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4.3.1.2 Oil Palm The area of land occupied by oil palm plantations in ndonesia has increased
fold since to occupy an estimated . million ha in
. Most of this expansion has occurred in the six provinces of Riau, South Sumatra, North
Sumatra, West Kalimantan, Jambi and Central Kalimantan. The prolific growth of the oil palm sector has conferred important economic
benefits: palm oil has become a valuable source of foreign exchange, revenue and employment. A hectare of oil palm in ndonesia produces a Net Present Value over
years of between , ,
depending on location. Peat soils produce higher yields per hectare than plantations on mineral soils and result in a Net
Present Value of , per hectare .
Oil palm expansion has occurred at the expense of ndonesia s natural forest cover and has been implicated in the causes of wildfires and peatland degradation. All
of these land use changes have resulted in carbon emissions. More data needs to be collected from provinces in which oil palm is concentrated before a more
accurate picture of the impact on deforestation, peatland degradation and carbon emissions can be determined.
4.3.2 Unplanned forest losses
4.3.2.1 Protected areas Several studies have attempted to untangle the causes of forest loss within protected
areas in ndonesia, mostly focused on conservation forests, and have concluded that multiple factors are involved. llegal logging and encroachment are the most
important and widespread proximate causes, but it is not possible to attribute a specific proportion of the deforestation to them. The factors that combine to
allow for illegal logging and encroachment are a lack of enforcement, insufficient incentives for communities and governments for maintaining protected areas, and
low capacity of institutions charged with managing the protected areas. 4.3.2.2 Natural Production Forests
There are two principal drivers of deforestation and degradation from timber harvesting in the production forests:
. Unsustainable levels of extraction from legally permitted forest concessions . llegal logging at small and large scales
. There are, in addition, two issues of land use that contribute to deforestation and degradation:
. planned conversion of native forest zoned as PK; and . the impact of spontaneous encroachment of production forest by neighbouring
communities who may or may not be aware of the boundaries.
]
Bisinfocus
]
The Net Present Value of oil palm considered a range of costs associated with oil palm establishment, including land clearing, building roads and drainage, land preparation and planting. t also considered the average yield of
Fresh Fruit Bunches FFB over a year period thayr and the price of FFB in
Rp ,
per kg .
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Currently, P concessionaires are not held accountable for unsustainable logging practices or failure to prevent loss by other actors. The short length of
concession agreements also decreases their interest in pursuing sustainable forest management practices such as Reduced Impact Logging RL .
n addition, significant areas of production forest are not under concessions, but exist as open access land. Approximately million hectares of the production
forest is not currently managed by concessions, and roughly of it has high levels of forest cover. Loss of forest cover on this land has been high in the past,
and will continue to be unless it is brought under effective management. At the present time the demand for logs exceeds sustainable supply from legal
P concessions by million cu . per annum. Modeling suggests that this may only be reduced to million through the projection period.
This shortfall is driving demand for mixed tropical hardwoods from T concessions and PK conversions and is also the major factor behind illegal
logging for international as well as domestic markets. The extent of the problem appears to have been reduced from million m per annum in the early part of
the decade to about million m presently. Forestry policy opposes further conversion of PK for plantation crops over and
above the agreed areas under the Padu Serasi. This policy is based on the authority of a Ministerial Decree ..
A critical factor in predicting forest cover outcomes in production forests is the extent to which local communities are utilizing forest land for livelihood, as well
as participating in illegal activities for or with other actors. The number of people dwelling in or near forests is estimated to be in the order of - million. Many
are poor, with little land and few options for maintaining livelihood. Even if the major drivers of production forest loss were eliminated, degradation
and deforestation from the informal and largely undocumented activities of the many people dependent on these forests would continue.
4.4 Resolving land issues between central and local governments
