ABSTRACT

Brazil has the largest climatically suitable area for Oil Palm cultivation in the world with more than 31 million hectares. It also has strategic logistics location. The port of Belem, in the north of Brazil and the main export port for palm oil is within a 6 days trip to New Orleans in the United States and 14 days to Rotterdam, in the Netherlands. Nevertheless, this remains a marginal culture in the country with only 162 000 hectares planted, most of them in the past 8 years, where growth was approximately 9% per year. Below we mention some of the barriers that lately discourage investment in this culture locally:

• Rigid environmental laws requiring statutory forest reserve of 50% out of the total area.
• Need for maintenance of riparian forests in all watercourses, ranging from 5 to 100 meters depending on the width of each watercourse.
• Difficulties in land records and registration with the local authorities.
• Prohibition on land purchase by foreigners since August 2009.
• Rigid labor laws that make Brazil the highest labor cost place among the 44 countries growers of oil palm in the world, reaching US$ 14,000 per harvester per year.

All these difficulties have forced local growers to invest heavily in mechanization and worker training, as well as replanting with higher yields varieties to local climatic conditions, with the introduction of seeds from Colombia, Ecuador, Costa Rica, Brazil and Thailand. Some companies are already experiencing yield of 30 tons of bunches per hectare, which shows that the right decisions were made at these leading companies. Due to investments in mechanization, some producers have managed to increase the productivity of each farm worker from 8 to 11.5 hectares, a gain of 43.8% in the past 10 years.

One of the prominent palm oil companies in Brazil is Agropalma. A midsize company with 40,000 hectares of their own plantations and 10,000 hectares in partnership with smallholders. All plantations are RSPO certified (smallholders were audited last July and recommended for certification by the certification body, now we are awaiting the completion of the process by RSPO). It will be the first group of smallholders certified by RSPO in Latin America. In this month of August, we are also been audit against POIG (Palm Oil Innovation Group) indicators, that still is in the experimental stage and is not yet a certification.

Agropalma has a unique model in the world, which holds 1.6 hectares of FORESTS for every 1 hectare of oil palm. It was the first Oil Palm grower worldwide to issue a public commitment to Zero Deforestation in 2001, away before any of the current global sustainability initiatives in this sector. Was also elected by the NGO Greenpeace in its Palm Oil Scorecard 2012 the most sustainable Oil Palm grower in the world, and of course we continue working hard to maintain that position, such as in the report to be published in early September that shows Agropalma through its sustainability initiatives captures 1.5 ton. CO ₂ E / ton. of CPO, and it still without the facilities to capture methane from the effluents, which should only be ready in all six extraction mills in the next 8 years due its cost, so this highly positive number in terms of GHG will further improve.

During my presentation, graphics and photos will show the actions mentioned here and others in the social, technical and environmental aspects. In a general summary, I would say that Brazil will never be a major producer of palm oil, in my view we are able to be a medium-sized producer, but it sure will be the last frontier for large-scale investments in this sector, because there are still ahead of Brazil areas in Indonesia, Africa and some countries in Latin America and Asia Pacific providing an overall lower cost of production.