Colombia’s palm oil producers have called on the country’s government to protect the sector’s profitability against the rising local currency, and continuing environmental and ethical concerns surrounding the industry’s practice, national media reported on Tuesday.
The director of the country’s Oil Palm Growers Federation (Fedepalma) made the call from the Federation’s 48th National Congress in the western city of Cali, pointing to the adverse effects of the rising Colombian peso. The currency hit a 6-month high in May, making the local product appear increasingly expensive to foreign buyers.
Speaking from Cali on Tuesday, President of Fedepalma, Jens Mesa Dishington, stated that “the appreciation of the exchange rate has harmed our country’s competitiveness in a number of sectors,” Colombia’s Caracol Radio reported.
“Given current exchange rate, there is little potential for creating productive employment,” added Mesa Dishington.
Colombia’s palm oil industry — the fifth largest in the world — has also been challenged by ongoing environmental concerns regarding mass deforestation, and its alleged links to paramilitary groups during the country’s longstanding armed conflict.
Nonetheless, it looks likely that Colombia’s central bank, Banco de la Republica, will act to weaken the peso-dollar exchange rate, buying up to the $1 billion limit for the April to June period of 2014, reported international news-wire Reuters.
During the Congress, where palm oil producers convene to discuss agricultural policy, growers also identified the lack of infrastructure and the threat of guerrilla attacks as bottlenecks to the sector’s advancement.
The alleged failure of security in the countryside has given rise to frequent attacks perpetrated by a number of rebel groups, including the Revolutionary Armed Forces of Colombia (FARC), which threaten the work of local communities to grow the palm trees, reported Caracol Radio.
Sustaining the world’s fastest-growing palm oil producer
Colombia is the biggest palm oil producer in the Americas and the fastest-growing in the world, according to global data publisher, Oxford Business Group. The industry which, as of 2010, covered nearly 1,000 acres of agricultural land in Colombia, provided over 130,000 local jobs and is a lucrative export for the Colombian economy.
Greenpeace campaign co-ordinator Hernan Giardini told Colombia Reports that the government needs to consider the structure of Colombia’s agriculture and livestock industry before promoting the production of palm oil in the country.
“Colombia has a tradition of small-scale farming, whereas palm oil is generally produced by larger corporations.” he said, adding that the effects of deforestation in the country could be damaging to the nation’s farmers.
Production in the sector, which according to El Pais newspaper covers 10% of Colombia’s cultivated land, is dominated by multinational corporations, many of whom are represented by Fedepalma.
Adding to Greenpeace’s concerns, the country continues to struggle with mass deforestation caused by illegal and legal practices, including mining and the palm oil sector. According to UN data obtained by the Oxford Business Group, Colombia currently loses nearly 495,000 acres annually to deforestation.
Although these factors throw the sustainability and just practice of the palm oil sector into question, it continues to thrive from global demand. If its astonishing rate of growth persists, Colombia’s palm oil sector is set to enter 2020 at six times its size today.
Human rights violations
The growing of palm oil in Colombia has been heavily linked with exacerbating the nation’s civil conflict, according to international NGO Human Rights Watch. Palm oil companies are only one of a number of large-scale industries that have purchased expansive tracts of stolen land from actors in the armed conflict.
Right-wing paramilitaries, who have been linked to the displacement of thousands of farmers across the country, have reportedly used proxies to develop palm oil projects on land stolen from small farmers.
Profits from palm oil companies have also been traced to former paramilitary factions, including jailed Colombian paramilitary leader Carlos Mario Jimenez, alias “Macaco,” stated Human Rights Watch.
In the northern state of Bolivar in particular, human rights groups recorded extensive collaboration between palm oil companies and paramilitary groups during the early 2000s.
- Interview with Hernan Giardini, Forests Campaign Coordinator for Greenpeace Argentina (Colombia Reports)
- Se apunta al crecimiento de la palma en Colombia (Oxford Business Group)
- UPDATE 2-Colombia central bank raises interest rate 25 basis points (Reuters)
- “Hay que repensar la manera de hacer agricultura”: Presidente de Fedepalma (El Pais)
- Productores de palma piden a Gobierno colombiano cambios en política agrícola (Caracol Radio)
- Deadly Aid (Human Rights Watch)