November 19, 2018

Peat domes to sugarcane -- major supply chains linked

( - A sugarcane plantation complex incorporating extensive peat protection zones (peat domes) lying in one of Indonesia’s peat restoration priority regencies has been under continuous development by a joint venture company belonging to three conglomerates. 

The company in question, PT Pratama Nusantara Sakti (PNS), is controlled by the Djarum Group, Wings Group and Central Proteina Prima.

This sugarcane concession, which was granted a permit in August 2011 for an area equivalent to almost 30 thousand soccer fields, is located in Ogan Komering Ilir (OKI) in South Sumatra, one of the worst affected regencies in 2015’s peat fires.

Parts of peat protection zones scattered over almost 35% of the concession, which were legally designated as such by Indonesian Environment and Forestry Minister Siti Nurbaya in late February last year, continue to be replaced with sugarcane plantations.

The following Planet Explorer images, analyzed by the  spatial team, portray the ongoing sugarcane plantation development in parts of the peat protection zones. 

The Indonesian Peat Restoration Agency (BRG) has also classified an area equivalent to more than 13 thousand football fields in the sugarcane concession as peat domes to be prioritized for restoration, as shown in the agency’s map posted on its website, as seen below.

Nonetheless, major sections of these peat domes, which are situated within the boundaries of the peat protection zones, have also been converted into sugarcane plantations. 

In late July 2017, President Joko Widodo warned that the mutual prioritization of protection and recovery peat domes is crucial, among other things requiring companies obliged to get involved, in order to prevent the recurrence of catastrophic peat fires that are extremely difficult to extinguish. 

Numerous supply chain links

Singapore-based pulp and paper giant APRIL’s sourcing of some of its acacia fiber from the Djarum group leads to its supply chain being definitively linked to the ongoing sugarcane development in the peat protection zones concerned.

In addition, it turns out that the supply chains of various powerful global food & beverage companies are also associated with this continuing conversion of peat protection zones into sugarcane plantations, as depicted by the Planet Explorer images below. 

NestléCargill, MarsBungeADM and Louis Dreyfus, RSPO and TFT members alike, all continue to fill their tanks with palm oil from Djarum’s palm oil mill. 

Another two companies, Unilever and PepsiCo, which are RSPO members but not TFT members, are similarly enjoying palm oil sourced from the Djarum group. 

The aforementioned companies should be demonstrating greater concern about disengaging their supply chains from suppliers, such as the company in this case, which are disrespecting peat protection zones. 

Even though sugarcane is considered to be a crop vital to Indonesia’s national development by the government, the relentless conversion of peat protection zones into sugarcane plantations should be legally disallowed.