruit rocking back and forth on tires as tall as people. Clear-cut expanses soon gave way to a uniform crop of oil-palm groves: orderly trees, a sign that we had crossed into an industrial palm plantation. [Source: Abrahm Lustgarten, New York Times magazine, November 20, 2018]

Oil-palm trees look like the coconut-palm trees you see on postcards from Florida — they grow to more than 60 feet tall and flourish on the peaty wetland soil common in lowland tropics. But they are significantly more valuable. Every two weeks or so, each tree produces a 50-pound bunch of walnut-size fruit, bursting with a red, viscous oil that is more versatile than almost any other plant-based oil of its kind.

“Finally we emerged, and as we crested a hill, the plantations fell into an endless repetition of tidy bunches stretching for miles, looking almost like the rag of a Berber carpet. Occasionally, a shard of an old ironwood tree shot into the air, a remnant of the primordial canopy of dense rain forest that dominated the land until very recently. Most of the plantations around us were new.

Destruction and Fires Wrought by Palm Oil in Kalimantan

Orbitas

Abrahm Lustgarten wrote in the New York Times magazine: “The fields outside Kotawaringin village in Central Kalimantan, looked as if they had just been cleared by armies. None of the old growth remained — only charred stumps poking up from murky, dark pools of water. In places, smoke still curled from land that days ago had been covered with lush jungle. Villagers had burned it all down, clearing the way for a lucrative crop whose cultivation now dominates the entire island: the oil-palm tree. [Source: Abrahm Lustgarten, New York Times magazine, November 20, 2018]

After the palm-oil companies gained control of the land, the clearing began. The fastest method was to rip out the forests with excavators and torch what remained. In 2015, the fires spread out of control. Kalimantan — and most of Indonesia, for that matter — was overwhelmed by billowing clouds of smoke and ash, visible from hundreds of miles away. NASA satellites detected more than 120,000 hot spots.Forest fires are an annual event in Indonesia — sparked in the dry early fall as village farmers clear their fields and then extinguished by the monsoons. But this year was different. NASA officials said they were the worst fires they’d ever observed. Indonesians suffering from the effects of smoke inhalation were streaming into hospitals by the tens of thousands. Researchers at Columbia and Harvard later estimated that the fires led to 100,000 premature deaths. And the fires wouldn’t stop.

What scientists found in Kalimantan was not just deforestation and misery but a virtual hole ripped into one of the largest banks of concentrated carbon in existence. At every turn — by motorbike and motorboat — shards of burned stumps, a crop of shimmering silvery charcoal, stuck out from the blackened earth like gravestones. This apocalyptic landscape stretched as far as they could see, punctuated by only the rare tuft of scorched but otherwise healthy juvenile palm. They traced what they describe as telltale signs that the fires had been started by the palm companies — which is illegal and which all the palm-oil companies strongly deny doing, but which is also the fastest, cheapest way to raze the land.

“The process is simple and devastating. First, workers bring in excavators to cut deep trenches across the swampland. These quickly fill with water that drains from the adjacent forest, thereby creating canals that serve as near-instant inroads on which to transport heavy machinery by boat or barge. With the machinery, the forests are cut down, their timber efficiently removed, and the swampy peatland they sit on is left to drain and dry. Once it’s dried, it’s burned.

“In most of the places the scientists visited, the fires appeared to have been extinguished, but the earth remained hot, smoldering underground. And this — more than the landscape destruction itself — was what concerned the group most. The dried and decaying peatland soil in this part of Borneo would almost certainly continue to burn for many more months, even years, releasing volumes of carbon dioxide into the atmosphere that far exceeded those from the rain-forest deforestation itself.

“Peatland is boggy, waterlogged ground, loaded with layers of decomposing plants that can’t get enough oxygen to support the microorganisms that would normally break them down. So they accumulate, layer by layer, season by season, compressing into a dense, black carbon-rich mud of partly decayed matter that sinks below the shallow water table and is preserved there in an anaerobic state. Left alone for a couple hundred million more years, the peat would solidify into coal. Exposed peatland can spew carbon into the atmosphere for decades, even centuries, after the land is first disturbed. Indonesia’s peatland destruction — just the amount that has already occurred — is roughly the equivalent of opening 70 new, large coal-fired power plants.

Impact of Palm Oil on Orangutans

The center map is the Maxent model output map of palm oil expansion in Central Kalimantan, Indonesia; The smaller maps indicate inputs, clockwise from bottom left to right is a map of MODIS NDVI, slope, accessibility, precipitation, elevation, and conservation areas, NASA, Indonesia Agriculture DEVELOP Team

The expansion of palm-oil plantations in Indonesia has contributed to the loss and fragmentation of orangutan habitat. Orangutans depend on tropical forests for food and shelter, but forests and swamps have been cleared and burned to establish oil-palm plantations. As their habitat disappears, orangutans increasingly become isolated in small areas of remaining forest and come into contact with people. [Source: Hannah Beech, New York Times, June 29, 2019]

The case of Hope, a Sumatran orangutan, illustrated the dangers created by this conflict. In 2019, Hope was found near Bunga Tanjung village in Aceh Province after villagers had repeatedly shot at her. She had been struck by 74 air-gun pellets, including several that blinded her, and had suffered deep wounds and broken bones. Her infant was taken from her and later died. Hope had been living in a narrow strip of remaining forest surrounded by areas being converted to oil-palm plantations and had entered village orchards in search of food.

The broader decline of orangutans has been closely associated with the loss of forest habitat. Researchers reported that the orangutan population on Borneo fell by more than 100,000 between 1999 and 2015. Fewer than 14,000 Sumatran orangutans were estimated to remain, after extensive forest loss on the island. Orangutans reproduce slowly, with mothers typically spending 8 to 9 years raising each offspring, making populations particularly vulnerable to sustained habitat loss and adult mortality.

Forest clearing affects orangutans in several ways. Some are killed during fires used to clear land. Others become stranded in isolated patches of forest surrounded by oil palms. When natural food becomes scarce, they may enter plantations or farms and eat crops, which can lead to conflict with farmers. Conservation workers reported that orangutans were sometimes shot when they entered agricultural areas.

How Palm Oil Development Takes Place in Indonesia on Protected Land

Abrahm Lustgarten wrote in the New York Times magazine: “A few days later, we drove north, 20 hours on punishing mountain roads, toward the Malaysian border and the West Kalimantan district of Sintang. There, a meeting was planned with the local county governor, or bupati, to discuss a similar situation. North of Sintang, a grim commercial town of concrete and rebar at a fork in the Kapuas River, two palm plantations were being developed on peatland bogs. These plantations, too, were located on tracts that Indonesian government maps had at one time explicitly labeled protected peatland, which should have placed them under the moratorium on palm development. The maps had since been changed. Yet there was no mistaking that this was peatland: Paths submerged into black goop, teams of dragonflies swarmed over the hot water, reeds and forest grew from their depths. And here came a flatbed truck, carrying an excavator toward the entrance gate, where a guard in a neatly pressed dark blue uniform turned away visitors.[Source: Abrahm Lustgarten, New York Times magazine, November 20, 2018]

“The permits named two obscure companies, but a villager at the gate told us that he thought both plantations were run by the same company and that it had been clearing the forest for months. It’s not uncommon for Indonesian companies to use layers of subsidiaries to hide their connections to illegal palm operations. “We call them shadow companies,” said Eric Wakker, a founder of Aidenvironment Asia, an environmental consultancy that has investigated the two plantations. Upon further scrutiny, it appeared that the two companies may indeed have been linked to the Salim Group. They shared a business address with a Salim subsidiary in Jakarta and employed the same plantation managers in Kalimantan. Salim was also a buyer of the palm that would come from the Sintang plantations.

“The connection matters because the Salim Group has benefited from more than $1.5 billion in loans and capital from foreign investors, including the American firms BlackRock and Vanguard, and Salim companies have pledged that their palm oil is not a product of recent deforestation or peatland destruction. Satellite images from 2017 confirmed that the forests on the Sintang plantations were now virtually gone. (A Salim Group executive, Mark Wakeford, declined to comment about the Sintang companies.)

I pressed him to explain how these peatland forests could be cut down when the government insisted that such land clearing had stopped. The bupati, a doctor named Jarot, had moved to Borneo from Java and had developed a local reputation as a conservationist. He greeted us jovially, barefoot and dressed in bluejeans and a crisp, untucked blue button-down shirt. He said the rural districts must balance economic growth with sustainability, and while he has pledged to control corruption and illegal permits, he also described himself as helpless against the currents of a central government that is close to the big corporations and constantly changes both the rules and the playing field. United Nations forest programs pay communities to leave their trees in the ground. Such funding would help him strike a better balance here, he said, casually shrugging off the plantation case I asked about. “We do what we can do,” Jarot said. “We cannot do it by ourselves. ... We need a fiscal incentive.”

“An aide offered a more nuanced explanation. The phrases “peatland” and “forest” have distinct legal meanings in Indonesia, he claimed; not all treed areas are forests, and not all peat-filled bogs are peatland. In the strictest legal sense, he was correct. The Sintang regency alone, according to Indonesian government estimates, contains more than 160,000 acres of old-growth, heavily treed land that it has not designated as “forest” under the law and more than 86,000 acres of nondesignated peatland. After a request from the companies, the government maps for Sintang were revised to change the peatland borders. New maps show the bog boundaries tracing perfect 90-degree angles and straight lines — lines that happen to match the boundaries of the companies’ land holdings. How do you account for such details in a life-cycle analysis?

Efforts to Rein in the Palm Oil Industry in Indonesia

Indonesia has introduced measures intended to slow deforestation associated with palm-oil expansion while maintaining the economic benefits of the industry. In September 2018, the government imposed a moratorium on issuing new palm-oil plantation permits. The policy was intended to reduce deforestation and encourage companies to increase production from existing plantations rather than continually expanding into new forest areas. The moratorium was initially established for 3 years.

Environmental organizations argued that the moratorium was not sufficient because existing concessions could still contain large areas of forest and because implementation was not always transparent. Government data cited in 2021 showed that about 1.49 million hectares of unused plantation concessions had been identified and more than 1.5 million hectares were being used in ways that did not correspond to their permits. Environmental groups called for unused or improperly managed concessions to be reviewed and, where appropriate, returned to forest status.

Deforestation nevertheless continued in some areas despite restrictions. Forest Watch Indonesia estimated in 2021 that more than 21 million hectares of forest could potentially be threatened by future palm-oil expansion if restrictions were removed. The plantation frontier was also moving eastward toward Papua, where extensive forests and peatlands remained. Conservation groups therefore argued that Indonesia needed stronger land-use planning, clearer monitoring and better enforcement rather than relying solely on a temporary moratorium.

Efforts to regulate palm oil have also focused on making existing plantations more productive so that production can increase without clearing additional forest. Governments and conservation groups have promoted better enforcement of concession boundaries, protection of high-conservation-value forests and restrictions on development in peatlands. The broader challenge is to reconcile the industry's importance to Indonesia's economy with the protection of forests, biodiversity, carbon stores and community land rights. The effectiveness of these measures depends heavily on transparency, enforcement and the ability of national and local authorities to prevent illegal or unauthorized land conversion.

Image Sources: Wikimedia Commons

Text Sources: “Encyclopedia of World Cultures Volume 5: East/Southeast Asia:” edited by Paul Hockings, 1993; “Culture and Customs of Indonesia” by Jill Forshee, Greenwood Press, 2006; National Geographic, New York Times, Washington Post, Los Angeles Times, Smithsonian magazine, Encyclopedia.com, Library of Congress, Indonesia Tourism website (indonesia.travel), Indonesia government websites, Live Science, The Conversation, The New Yorker, Time, BBC, CNN, Reuters, Associated Press, AFP, Lonely Planet Guides, Google AI, Wikipedia, The Guardian and various websites, books and other publications.

Last updated August 2026