Oil Palm Production and Conservation of Natural Resources: Can We Get It All?

Patricio Grassini, associate professor and cropping system specialist, Department of Agronomy and Horticulture, University of Nebraska-Lincoln Author

02/12/2021 Added

25 Plays

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While the environmental impact associated with oil palm expansion in Indonesia has received lot of attention, there is little dialogue on a solution agenda that could help the country to reconcile economic and environmental goals. This seminar presents results from a UNL project that aims to find that balance via intensification, that is, by increasing productivity on existing cropland.

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[00:00:00.810]The following presentation
[00:00:02.260]is part of the Agronomy and Horticulture Seminar Series
[00:00:05.850]at the University of Nebraska Lincoln.
[00:00:08.190]Now welcome to the Agronomy Horticulture
[00:00:11.150]Seminar Series for spring of 2021.
[00:00:15.200]I get the pleasure to introduce
[00:00:17.040]and host Patricio Grassini today.
[00:00:20.810]Patricio Grassini is actually a Systems Agronomist
[00:00:25.200]in the Department of Agronomy Horticulture,
[00:00:26.870]he has been here since about 2013.
[00:00:31.175]His role has been primarily working
[00:00:34.170]with things like yield forecasting,
[00:00:38.010]as Yield Forecasting Center for the Midwest.
[00:00:42.610]He's also been involved
[00:00:43.820]with the soybean benchmarking projects
[00:00:48.170]that have been going across the Midwestern U.S.
[00:00:51.850]and then for a long time he's been involved
[00:00:53.700]with this Global Yield Gap Atlas project.
[00:00:57.250]That's kind of an international project
[00:01:00.560]that's been going on for at least 10 years
[00:01:02.620]but maybe he'll give us more background on that,
[00:01:04.470]the full background on that.
[00:01:07.900]Patricio has been,
[00:01:08.950]well he has a 70% research,
[00:01:10.590]30% extension appointment
[00:01:12.130]and he's been very productive over the years.
[00:01:15.197]He's published many papers
[00:01:17.570]over the last several years anyway in each year
[00:01:20.780]and has been listed on the Web of Science
[00:01:25.100]list of Highly Cited Researchers.
[00:01:27.310]He's very productive,
[00:01:28.380]he's has a great connections throughout the world
[00:01:32.180]and some of these things that he's working on
[00:01:34.100]and one of the projects that he got involved
[00:01:36.810]with this is to get the Global Yield Gap Atlas
[00:01:39.830]involved with oil palm in Indonesia
[00:01:42.340]and that's what he's going to talk about today.
[00:01:45.580]So Patricio?
[00:01:48.151]Well, thank you very much John
[00:01:49.210]for a very generous introduction
[00:01:51.130]and also thanks very much to the seminar committee
[00:01:54.670]for giving me the chance to talk about our project
[00:01:57.730]on Oil Palm in Indonesia.
[00:02:00.480]So let's get it started.
[00:02:05.357]All right so I'm gonna give you some background
[00:02:07.811]about the oil Palm because I'm assuming that most
[00:02:09.670]of you is probably the first time
[00:02:11.173]that you are hearing about this.
[00:02:14.080]Oil palm is the most important source
[00:02:15.660]of vegetable oil in the world.
[00:02:17.960]You are probably surrounded by oil palm
[00:02:19.630]although you may not know that.
[00:02:21.869]But in the morning when you shave
[00:02:24.020]or when you get a shower
[00:02:26.020]you are using oil palm in the shampoo,
[00:02:28.000]in the creams, in the perfume, on everything.
[00:02:31.110]When you eat, you're eating oil palm
[00:02:33.790]and if you are now eating a cookie bread,
[00:02:35.970]that cookie also has oil palm.
[00:02:38.310]What about miss oreo?
[00:02:40.140]It can be used for so many products
[00:02:42.190]that you cannot imagine.
[00:02:45.347]The the commodity is called crude palm oil (CPO)
[00:02:48.170]and that's the major source,
[00:02:49.690]is one of the major source of income for Indonesia
[00:02:52.990]which is the biggest producer of this commodity,
[00:02:55.690]producing about 40 million tons per year.
[00:03:00.006]And there are about 14 million hectares
[00:03:01.910]of land planted with oil palm in Indonesia,
[00:03:04.440]at least based on the statistics by year 2018,
[00:03:07.560]probably they are closer to 16 nowadays.
[00:03:13.200]But this is an example of a large plantation
[00:03:16.240]located in Sumatra.
[00:03:18.930]Roughly 50% of the oil palm in Indonesia
[00:03:22.700]is managed by private companies
[00:03:25.070]and each farm,
[00:03:26.840]each state can include thousands of hectares
[00:03:29.358]planting oil palm.
[00:03:30.330]You can see the extent of this field.
[00:03:33.880]On the other hand about 50% of the oil palm in Indonesia
[00:03:36.910]is managed by smallholders.
[00:03:38.870]This is a pictures that I took in Kalimantan,
[00:03:41.260]in Borneo
[00:03:43.463]and these are smallholders account
[00:03:46.267]for about 50% of the oil palm area in the country.
[00:03:49.440]In each of these smallholders manage
[00:03:51.255]an area of about two hectares.
[00:03:54.050]So if you do the math 6 million hectares
[00:03:56.050]divided by two hectares of oil palm,
[00:03:58.080]that gives you the number of 3 million
[00:04:00.240]oil palm in smallholders.
[00:04:01.687]And you need to add on top of that
[00:04:03.760]all the relatives are also depending
[00:04:06.800]on the oil palm production.
[00:04:08.330]So as you can see,
[00:04:09.163]a lot of people depends on oil palm in Indonesia.
[00:04:12.410]And either you're a large or a small farmer,
[00:04:16.060]this is what you're looking for.
[00:04:17.350]This picture here shows the bunches,
[00:04:20.410]the oil palm bunches
[00:04:21.243]they're called fresh fruit bunches (FFB).
[00:04:24.920]That's what the farmers get paid for
[00:04:27.210]and typically the,
[00:04:28.550]you get the oil extraction rate
[00:04:30.920]from these bunches is an average 20%.
[00:04:35.500]Each of these bunches weight around 20 kilograms
[00:04:39.500]and they have up to 3000 fruits per bunch.
[00:04:43.690]And this is how each of the individual fruits look like
[00:04:46.240]and if you take one of these individual fruits
[00:04:48.980]the concentration of oil is around 40 to 55%.
[00:04:55.390]All right so oil palm is a brilliant crop,
[00:04:58.180]in it's high-yield.
[00:05:00.110]In this schema here
[00:05:01.370]shows the typical annual yield versus age pattern
[00:05:06.380]for a well managed oil Palm plantation.
[00:05:09.320]Note that I'm expressing, yield here as FFB,
[00:05:11.820]that's the fresh fruit bunches in tons per hectare per year,
[00:05:15.400]But also on the right axis I'm showing the oil yield
[00:05:19.800]which is basically the product of FFB times 0.2,
[00:05:24.130]which is the average extraction rate.
[00:05:26.880]In a normal plantation,
[00:05:29.571]there are two, three years after planting when
[00:05:31.200]there is no bunch production.
[00:05:33.640]After that the plantation start to produce its bunches
[00:05:36.420]and the productivity steeped up
[00:05:40.020]until it reaches a peak around the years seven or so.
[00:05:43.770]And after that the plantation would go through
[00:05:46.020]a gradual decline in productivity
[00:05:48.510]until it gets replanted around year 25.
[00:05:52.450]The reason why the plantation gets replanted around 25
[00:05:55.280]is because of the declining productivity,
[00:05:58.040]but also because of the palms just get too high,
[00:06:00.690]too tall to get harvest.
[00:06:03.390]Now, just to give you an idea about
[00:06:05.570]how the oil palm productivity compares with other crops.
[00:06:10.580]You can see here the annual product,
[00:06:12.480]the annual oil productivity for soybean, canola
[00:06:15.120]and sunflower average for oil crops as well.
[00:06:18.540]And you can see how much all oil palms produces
[00:06:22.390]compared with these other crops.
[00:06:24.750]So there is a good reason why oil palm
[00:06:27.150]is a major source of oil globally.
[00:06:31.480]Now let's talk a little bit
[00:06:32.313]about yield formation in oil palm.
[00:06:35.060]If you go to a plantation,
[00:06:36.040]you will find around 150 palm trees per hectare
[00:06:39.710]and you will find bunches
[00:06:42.870]that are at a very different stage of development.
[00:06:46.760]So how is that possible?
[00:06:48.750]If you dissect upon,
[00:06:51.090]what you will find is that there is a new leaf
[00:06:54.680]initiated every two weeks,
[00:06:56.690]in associated with that leaf
[00:06:59.360]there is these small inflorescence,
[00:07:02.460]these are primordial.
[00:07:03.797]And this is what in near future is gonna become a bunch.
[00:07:06.690]In this case these are female primordial,
[00:07:09.680]which if everything goes well in 40 months
[00:07:12.510]will become a ripe bunch that can be harvested.
[00:07:16.900]Now six differentiation of that primordial,
[00:07:20.440]in the survival of that primordial
[00:07:22.430]is highly dependent on the management and the environment.
[00:07:26.210]So for example,
[00:07:27.570]if the management is poor
[00:07:29.530]or if the Palm is growing in a stressful environment
[00:07:33.720]you will find that there are more male inflorescence
[00:07:36.480]compared with females inflorescence
[00:07:38.197]and you will also find a higher rate of abortion
[00:07:41.060]of those inflorescence.
[00:07:43.522]Something that is important to consider here
[00:07:48.770]is that because of this long period
[00:07:51.720]between initiation and bunch ripeness,
[00:07:55.810]whatever we do now in terms of management
[00:07:57.827]of the plantation will have an effect later on.
[00:08:02.990]So for example,
[00:08:03.840]if I apply fertilizer today
[00:08:05.890]I will see the full effect
[00:08:07.210]of that fertilizer on yield 40 months down the road.
[00:08:11.150]So there is this time lag associated with implementation
[00:08:15.430]of a management practices
[00:08:16.790]and the impact in yield
[00:08:18.320]that is very unique of oil palm compared with other crops.
[00:08:25.110]So if you go to a field and you see
[00:08:28.252]a palm with loose fruits around the trunk,
[00:08:30.390]that means that that palm has a bunch
[00:08:32.093]that can be harvested,
[00:08:33.440]that's what farmers uses to tell
[00:08:36.350]when the bunches are ready to be harvested.
[00:08:39.110]But because there are bunches ripening all the time
[00:08:41.680]then farmers need to pretty much go to the field
[00:08:45.390]every Sunday to check which bunches are ready
[00:08:47.700]to be harvested and which ones not.
[00:08:49.960]Going there every day it's just too labor intensive,
[00:08:52.740]so typically farmers will go to the field
[00:08:55.420]two, three times per month.
[00:08:57.710]If they go more than that involves too much labor,
[00:09:00.020]if they go less than that
[00:09:01.920]that means that there will be lot of harvest losses.
[00:09:05.000]So two to 3 harvest rounds is the right compromise
[00:09:07.820]between minimizing labor while making sure
[00:09:10.810]to minimize the harvest losses.
[00:09:13.070]In all cases the harvest is manual
[00:09:15.450]as you can see in the picture here in the middle
[00:09:18.120]and these bunches are brought
[00:09:20.310]to the edge of the field
[00:09:21.950]where a middle man comes with a small truck,
[00:09:24.870]weights the bunches,
[00:09:25.900]the farmer gets paid,
[00:09:26.760]and this middle man will bring all the bunches
[00:09:29.520]to the mill where the oil is extracted.
[00:09:34.370]Okay, so what's the theory with oil palm?
[00:09:39.202]The theory is that during the past 20 years
[00:09:41.517]the CPO production has mostly increased
[00:09:44.360]at the expense of area expansion.
[00:09:47.430]Indonesia has been expanding the oil palm area
[00:09:49.330]at the rate of a half million hectares per year.
[00:09:52.520]So every year half million hectares
[00:09:55.614]of land are converted for oil palm cultivation.
[00:09:57.970]And during the same time period
[00:10:00.770]there has been no increase on average yield.
[00:10:04.250]So basically all increasing production
[00:10:06.200]in the past two decades has been
[00:10:07.970]at the expense of increasing area
[00:10:10.130]with no increasing productivity.
[00:10:12.210]And one third of the converted land,
[00:10:14.890]is accounted by forest and peatlands.
[00:10:18.370]And looking forward,
[00:10:20.300]the demand for oil palm is expected to increase
[00:10:23.580]at least by 50% but that demand is expected
[00:10:27.450]to be even higher because of the recent mandates
[00:10:29.840]on CPO-based biodiesel.
[00:10:32.910]And therefore there are concerns
[00:10:35.620]about further land conversion
[00:10:37.090]for oil palm cultivation and the associated loss
[00:10:40.020]in biodiversity and emissions of greenhouse gases.
[00:10:44.660]In along those lines Indonesia has committed
[00:10:46.820]to different programs to reduce deforestation
[00:10:50.480]and greenhouse gas emissions.
[00:10:52.750]So as you can see,
[00:10:54.100]this is a country that has
[00:10:55.780]many potentially conflicting goals.
[00:10:58.800]And so we have here oil Palm
[00:11:01.890]and we have here forest competing for land
[00:11:04.090]and fortunately we know who is gonna win
[00:11:06.230]and who is gonna lose.
[00:11:09.030]And in some of these environmental issues
[00:11:11.900]related with oil palm cultivation in Indonesia
[00:11:14.120]has been picked and highlighted by the media
[00:11:18.120]sometimes making long stretches.
[00:11:21.179]In along those press news,
[00:11:24.790]there has been a strong campaign
[00:11:27.060]and also policy to ban oil palm export from Indonesia
[00:11:30.890]or to reduce oil palm products with a good intention
[00:11:35.480]of protecting their forest and the peatlands.
[00:11:38.310]However, these efforts have not led
[00:11:40.340]to any real solutions agenda that stop deforestation.
[00:11:44.570]And one of the reasons is that
[00:11:45.800]these approaches neglect the simple fact that
[00:11:49.540]Indonesia is producing oil palm
[00:11:51.110]because the world is demanding more oil palm.
[00:11:55.150]And embodying oil palm will simply shift the problem
[00:11:58.470]from oil palm in Indonesia to another crop in another region
[00:12:01.790]for example soybeans in Brazil or some other case.
[00:12:05.400]So as you can see,
[00:12:06.710]we have very contrasting positions here.
[00:12:09.330]On one side we have Indonesia's aspirations to develop,
[00:12:14.370]a millions of farmers who want to produce more oil palm
[00:12:17.780]as a way to get out of poverty
[00:12:20.840]and on the other side We have developed countries
[00:12:23.370]asking Indonesia to not produce oil palm
[00:12:26.000]because they want to conserve the rainforest.
[00:12:28.750]So how do we get out of this as one?
[00:12:34.870]One of the things that is clear is
[00:12:36.260]that we cannot simply ask developing countries
[00:12:39.440]to give up on their economic goals
[00:12:41.810]to fit the environmental agenda of developed countries.
[00:12:45.080]And therefore what is really needed here
[00:12:46.990]is a solutions agenda that seeks to find a compromise
[00:12:52.000]between production and environmental goal
[00:12:54.770]and this idea has been very nicely summarized
[00:12:56.880]by Mike Shellenberger who is an environmental activist
[00:13:02.310]and he says that "If we are to protect the
[00:13:04.967]"world's remaining forest we are going to need
[00:13:08.357]"to reject the environmental colonialism
[00:13:10.207]"and support nations in the aspirations to develop."
[00:13:13.390]So bottom line is that we need to find a compromise
[00:13:16.640]here between economic aspirations and protection goals.
[00:13:22.550]So along those lines,
[00:13:23.890]our project here aims to understand
[00:13:27.750]to which degree intensification of existing
[00:13:30.910]oil palm area can help Indonesia
[00:13:33.390]to reconcile the production and environmental goals.
[00:13:36.890]Understanding that intensification,
[00:13:39.350]which is understood as increasing in year,
[00:13:42.520]intensification is only just one piece of the challenge.
[00:13:45.150]It needs to be complemented
[00:13:46.310]with appropriate policy and institutions to make sure
[00:13:48.850]that there is land sparing for nature.
[00:13:51.630]But again,
[00:13:52.640]our idea here is to see to which degree
[00:13:55.070]increasing productivity on the existing oil palm area
[00:13:57.700]in Indonesia can help the country
[00:13:59.560]to reconcile this conflicting goals.
[00:14:01.260]This is a project that has started
[00:14:03.714]about two to three years ago
[00:14:06.410]and it's being funded by the Norwegian Ministry
[00:14:08.360]of Foreign Affairs at the level of 4 million dollars.
[00:14:12.730]This is the core team and involves
[00:14:13.563]mostly researchers from University of Nebraska.
[00:14:17.592]But those in both partners from Indonesia
[00:14:20.300]including the Indonesian Oil Palm Research Institute,
[00:14:22.883]The Indonesian Agency for Agricultural Research
[00:14:24.980]and Development which will be the equivalent
[00:14:26.938]of the USDA in Indonesia
[00:14:28.396]and also the University of Indonesia.
[00:14:32.753]And then we are also partnering with a number
[00:14:34.943]of local NGOs who are the responsible to
[00:14:37.680]collect the local data.
[00:14:40.022]This is not the whole team.
[00:14:42.130]because we also have a number of partial workers
[00:14:45.240]that help us with,
[00:14:46.210]to collect the data and with experiments.
[00:14:48.330]So overall there are,
[00:14:49.840]I will say no less than a hundred people
[00:14:52.220]involved in this project
[00:14:53.457]and sometimes I'm having trouble to sleep
[00:14:55.450]at night thinking how many can,
[00:14:57.170]on how many people depends on our project.
[00:15:00.940]So the very first phase of this project
[00:15:03.330]was about estimating the size of the yield gap.
[00:15:06.640]We wanted to understand how much below farmers
[00:15:11.100]oil palm plantations were in relation
[00:15:13.120]to the potential productivity.
[00:15:16.490]Now, and this shows estimatically the yield potential
[00:15:21.085]for an oil palm plantation
[00:15:22.435]in which the yield potential is driven by the light,
[00:15:25.240]by the temperature, by carbon dioxide,
[00:15:27.260]the water supply by soil type,
[00:15:29.610]and also the age of the plantation.
[00:15:32.490]Now reaching the yield potential
[00:15:34.073]it's very difficult.
[00:15:35.750]It requires a lot of inputs
[00:15:37.030]and requires logistics that are not applicable
[00:15:39.450]really in commercial plantations.
[00:15:42.230]And therefore a more realistic goal
[00:15:44.510]for plantations is to reach about 75%
[00:15:47.580]of the yield potential
[00:15:48.960]which we call here as attainable yield.
[00:15:51.660]So trying to shoot for that attainable yield,
[00:15:54.760]is something reasonable for farmers
[00:15:56.290]who seek to maximize profit.
[00:15:59.280]And then we have the third production level
[00:16:01.632]that corresponds to the actual average productivity
[00:16:04.200]which in most cases is limited by nutrients,
[00:16:06.700]pests, poor management, poor planting material.
[00:16:10.060]And the difference between this attainable yield
[00:16:12.820]and this average plant yield,
[00:16:15.000]plantation yield is the exploitable yield gap.
[00:16:18.630]In understanding the size of the yield gap
[00:16:20.510]is very important
[00:16:21.830]because it's telling us how much extra oil palm
[00:16:25.120]Indonesia can produce on existing plantation
[00:16:28.280]without need to further convert land for plantation.
[00:16:32.520]So again in this first of,
[00:16:33.910]in this very first phase of the project,
[00:16:36.060]we aim to estimate the size of this yield gap
[00:16:39.570]to understand to which degree
[00:16:41.230]Indonesia can meet the future demand for oil palm
[00:16:44.070]on existing plantation area.
[00:16:49.230]To accomplish that goal,
[00:16:50.520]we follow a quite complex protocol.
[00:16:53.640]As you can imagine estimating the yield gap
[00:16:55.420]for perennial crops it's not the easiest thing.
[00:16:58.220]So we have to adapt many things that we usually apply
[00:17:01.120]for other crops.
[00:17:02.570]So this in a nutshell the them
[00:17:04.750]the protocol that we follow
[00:17:07.670]to estimate the yield gap for oil palm
[00:17:10.020]we started by selecting a number
[00:17:11.700]of representative locations where oil palm
[00:17:14.520]is grown in Indonesia.
[00:17:17.270]For each of those sites we collected weather data
[00:17:20.880]that we have to use to estimate the yield potential
[00:17:22.950]because the yield potential depends on weather.
[00:17:26.220]And also because yield potential depends on soil,
[00:17:28.630]we have to collect information
[00:17:30.240]about the dominant mineral soil
[00:17:32.350]in each of these places across the country.
[00:17:35.910]And as I explained before,
[00:17:37.980]there are two different farm types in Indonesia,
[00:17:40.870]large plantations, smallholders
[00:17:42.930]and we have to collect information separately
[00:17:44.920]for each of these farmer topologies
[00:17:48.443]and also in separate information
[00:17:50.170]on the actual average productivity.
[00:17:53.030]We use crop modeling to estimate the yield potential,
[00:17:55.830]we fed those models with the word three times
[00:17:57.873]the soil data to estimate the yield potential
[00:18:00.670]for each of these sides across the country.
[00:18:02.940]And eventually we compare the yield potential
[00:18:05.050]simulated by our models
[00:18:07.010]against the average productivity reported
[00:18:09.680]for a smallholders and large plantations
[00:18:12.060]to arrive to an estimate of yield gaps
[00:18:14.520]for each of these two farmer categories.
[00:18:19.890]And this is a snapshot of the results on yield gaps
[00:18:23.000]for the sites for which we estimate
[00:18:25.900]the yield gaps in Indonesia.
[00:18:27.880]So in this figure you will see these pie charts.
[00:18:30.890]The important thing to know here is that
[00:18:32.630]the yellow portion of the pie corresponds
[00:18:36.837]to the average yield,
[00:18:38.490]the red portion of the pie corresponds to the yield gap.
[00:18:42.440]So if you see a small portion of red
[00:18:46.120]that means that the yield gap is small.
[00:18:48.930]If you see a large portion of the pie covered in red
[00:18:52.090]that means that the large,
[00:18:53.130]that the yield gap is large.
[00:18:55.090]And in general you can see that
[00:18:57.160]the yield gaps are quite small in Sumatra Island,
[00:19:00.370]they are larger in Borneo,
[00:19:02.970]but on average for large plantations in Indonesia,
[00:19:07.630]the exploitable yield gap
[00:19:08.740]is around 11.9 tons per hectare per year,
[00:19:13.410]which when expressed relative to the yield potential
[00:19:17.370]for large plantations is equivalent to 38%.
[00:19:20.900]So in other words,
[00:19:22.190]large plantations in Indonesia
[00:19:24.260]are producing 38% below their potential.
[00:19:30.470]All right so this is,
[00:19:31.540]this map corresponds to large plantations.
[00:19:33.870]In the next slide I'm gonna show the same information,
[00:19:36.710]but for a smallholders
[00:19:37.780]and you will see more red in this map.
[00:19:40.820]And that means that the exploitable yield gap
[00:19:43.280]is larger for a small holders.
[00:19:45.144]And on average at the country level,
[00:19:47.944]the smallholders yields are only half
[00:19:51.550]of the attainable yield.
[00:19:54.130]Which means that there is,
[00:19:55.730]especially for a small holders a large,
[00:19:58.360]a big opportunity there to produce more
[00:20:00.690]on the existing plantation.
[00:20:02.700]So again moderate yield gap for large plantations,
[00:20:07.240]very large yield gaps for a smallholders.
[00:20:10.820]Now, what does it mean for Indonesia?
[00:20:13.040]All these yield gaps.
[00:20:14.000]What's the opportunity cost associated
[00:20:16.550]with this yield gaps?
[00:20:19.281]In this table You can see the two farm types,
[00:20:21.240]the large plantations and the smallholders
[00:20:23.090]and you can also see the average for Indonesia.
[00:20:25.680]This is the current area for each farmer type.
[00:20:29.680]This is the current exploitable yield gap
[00:20:32.910]and this is the extra production potential.
[00:20:35.640]So if we do some simple math here
[00:20:37.380]and we multiply area by the exploitable yield gap,
[00:20:40.280]that is gonna tell us how much more oil palm
[00:20:44.010]Indonesia can produce if they close their existing gap.
[00:20:50.170]So if we sum up the extra production potential,
[00:20:52.860]derived from yield gap closure in large plantations,
[00:20:56.030]in a small holders,
[00:20:57.340]the sum tell us that Indonesia
[00:20:58.690]can potentially produce 64% more oil palm
[00:21:02.989]on the existing plantation area.
[00:21:04.890]We don't need to expand into forest,
[00:21:07.210]we don't need to expand into peatlands.
[00:21:10.450]Now these are excellent good news,
[00:21:14.170]but the problem is that this number
[00:21:17.510]they don't tell us too much unless we compare them
[00:21:20.460]against the future expected demand for oil palm
[00:21:24.737]and also understanding what's the timeline
[00:21:28.570]to reach that demand
[00:21:30.170]and what's the rate at which we can close the gap.
[00:21:33.640]So we did some scenario analysis
[00:21:36.020]looking at a year 2035
[00:21:38.340]that's 15 years down the road.
[00:21:41.190]In this field here what you can see on the vertical axis
[00:21:44.920]is the FFB production,
[00:21:47.200]the fresh fruit bunches production.
[00:21:50.940]On the horizontal axis is the harvested area
[00:21:54.117]and these lines represents different yield levels.
[00:21:56.650]This is the,
[00:21:57.483]these lines corresponds to 18 tons per hectare,
[00:21:59.840]these lines corresponds to 30 tons per hectare.
[00:22:04.029]This gray circle here on the lower left corner,
[00:22:08.260]represents Indonesia production around year 2000.
[00:22:14.867]This other cycle represents Indonesia production
[00:22:17.800]by year 2018.
[00:22:19.387]And this horizontal dash lines corresponds
[00:22:22.410]to the expected oil palm demand by year 2035.
[00:22:26.920]So this is the past,
[00:22:28.780]this is the present
[00:22:30.290]and this is where Indonesia is gonna be in 15 years.
[00:22:36.270]Now, if we look backwards
[00:22:38.780]we can see that from year 2000
[00:22:41.520]between the year 2000 and year 2018
[00:22:45.350]Indonesia increased the production from near 50
[00:22:49.980]up to 200 million tons of FFB per year.
[00:22:55.250]But that was,
[00:22:56.370]can be percent at the expense of more area in Indonesia
[00:23:00.100]converted 9 million hectares of land
[00:23:02.560]for oil palm production.
[00:23:04.390]Now lets try to explore the future.
[00:23:07.990]If we first explore a business as usually scenario
[00:23:13.740]in which Indonesia basically kept going
[00:23:16.470]with the same model of land use expansion
[00:23:20.480]without any yield increase,
[00:23:22.890]that that will take Indonesia
[00:23:25.640]to the promise land in terms of production goal.
[00:23:29.280]But that will be at the expense
[00:23:30.711]of an extra 8.5 million hectares of new land
[00:23:35.500]which is roughly equivalent to half Nebraska.
[00:23:40.710]Now, if we explore a second scenario
[00:23:42.800]where we imagined for one moment,
[00:23:46.400]that all oil Palm farmers in Indonesia
[00:23:49.640]will close the exploitable yield gap
[00:23:52.100]on existing plantation area without any expansion,
[00:23:56.170]that has also the potential to bring Indonesia
[00:24:00.630]above the production goal by year 2035.
[00:24:04.090]So, but that will also require
[00:24:08.050]very high rates of annual yield gains
[00:24:11.810]so that Indonesia will need
[00:24:12.980]to increase average oil palm yields
[00:24:14.780]by 700 kilos per hectare per year,
[00:24:17.150]which is very high.
[00:24:18.800]And it almost sounds like a miracle
[00:24:20.820]if we take into consideration
[00:24:22.370]that average yields have remained the same
[00:24:25.000]over the past 20 years.
[00:24:27.190]So probably a more realistic preference scenario
[00:24:31.060]would be one in which we allow some selective expansion
[00:24:36.200]avoiding peatlands in forest
[00:24:38.420]and at the same time we try to close the yield gap
[00:24:42.070]by increasing yields at rates
[00:24:44.060]that are more reasonable around 200 kilos
[00:24:46.860]of FFB per hectare per year,
[00:24:48.600]which is comparable to the rates
[00:24:50.250]that we achieve at global level
[00:24:52.010]for major food crops such as rice, maze, and wheat.
[00:24:56.410]And by following this scenario,
[00:24:58.300]you can see that Indonesia will also
[00:25:00.750]reach the production goals.
[00:25:03.480]Now, bottom line is that the three scenarios
[00:25:07.013]will allow us to reach the production goal by year 2035
[00:25:11.590]but the how is very different.
[00:25:15.050]If Indonesia follows the business as usually scenario,
[00:25:18.010]the production goal is met at the expense
[00:25:20.150]of 9 million hectares of land.
[00:25:22.680]With intensification,
[00:25:24.460]as shown here with the second and third scenario
[00:25:27.340]the land requirement is smaller
[00:25:28.830]and our chances to save peatlands
[00:25:31.240]and rainforests are higher.
[00:25:34.240]So the main messages from this first phase
[00:25:36.250]of the project are that
[00:25:38.640]first that there is a large exploitable yield gap
[00:25:41.080]in current oil palm plantations about 42%.
[00:25:45.500]So on average plantations are producing 42%
[00:25:49.580]below their potential or the attainable yield,
[00:25:52.590]with larger gaps in a smallholder farms.
[00:25:55.819]Indonesia can potentially produce 64 more
[00:25:58.473]of Palm oil on existing plantation area
[00:26:00.800]located in mineral soils,
[00:26:03.910]but time may not be on our side.
[00:26:06.510]Meeting the CPO goal by year 2035
[00:26:09.130]only through intensification would require rates
[00:26:12.120]of yield gains that are very high
[00:26:13.870]and very unlikely to occur .
[00:26:17.340]And as I showed members is
[00:26:19.153]a more realistic preferred scenario would be one
[00:26:21.250]in which we allow some land expansion
[00:26:24.231]in avoiding peatlands,
[00:26:26.770]avoiding prime forest
[00:26:28.450]and we aspire for more realistic yield gains.
[00:26:34.220]And in that approach,
[00:26:35.600]we'll save nearly 3 million hectares
[00:26:37.430]of forest in peatlands and avoid a big amount
[00:26:41.040]of emissions compared to follow
[00:26:44.070]in the historical trajectories on yield land-use change.
[00:26:49.880]All right, so I'm now gonna switch
[00:26:51.670]into the solutions agenda.
[00:26:54.420]About a year ago we have a study with a second phase
[00:26:57.110]of this project where we aim to close the yield gap.
[00:27:01.020]Specifically, what we're trying to accomplish here
[00:27:03.020]is to first identify the causes for the yield gaps
[00:27:06.410]and evaluate cost-effective management practices
[00:27:09.560]to increase oil palm yields in smallholders plantations
[00:27:13.750]located in mineral soils in Indonesia.
[00:27:16.070]So again,
[00:27:16.903]our second phase of the project targets a smallholders
[00:27:20.530]and we are trying to close the exploitable yield gaps.
[00:27:25.380]We are working in six sites across the province.
[00:27:29.280]I guess that you're now familiar
[00:27:30.800]with the geography of Indonesia,
[00:27:32.210]but basically this Island here is Sumatra.
[00:27:35.500]This one here is Kalimantan or Borneo,
[00:27:38.090]that's how most Westerners know it.
[00:27:42.520]And we are working in these three provinces,
[00:27:44.040]Riau here, Jambi, south Sumatra
[00:27:46.950]and also in West, Central and East Kalimantan.
[00:27:51.500]Our places are located in mineral soils,
[00:27:54.750]not in pillars and they're located
[00:27:56.800]far from the areas where oil palm is expanded
[00:28:00.520]because we don't want our intensification
[00:28:03.200]to promote land expansion.
[00:28:07.950]So there are two main activities associated
[00:28:09.890]with this project.
[00:28:11.230]One is a survey of 200 farmers in each province,
[00:28:15.140]total of 1200 farmers
[00:28:17.580]including agronomic and socio-economic factors.
[00:28:20.570]It also field land survey in which
[00:28:24.890]our experts go to the field
[00:28:26.710]and measure a number of things.
[00:28:30.538]And the objective of these activities
[00:28:32.360]is to identify the causes for the yield gap.
[00:28:35.520]The second main activity is to run field trials
[00:28:39.550]to demonstrate the effectiveness
[00:28:41.830]of best management practices (BMPs)
[00:28:45.050]in increasing yield and profit for smallholders
[00:28:48.190]and hopefully to help develop a solutions agenda.
[00:28:53.760]This is our map that corresponds
[00:28:57.100]to one of our villages in this case is,
[00:28:59.650]the village seems like Kalimantan.
[00:29:01.890]Each of these polygons corresponds
[00:29:03.590]to one of the 200 farmers in this village
[00:29:06.020]that we are working with.
[00:29:07.920]And you can see that these fields are quite small.
[00:29:09.900]In an average, each of these smallholders manage an area
[00:29:14.010]of two hectares planted with oil palm.
[00:29:18.410]What do we know on those 200 fields?
[00:29:21.500]First of all we have run our baseline survey
[00:29:24.330]across the 200 farmers
[00:29:26.200]to understand a little bit
[00:29:27.033]about their socioeconomic background.
[00:29:29.230]To understand something about their thinking skills.
[00:29:32.270]That baseline survey was run at the beginning
[00:29:34.050]of the project,
[00:29:34.900]is a one time survey
[00:29:37.239]and it was conducted by our NGOs partners.
[00:29:40.100]That survey also included a very detailed mapping
[00:29:42.490]of the farmer field,
[00:29:44.800]because sometimes farmers will tell you
[00:29:46.870]that the area is maybe two hectors
[00:29:48.937]but when you go there it's about 1.5
[00:29:51.630]and that really matters
[00:29:53.020]because then when you're trying to estimate yield
[00:29:54.970]a small discrepancies in areas will result
[00:29:57.903]into a huge bias in terms of productivity per area.
[00:30:02.290]After we conducted this initial baseline survey
[00:30:05.390]we started to run these farmer daily diary
[00:30:09.930]in which each farmer is asked to keep a diary
[00:30:13.120]in which they will take records
[00:30:15.680]of their management practices on their oil palm fields.
[00:30:19.010]So every time these farmers harvest and they sell FFB,
[00:30:23.100]they need to record it,
[00:30:24.420]they need to indicate how much got paid for that oil palm,
[00:30:28.020]they need also to indicate every time they fertilize
[00:30:30.580]or they without in a year
[00:30:32.189]to explain how much labor they use,
[00:30:34.640]what was the cost of the labor.
[00:30:35.870]The objective of these diaries is to have an idea
[00:30:39.400]about the productivity of these fields
[00:30:41.400]as well as the profit of these farmers.
[00:30:43.960]And then finally there is this land surveying.
[00:30:46.130]Is a one time salary again
[00:30:48.710]which has already been completed for three provinces.
[00:30:51.600]And what we're doing here is we are sending experts
[00:30:54.360]from Indonesian Oil Palm Research Institute
[00:30:56.730]who go to the field,
[00:30:58.290]they collect information about the soil type,
[00:31:00.790]the planting material,
[00:31:01.950]the management of that field.
[00:31:03.930]And eventually all this information is sent
[00:31:06.620]to our UNL data manager who compile information
[00:31:09.640]apply very rigorous quality control measures
[00:31:12.403]and try to link all this information in our database.
[00:31:16.280]As you can see, it's a quite complex
[00:31:18.030]big project that requires a lot of coordination
[00:31:21.630]and all that from Nebraska.
[00:31:24.310]All right, so let's take a helicopter view
[00:31:26.750]about some of the key social economic
[00:31:29.110]and agronomic practices associated with these smallholders.
[00:31:33.410]This is a quite rich table,
[00:31:35.230]so I will try to simplify it for you.
[00:31:38.520]And what you have here are the different provinces,
[00:31:42.330]so the six provinces are here in the columns
[00:31:45.500]and then on the right hand you can see
[00:31:48.630]the averages across provinces.
[00:31:51.070]So for the sake of simplicity,
[00:31:52.640]I will say that we focus here on this column
[00:31:56.360]that shows the averages across provinces.
[00:31:59.000]And then each rows corresponds
[00:32:00.530]to a different socioeconomic or agronomic variable
[00:32:03.930]that I pick because I thought that
[00:32:06.220]it was gonna be of your interest.
[00:32:08.420]We have measured many other variables,
[00:32:10.820]but here I just sample a few of them
[00:32:14.210]to give you an idea about the background
[00:32:16.680]of these smallholders.
[00:32:19.970]All right, So as you can see here from this information
[00:32:22.647]these farmers are managing on average two hectares of land,
[00:32:26.820]planted with oil palm.
[00:32:28.520]But although that sounds like a small area,
[00:32:31.380]those two hectares of oil palm account
[00:32:33.520]for 50% or more of their annual household income.
[00:32:40.870]So whatever we do here to increase the yield and the profit
[00:32:45.240]of those 200 of land,
[00:32:47.070]we have a tremendous impact
[00:32:48.760]of the livelihoods of the farmers and their families.
[00:32:53.330]Okay, another interesting thing is that
[00:32:55.880]these farmers have not grown oil palm for generations.
[00:33:00.990]This is not like a Nebraska soybean or corn grower
[00:33:05.880]who have two or three generations behind
[00:33:09.400]of a relative farming those crops.
[00:33:12.710]In this case we're talking about farmers
[00:33:14.410]who have grown oil palm for no more than 10 years,
[00:33:18.030]is their first generation of farmers growing oil palm.
[00:33:21.910]And in most of the cases
[00:33:23.390]these farmers have not gone into middle or high school,
[00:33:28.710]they just completed the elementary school.
[00:33:31.050]Which means that if we are gonna try to cut the farmers,
[00:33:34.290]we need to simplify complexity
[00:33:36.970]in translating into very simple technical messages
[00:33:40.800]that farmers can understand
[00:33:42.040]and eventually consider to implement on their fields.
[00:33:47.220]And what is about access to work input?
[00:33:50.590]This is more harder
[00:33:52.710]it seems to have reasonable access to inputs,
[00:33:56.320]considering that 60% of them reported that they can access
[00:34:01.620]and afford some key inputs,
[00:34:03.960]such as fertilizer and country research and so forth.
[00:34:06.430]So these are not like for smallholders in Africa
[00:34:09.700]that cannot purchase inputs.
[00:34:11.910]These farmers can afford inputs.
[00:34:14.710]But now the question is,
[00:34:15.980]what kind of inputs are they gonna purchase?
[00:34:18.970]Because when you,
[00:34:19.803]when we ask them about the source
[00:34:21.140]of technically information,
[00:34:23.170]more than three quarters of the farmer reported
[00:34:25.950]that the source of technical information
[00:34:28.050]is their own experience or the experience of their neighbors
[00:34:32.660]which have not grown oil palm
[00:34:34.756]for more than 10 years as them.
[00:34:37.061]So even though the farmers may have access to input,
[00:34:41.220]that doesn't mean that they're necessarily accessing
[00:34:43.750]the right inputs that they need
[00:34:45.310]to close a year gap for oil palm.
[00:34:49.150]And then when we go into the agronomic aspects,
[00:34:52.050]we found out many things that the farmers can do
[00:34:55.030]to improve their productivity.
[00:34:56.527]And many of them are not really related with inputs
[00:34:58.583]but rather to knowledge inputs,
[00:35:01.280]knowledge gaps.
[00:35:02.680]So we found that the engineer
[00:35:04.220]these farmers will follow suboptimal criteria for harvest,
[00:35:08.450]there is very severe with infestation on their fields.
[00:35:11.870]Most of them prune the Palm trees incorrectly.
[00:35:15.750]So there are many things here to improve
[00:35:17.490]that are not necessarily related with inputs
[00:35:20.970]in the sense of technologies,
[00:35:22.340]but more related with knowledge.
[00:35:25.990]So let's take now a look of the productivity data
[00:35:29.370]from these farmers.
[00:35:30.920]So this is a figure that I showed before
[00:35:33.490]which shows the yield potential here in blue,
[00:35:36.670]and it shows the attainable yield.
[00:35:39.160]So this is a FFB yield plotted against the palm age
[00:35:42.850]and this is where a farmer should be
[00:35:45.100]with good management practices.
[00:35:48.520]Now in the next slide,
[00:35:49.620]I'm gonna show the next slide
[00:35:51.500]but I'm gonna include the yield data
[00:35:54.020]from the 1,200 farmers that we're working with
[00:35:57.290]in this project.
[00:36:00.280]Here it is.
[00:36:01.500]So each of the points shown in this figure
[00:36:04.480]corresponds to one smallholder or palm field.
[00:36:08.143]You can see a lot of variation here,
[00:36:10.232]but you can see that in general
[00:36:11.823]most of these points are way below
[00:36:13.920]our attainable yield benchmark here.
[00:36:16.910]The attainable,
[00:36:17.743]the average attainable yield of this plantation
[00:36:19.750]is around 33 tons per hectare per year.
[00:36:22.550]That's where farmers should be with good agronomy,
[00:36:25.210]but in the real world the farmers are operating
[00:36:28.090]at only 14 tons per hectare, per year
[00:36:31.760]which is about 42% of that general year.
[00:36:34.890]So as you can see here,
[00:36:36.600]a huge a yield gap that they eventually can be
[00:36:39.890]exploited to increase the productivity and profit
[00:36:42.990]of these farmers, improve the livelihoods
[00:36:45.800]and eventually help Indonesia
[00:36:47.660]to produce more oil palm on existing plantation area.
[00:36:53.460]Now, there are two things I would like to highlight here.
[00:36:59.530]One is that if we look at the,
[00:37:01.610]if we compare the average yield
[00:37:05.070]of these smallholder fields for each age
[00:37:08.900]against our attainable yield curve shown here in green
[00:37:15.410]but you can see that these farmers are completely
[00:37:17.880]missing the productivity peaks
[00:37:20.400]that should happen around the seventh year or so
[00:37:25.460]which highlights the importance
[00:37:27.440]of good agronomic practices
[00:37:30.060]from very early on in the plantation cycle,
[00:37:33.420]even at the nursery.
[00:37:35.320]So these farmers are paying here
[00:37:36.880]probably for a bad management in the nursery
[00:37:39.420]where these palms were initially grown.
[00:37:42.610]Now, another interesting finding here
[00:37:47.190]was that even though on average
[00:37:49.350]these farmers are below the attainable yield,
[00:37:54.540]there are some farmers that are approaching
[00:37:57.110]that attainable yield
[00:37:58.870]while others are well below the attainable yield,
[00:38:02.940]which means that probably these farmers
[00:38:05.400]are doing something that these farmers are not doing
[00:38:09.170]which allow them to achieve higher productivity
[00:38:12.740]and get so close to these attainable yield curve.
[00:38:17.530]So our hypothesis here is that
[00:38:20.450]if we compare what's going on
[00:38:23.450]in these high yield fields in terms of management
[00:38:26.463]versus the management of the low yield fields
[00:38:30.000]then maybe we can learn
[00:38:32.040]what are the key management factors
[00:38:34.360]that are explaining yield gaps in this small fields
[00:38:38.520]and eventually use that information
[00:38:41.240]to develop interventions that can help the farmers
[00:38:44.840]to close the yield gaps.
[00:38:47.630]So what we did was,
[00:38:49.710]we took the population of farmers yields
[00:38:52.220]in each of these provinces
[00:38:53.800]and we compare the practices of this group of farmers
[00:38:57.510]against the practices of this other group of farmers.
[00:39:03.670]These metrics here shows the results
[00:39:06.110]from the analysis.
[00:39:07.570]Columns corresponds to provinces
[00:39:09.730]and rows corresponds to different management practices.
[00:39:13.230]So whenever you see a cell in green color in this matrix
[00:39:17.820]that means that we found the high yield fields
[00:39:21.870]to be different from the low yield fields
[00:39:24.190]for this practice.
[00:39:25.820]So if we take for example,
[00:39:27.580]if we take as an example
[00:39:28.820]this cell here for Riau,
[00:39:31.070]this green color is telling us
[00:39:32.970]that the harvest interval was different
[00:39:35.340]in the high yield fields
[00:39:36.460]compared with the low yield fields.
[00:39:39.040]This analysis is not perfect
[00:39:40.870]but they give us a first indication
[00:39:43.160]about what are the likely factors explaining
[00:39:45.320]the yield gaps in the smallholder farmers.
[00:39:47.857]And also it can tell you how consistent
[00:39:50.380]those yield limiting factors are among provinces.
[00:39:54.010]In some cases you can see that there is evidence
[00:39:56.090]that one factor explains yield gaps across all provinces
[00:39:58.720]as it is the case for harvest interval and for fertilizer.
[00:40:02.940]Well in other cases you can see that,
[00:40:04.890]that factor may explain yield gaps in some provinces
[00:40:07.350]but not in our province.
[00:40:09.380]But again this kind of analysis
[00:40:11.030]even though it's kind of course
[00:40:13.170]it gives us a starting point to start looking
[00:40:16.310]in more detail for the likely causes of yield gaps
[00:40:19.030]in smallholder farms.
[00:40:21.190]So let's go now into more detail about
[00:40:23.880]these possible yield limiting factors.
[00:40:27.530]This six chart here show the relationship between FFB yield
[00:40:33.010]on an annual basis and the average harvest interval.
[00:40:37.490]So basically 10 minutes that the farmer goes
[00:40:40.220]to the farmer to sorry,
[00:40:42.080]10 minutes that the farmer goes every day
[00:40:44.660]to that field to harvest,
[00:40:46.530]30 minutes that that farmers go
[00:40:48.100]to the field every month to harvest.
[00:40:51.030]And what we found, although there is a lot
[00:40:52.670]of scattering what we found is that there was
[00:40:55.147]a statistically significant negative correlation
[00:40:57.910]between the FFB yield with the average harvest interval
[00:41:02.000]which is explained by the fact
[00:41:03.430]that as the harvest interval increases
[00:41:07.610]the harvest losses also increases.
[00:41:11.610]So again, this is something that is not so much related
[00:41:14.550]with inputs rather than knowledge.
[00:41:17.040]This is,
[00:41:17.873]they will be something kind of very easy
[00:41:19.800]to implement by farmers
[00:41:21.420]to increase their productivity.
[00:41:24.840]All right, let's look at now
[00:41:26.570]into fertilizers because our previous analysis
[00:41:29.038]also indicate that fertilizers use
[00:41:32.920]maybe behind the yield gaps.
[00:41:36.586]This table here shows the external nutrient inputs
[00:41:40.850]as fertilizers or manure,
[00:41:43.170]the amount of nutrients are removed with FFB
[00:41:48.460]in the balance between the two things.
[00:41:51.270]And we compute these balances for three key nutrients
[00:41:54.650]nitrogen, phosphorous, and potassium
[00:41:57.620]and we did that for the six provinces.
[00:41:59.370]And on the right hand you have the averages
[00:42:02.670]across the six provinces.
[00:42:04.023]Again, for the sake of focusing on one column
[00:42:07.880]I would suggest that we all look here
[00:42:09.430]at the column on the right hand.
[00:42:12.710]In general what we found was that
[00:42:14.620]the nutrient input application
[00:42:17.110]with manure or fertilizer is quite low
[00:42:19.990]for so over one year they average,
[00:42:24.152]nitrogen input average 30 kilos,
[00:42:27.640]in the case of P and K seven and 19 kilos.
[00:42:31.500]Note that these amounts are expressed as element,
[00:42:34.580]as elementary nutrients.
[00:42:38.070]You can see that the removal
[00:42:39.625]in the case of nitrogen and potassium exceeds
[00:42:43.440]the amount of inputs
[00:42:45.430]which leads to negative nutrient balances
[00:42:47.820]for nitrogen and for potassium
[00:42:49.440]and for a neutral balance for phosphorus.
[00:42:53.220]One of the reasons why the potassium balance
[00:42:56.510]is so negative is because oil Palm
[00:43:00.790]has many oil seeds,
[00:43:02.820]extracts comparably more potassium
[00:43:08.260]than nitrogen and phosphorous
[00:43:10.800]which is very different from the typical cereal crops.
[00:43:15.110]So the combination of low nutrient inputs
[00:43:20.140]in high potassium in nitrogen extraction
[00:43:24.160]leads to these negative nutrient balances
[00:43:28.150]in the smallholder farms.
[00:43:30.000]Now, this is kind of interesting
[00:43:32.010]because these smallholders are achieving very low yields
[00:43:35.940]and on top of that they are mining their soil.
[00:43:38.910]So you can see that the situation is kind of very bad here
[00:43:42.140]because the productivity is low
[00:43:43.967]and on top of that
[00:43:45.400]these smallholders are mining the soil nutrients.
[00:43:50.390]And another reason for this nutrient
[00:43:53.980]for this negative nutrient balances,
[00:43:56.650]is related with the current
[00:44:00.121]fertilization subsidy program in Indonesia.
[00:44:03.920]These table are here shows
[00:44:07.007]the most common fertilizer sources used in Indonesia
[00:44:13.090]including Phonska, urea, MOP, and NPK.
[00:44:16.862]And the message here is
[00:44:17.695]that farmers are using subsidize fertilizer,
[00:44:20.500]which in most cases are poor in potassium and magnesium
[00:44:25.590]and they are rich in nitrogen and phosphorus.
[00:44:28.290]So in other words,
[00:44:29.850]farmers are applying fertilizer
[00:44:31.183]that is not suited for oil palm.
[00:44:34.307]And that's because the fertilizer program promotes
[00:44:37.720]the use of the wrong fertilizer for oil palm.
[00:44:40.580]So as you can see here,
[00:44:42.041]there's a clear opportunity
[00:44:43.050]to fine tune this fertilizer program
[00:44:45.890]to make sure that farmers will have access
[00:44:47.810]to the right type of fertilizer.
[00:44:50.040]I need to speed up here because I'm running out of time.
[00:44:52.450]But this narrative nutrient balance is consisted
[00:44:56.201]with our visual observations in the field.
[00:44:59.950]We have found all type of nutrient deficiencies,
[00:45:03.840]we have run nutrient tests
[00:45:05.380]and in our cases we have found that
[00:45:07.340]for example near 100% of the fields
[00:45:09.353]are deficient for potassium
[00:45:11.467]and near two thirds of the fields
[00:45:13.220]are deficient for nitrogen and for magnesium.
[00:45:16.470]And we are now conducting a on-farm trials
[00:45:19.920]where we are trying to help farmers
[00:45:21.780]to increase their productivity.
[00:45:23.660]We are doing that in a step,
[00:45:25.490]in a stepwise fashion
[00:45:27.450]where we are first trying to increase productivity
[00:45:32.990]by application of practices
[00:45:35.560]that don't involve higher costs.
[00:45:37.660]Like for example, improving the way farmers are harvesting
[00:45:41.110]and one farmers increase their productivity by harvesting,
[00:45:43.310]then we suggest them to implement.
[00:45:45.530]our practices are more costly,
[00:45:47.480]for example use of fertilizer.
[00:45:49.733]And eventually we hope that by following this pathway
[00:45:52.350]farmers we'll be able
[00:45:53.350]to increase their productivity and their profit,
[00:45:56.320]which is very important as we are talking
[00:45:58.765]about the smallholder farms.
[00:46:00.390]I'm gonna show you now the recite from the first year.
[00:46:03.910]This plot here shows the cumulative FFB yield
[00:46:07.827]since they start of the BMP plots.
[00:46:10.810]The red line corresponds to our BMP plots,
[00:46:13.250]the REF corresponds to the farmer managed plot.
[00:46:15.920]And you can see that over the course of one year,
[00:46:19.160]the productivity of the BMP plots
[00:46:20.780]is about two ton hectares,
[00:46:22.720]two times higher compared with the reference plot.
[00:46:25.970]And this was actually surprising
[00:46:27.580]because going back to a time lag
[00:46:30.190]that I was explaining before about
[00:46:31.990]yield formation in oil palm,
[00:46:33.930]the time it will take longer
[00:46:36.190]until we see the effect of fertilizer.
[00:46:38.160]So this is just the beginning
[00:46:39.837]of the positive impact of BMPs on yield.
[00:46:43.040]We will expect this yield benefit to increase
[00:46:46.190]as the oil palm it starts to capture
[00:46:49.667]the effect of the fertilizer application.
[00:46:52.286]But bottom line is that,
[00:46:53.130]it seems that there are a lot of opportunities
[00:46:55.410]to increase oil palm production in Indonesia
[00:46:58.350]by closing the yield gaps.
[00:46:59.980]The farmers are operating way below
[00:47:01.700]relative number of yield,
[00:47:03.260]there is evidence of very severe
[00:47:05.200]nutrient deficiencies and imbalances
[00:47:07.757]and the current fertilizer subsidy Parameters
[00:47:09.790]should be fine tuned to better address
[00:47:12.830]the needs of the smallholders.
[00:47:14.480]We are working with ministries in Indonesia
[00:47:17.620]to try to tune the current fertilizer program
[00:47:21.610]and clearly better agronomy is needed
[00:47:24.290]but it also needs more vigorous succession plans
[00:47:27.150]that can help us to address those knowledge gaps.
[00:47:29.850]A bottom line in trying to answer
[00:47:32.310]to the title of this seminar,
[00:47:34.150]it seems to us that intensification especially
[00:47:37.610]if complemented with appropriate policy and institutions
[00:47:41.429]has the potential to help Indonesia
[00:47:44.131]as well as other developing countries in the world
[00:47:46.600]to reconcile their economic and the environmental goals.
[00:47:54.920]Thank you very much
[00:47:55.940]and I guess we can now open for questions.
[00:48:00.400]Awesome, thanks Patricio.
[00:48:01.840]That was a great seminar.
[00:48:03.470]Mr. Patricio I'm just curious as to which,
[00:48:06.430]what models are you using to predict the yield gap?
[00:48:14.320]All right,
[00:48:15.610]we are using a Dutch model model called oil palm,
[00:48:18.300]no sorry palm scene.
[00:48:20.620]It's a model that has been available a few years ago.
[00:48:24.010]It simulates the whole plantation cycle,
[00:48:26.730]so we're talking about simulations that will simulate
[00:48:29.550]from year zero until year 25.
[00:48:32.300]And we have been,
[00:48:34.380]and we have spent a lot of effort trying
[00:48:36.020]to validate those models
[00:48:38.620]and for doing so we have collected yield data
[00:48:41.397]from experimental plots that were managed
[00:48:45.200]to minimize nutrient deficiencies
[00:48:48.639]and where people having going there
[00:48:51.910]almost every day to collect every single fruit.
[00:48:55.887]And we are quite comfortable with the model,
[00:48:59.940]it's not perfect simulating yield
[00:49:02.067]for perineal crops is challenging
[00:49:04.990]but overall our simulated values are consistent
[00:49:07.620]with what you will find
[00:49:09.430]in very well-managed experimental plots in Indonesia.
[00:49:14.420]Martha has a question.
[00:49:16.040]Okay, thank you John.
[00:49:17.840]Patricio thank you for a great seminar I appreciate it.
[00:49:21.750]So, in your survey you showed that 66%
[00:49:25.940]of the smallholder farmers can afford to buy fertilizer.
[00:49:30.910]Is that correct?
[00:49:33.360]So as a followup to that question
[00:49:37.150]to the small holder farmers,
[00:49:39.020]do they actually,
[00:49:40.470]one thing is they are able to purchase it,
[00:49:44.720]but do they actually purchase it?
[00:49:47.750]If not where,
[00:49:49.350]because where do they invest that money they have?
[00:49:52.120]So that statement is a little bit confusing to me.
[00:49:57.700]The survey shows that they are able to buy
[00:50:00.700]but do they actually purchase fertilizers?
[00:50:03.020]Is what I am asking.
[00:50:05.230]Yeah, yes, they purchase fertilizer
[00:50:07.280]but as I showed before,
[00:50:09.530]they will purchase then subsidized fertilizer
[00:50:12.240]which is not the appropriate one for oil Pam nutrition.
[00:50:15.960]So as you can see here,
[00:50:17.820]as you can see there
[00:50:18.653]there is a knowledge gap because even though
[00:50:21.140]they will buy and they will apply the fertilizer,
[00:50:23.810]they are applying a fertilizer that is no well Suited
[00:50:26.860]for oil palm nutrition.
[00:50:29.850]Which is kind of a huge opportunity cost for the country
[00:50:33.040]because they call country is spending money
[00:50:36.630]on subsidizing fertilizer for smallholders,
[00:50:39.390]but then the fertilizer that gets subsidized
[00:50:41.580]is not the one that they should be using.
[00:50:44.197]And one of the reasons for that is that
[00:50:46.550]most of the fertilizers brands comes from the 70s and 80s
[00:50:50.401]and were developed for rice or for maze
[00:50:52.920]not for oil palm and as I show my slide,
[00:50:56.260]the nutrient requirements for oil palm
[00:50:57.667]are very different from cereal crops.
[00:51:00.180]Oil palm has comparably higher nitrogen
[00:51:02.590]and potassium requirements compared with phosphorus.
[00:51:06.200]But it's not the case of cereal crops such as rice.
[00:51:11.360]Okay, so a followup question,
[00:51:15.171]since oil Palm is important,
[00:51:16.980]not just for Indonesia but as a export,
[00:51:20.320]given what you showed us in the products at the beginning,
[00:51:23.890]what is that,
[00:51:26.210]What is the role of countries that purchase these Palm oil
[00:51:32.070]in ensuring that there is a level
[00:51:36.280]Indonesia can invest a subsidized fertilizer
[00:51:39.030]but what's the role of people who purchase products
[00:51:41.620]that does have Palm oil that would be you and I
[00:51:44.517]and other countries?
[00:51:47.094]That's a very interesting question.
[00:51:49.140]You know Martha, when I started working on oil palm
[00:51:51.340]a colleague of mine told me "Patricio you're,
[00:51:53.796]"you will feel that it's gonna,
[00:51:56.013]"you will feel like swimming on hot water
[00:51:58.307]"because you will get hit from right
[00:52:00.637]"and from left."
[00:52:02.526]So there is a role to play
[00:52:06.430]from oil palm buyers in terms of asking Indonesia
[00:52:12.220]to produce oil palm in a sustainable way.
[00:52:15.840]The key thing there to understand is that
[00:52:19.410]while we are asking Indonesia to protect forest
[00:52:21.800]We also need to be sensitive
[00:52:24.051]to their economic aspirations.
[00:52:27.080]Indonesia is a developing country
[00:52:29.520]and oil palm is a major source of income.
[00:52:32.050]So for them producing more palm oil
[00:52:34.387]has a potential to bring millions
[00:52:36.670]of farmers out of the poverty.
[00:52:39.010]And I guess in answer to your question
[00:52:41.070]and also in relation to the picture
[00:52:43.980]that is shown in this slide,
[00:52:47.290]I think that we need a combination of both.
[00:52:50.107]So in this picture, you can see Maryanne
[00:52:52.220]who is the program officer from Norway
[00:52:55.120]at one time that she came to visit
[00:52:56.750]one of our experimental sites in Sumatra
[00:52:59.890]and all the women surrounding Maryanne are oil Palm farmers.
[00:53:04.550]And there was this conversation between Marianne
[00:53:06.670]and the farmer who was very interested.
[00:53:10.500]So on the one hand you have Maryanne
[00:53:12.360]who climate change and an environmental background
[00:53:16.879]and on another hand you have the farmer
[00:53:19.020]who is producing oil palm.
[00:53:20.650]And Maryanne asked the farmer,
[00:53:22.397]"Why are you producing oil palm?"
[00:53:24.771]And the farmers simply respond,
[00:53:27.517]"Well thanks to oil palm I can send
[00:53:32.327]"my second daughter to school."
[00:53:34.920]So I think that it needs discussion
[00:53:37.550]about what the role of oil palm buyers
[00:53:42.087]in asking Indonesia to do certain things.
[00:53:46.210]I think that we should all keep on mind
[00:53:48.850]that it's very important to protect the environment.
[00:53:51.450]We all want that,
[00:53:52.586]but we need to do so in a way
[00:53:55.370]in which we are also sensitive
[00:53:57.100]to the economic goals of these countries
[00:53:59.910]and the economic aspirations of these millions of farmers.
[00:54:03.490]So that's my answer to your question.
[00:54:05.100]Yeah, thank you I appreciate that.
[00:54:08.000]Thanks, Martha.
[00:54:08.833]Jim asked a question in there.
[00:54:11.980]You want me to read it?
[00:54:12.813]Yeah, do you think you can read it for me?
[00:54:14.010]Sorry John.
[00:54:14.843]He says that,
[00:54:16.300]Palm oil yield peaks at seven years
[00:54:19.310]then gradually declines from then to about 25 years.
[00:54:23.190]Given the short term experience of less than 12 years
[00:54:26.310]what is the fraction of a given
[00:54:28.020]two hectare farm in that context?
[00:54:30.740]And how was that taken
[00:54:32.180]into account in surveying the optimum harvest interval?
[00:54:36.674]Jim maybe you mean where I play for?
[00:54:40.470]Yeah, I think in running your slides.
[00:54:42.810]You showed that the timing
[00:54:45.340]could be two to three times a month
[00:54:50.500]was it that thing?
[00:54:51.971]If you go to that slide you probably you,
[00:54:54.381]where you're talking to him about it
[00:54:56.020]and also about the experience of the producers
[00:55:00.450]in growing palm (indistinct) less than 12 years right?
[00:55:03.876]So I was just curious in the context
[00:55:08.950]of your 25 year chart there
[00:55:12.669]and producers having only 16 or less than 16 years
[00:55:17.410]where were most of America fraction or they're farmers
[00:55:20.310]of various phrases of those years in each of the districts?
[00:55:25.690]All right, all right I got you there.
[00:55:28.020]So first of all, these farmers
[00:55:29.450]manage only one field in general
[00:55:32.208]and most of these farmers,
[00:55:34.340]so basically the field that correspond here is one farmer
[00:55:38.960]and in the palm age will be equivalent
[00:55:43.490]to the experience of a farmer growing oil palm.
[00:55:46.250]So for example,
[00:55:47.690]if you look at this point here
[00:55:49.406]this point a farmer who grow,
[00:55:51.890]who has a total of five years of experience
[00:55:54.630]of growing oil palm.
[00:55:55.570]So this is the only field that this farmer has managed.
[00:55:59.890]He planted oil too well
[00:56:01.750]and he has been growing oil palm for only five years.
[00:56:04.237]And that's the first time in his life
[00:56:06.100]he grew oil palm.
[00:56:08.170]Okay, so that,
[00:56:09.660]so each point there,
[00:56:10.920]each data point is representative of a farmer.
[00:56:14.300]If I take the top most data point out there next
[00:56:17.603]to the yield attainable,
[00:56:19.931]that person would have a two acre field
[00:56:23.060]that's no looks like eighth year or something like that?
[00:56:27.860]Yeah, right, right, right.
[00:56:29.180]Okay, that makes more sense.
[00:56:31.432]So you can see that there are farmers
[00:56:33.410]who have planted oil Palm only five years ago
[00:56:37.470]for first time.
[00:56:38.303]So they have very little experience
[00:56:40.447]and other farmers have planted that plantation 22 years ago
[00:56:44.440]and they have more plantation, more experience.
[00:56:47.540]But in all cases this is the first generation
[00:56:49.470]of oil palm farmers.
[00:56:51.681]So if I look at that chart
[00:56:53.570]just a quick followup here,
[00:56:55.900]the ones that are five years have just planted
[00:56:59.913]their two hectare fields.
[00:57:01.600]Is that right?
[00:57:02.433]Or, I mean, I have recently planted
[00:57:04.140]within the last five years
[00:57:05.560]as opposed to somebody way off to the right.
[00:57:08.480]In fact, you got a point there on 25 years
[00:57:11.120]it must've been around a long time.
[00:57:13.242]So that's a pretty good spread coming
[00:57:17.220]about for the entire data set, which is good.
[00:57:19.820]Thanks for the presentation.
[00:57:21.370]Yeah it also helped me
[00:57:22.320]to explain something else.
[00:57:24.800]That's the importance of having this productivity curve here
[00:57:29.560]because you can see that the potential changes with the age.
[00:57:33.000]So when calculating the yield gap
[00:57:35.160]we need to calculate the yield gap for each
[00:57:37.190]considering the age of the plantation
[00:57:39.450]because you cannot calculate the yield gap for this farmer
[00:57:42.160]using the attainable yield in order to corresponds
[00:57:44.911]to a plantation of 20 years.
[00:57:49.530]So it is kind of interesting
[00:57:50.969]almost like a boundary function there,
[00:57:53.080]like you showed in Nebraska and corn and soybean yield
[00:57:57.060]where you have a boundary function for efficiency.
[00:58:02.163]Yeah, the only difference is that in Nebraska,
[00:58:05.280]most of the dots will be very close
[00:58:07.460]to a boundary in this case.
[00:58:09.721]Okay, good point.
[00:58:12.300]We do have another question
[00:58:13.610]from Eris, Aaron and Alison.
[00:58:15.810]All right.
[00:58:16.643]So how are botanists (Mumbles)?
[00:58:20.942]How do you believe first world
[00:58:22.220]countries will have to elevate this issue?
[00:58:25.040]So I get that.
[00:58:25.873]We have two, two questions here.
[00:58:28.430]I think that I answered the second question already.
[00:58:31.020]So I'm gonna try to answer the first one here.
[00:58:34.170]So oil palm is originally from Africa.
[00:58:38.140]It was first introduced
[00:58:39.590]to Indonesia in the early 19th century.
[00:58:42.600]And you have basically,
[00:58:44.412]and oil palm loves the tropical environment.
[00:58:52.050]And you basically have,
[00:58:54.080]there's a planting material having a slide here.
[00:58:59.670]You have basically the,
[00:59:02.215]what plantations will plant is a hybrid
[00:59:06.980]that come from a parent and is called Dura
[00:59:11.354]in another parent that is pisifera.
[00:59:14.420]So what you see on the plantations
[00:59:16.690]are almost all F1 hybrids.
[00:59:21.384]Now, in some cases the smallholders
[00:59:23.330]will go to commercial plantations
[00:59:25.320]and grab loose fruits and they will plant them
[00:59:27.870]on their own fields.
[00:59:29.210]And because they are planting the F1,
[00:59:31.830]then they will get all sorts of things.
[00:59:33.890]They will get 25 Dura, 25 Pisifera and 50% tenera.
[00:59:38.560]And the pony is that when you grow the F1
[00:59:41.910]then you will get 25% of the plants are Pisifera
[00:59:44.560]which means that they don't produce anything.
[00:59:47.180]And that's a major issue also explaining yield gaps
[00:59:50.210]that I explained today,
[00:59:52.190]but making sure that farmers use certified material,
[00:59:56.400]planting material rather than going out there
[00:59:59.160]to pick loose fruit from oil plantations
[01:00:01.600]is also very important when it talking
[01:00:03.590]about yield gaps in smallholder farms.
[01:00:06.040]But in extend to your question,
[01:00:08.060]oil palms come from Africa.
[01:00:09.170]It was introduced to Indonesia
[01:00:11.140]and what you see planted nowadays corresponds
[01:00:13.840]to a cross between a Pisifera and Dura
[01:00:16.900]which is called Tenera.
[01:00:19.666]Yeah, in my own way something that is very interesting
[01:00:22.130]about this hybrid is that when you compare the hybrid
[01:00:27.660]versus the dura parent,
[01:00:30.033]the FFB yield is not too different.
[01:00:32.400]So the productivity is not too different
[01:00:34.117]but what is different is the whole all concentration.
[01:00:38.302]The hybrid produce around 25 per hectare
[01:00:42.452]an oil extraction rate of around 25%
[01:00:44.840]while Dura has 70%.
[01:00:47.570]And so when a smallholders go
[01:00:49.720]and they pick the fruits,
[01:00:51.700]they have two problems.
[01:00:53.020]First of all is that they're not gonna get any yield
[01:00:56.070]from 25% of the F1 population.
[01:00:58.930]And from the other 75%
[01:01:00.862]and then they will get lower yield
[01:01:03.290]from the other 25% of the population that is Dura.
[01:01:08.070]So as you can see many problems going on there.
[01:01:10.380]Bottom line is that Indonesia is making a big investment,
[01:01:14.580]trying to promote that the smallholders
[01:01:17.060]use certified planting material
[01:01:19.240]but that takes time because we are thinking here,
[01:01:21.380]we are talking here about a 25 year plantation cycle.
[01:01:26.070]So even if you start now
[01:01:27.940]to promote certified planting material
[01:01:30.890]it's gonna take 25 years
[01:01:32.267]until you have all the smallholders
[01:01:35.390]to switch from the non-certified to a certified material.
[01:01:39.616]Patricio is a fertilizer management regionally-based?
[01:01:47.020]Does it exist in Indonesia?
[01:01:49.410]You've got,
[01:01:50.243]you had Sumatra and Kalimantan.
[01:01:54.310]So how,
[01:01:55.143]what is the current agronomic program
[01:01:57.330]with respect to fertilizer management,
[01:01:59.370]if it exists?
[01:02:01.260]Well for large plantations it's quite good.
[01:02:04.430]So my answer is gonna now focus on a smallholders.
[01:02:07.879]When you go to Java,
[01:02:08.959]I mean to the Island of Jambi
[01:02:11.368]and you visit with rice or maize farmers,
[01:02:14.690]you can really tell that these farmers
[01:02:16.120]know what they are doing
[01:02:17.070]and they have access to extension services.
[01:02:19.720]So they all understand pretty well
[01:02:22.130]how much NPK they need to apply
[01:02:25.810]and if they don't know something
[01:02:26.830]they can always check with our local extension agent.
[01:02:29.720]Now, when you look at oil palm in smallholders,
[01:02:33.400]there is nothing like an extension service for them.
[01:02:36.790]And one of the reasons is
[01:02:38.260]because the Indonesian government
[01:02:41.020]has not listed oil palm as a priority crop
[01:02:46.760]thinking that somehow the private sector
[01:02:49.830]the oil palm private sector
[01:02:51.400]was gonna take care of the smallholders.
[01:02:53.730]But in the real world that doesn't happen there.
[01:02:56.550]The large plantations benefit from the smallholders
[01:02:58.640]because the smallholders will sell their FFB
[01:03:02.200]to their mills,
[01:03:03.090]but that doesn't mean that the private sector
[01:03:05.440]is gonna put together an extension service
[01:03:07.780]to help address the needs of the smallholders.
[01:03:11.910]So bottom line is that the smallholders oil palm farmers
[01:03:15.920]are left there without access
[01:03:17.980]to any reasonable extension services.
[01:03:21.110]And I cannot tell you Martha
[01:03:22.500]how many times I have talked with these farmers
[01:03:25.090]and they have told me how they feel abandoned
[01:03:29.910]and in many cases telling me,
[01:03:32.167]"Hey, you know we chop 30 hectares of Frank forest,
[01:03:35.517]"just because we know how to increase the productivity
[01:03:38.257]"in our plantation."
[01:03:40.191]So again it's not only about giving the farmers more input,
[01:03:45.180]but also empower them with better knowledge.
[01:03:50.801]Well it's about how to use those inputs.
[01:03:54.057]And there is nothing like a local nutrient recommendation,
[01:03:58.030]that doesn't exist.
[01:04:01.231]Than you.
[01:04:02.610]And that's why I didn't have time
[01:04:06.250]but we are doing a lot in terms of trying to change that.
[01:04:10.787]And we are following two approaches.
[01:04:12.770]One is bottom up, working with ministries,
[01:04:16.330]with farmers agencies in emulsifying
[01:04:20.470]the fertilizer subsidies and extension programs.
[01:04:23.510]But we're also trying to promote
[01:04:26.110]this farmer to farmer learning.
[01:04:29.100]And we are developing all these technical flyers here,
[01:04:34.000]this pocket guide,
[01:04:35.760]we have had many filets
[01:04:38.690]and you can tell how hungry these farmers are
[01:04:42.760]for technical information.
[01:04:44.520]So the opportunity is there
[01:04:46.303]to put together an extension service that can help
[01:04:49.330]to address the technical needs of these farmers.
[01:04:51.770]Thank you, Patricio,
[01:04:52.820]I appreciate it and very nice seminar.

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Oil Palm Production and Conservation of Natural Resources: Can We Get It All?

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