Progress! Indonesia To Destroy Only 50,000 Ha/Yr Rain Forest Instead Of 100K If Norway Deal Holds

[hatrack]

Yay.

Indonesia (Reuters) - Indonesia's annual oil palm expansion may halve to 50,000 hectares from 2009 levels once a $1 billion climate change deal with Norway comes into effect next year, a top industry official said on Monday. Following a financing deal signed with Norway last week, the Southeast Asian country plans to revoke existing forestry licenses held by palm oil and timber firms to save its vast rainforests and peat lands that are seen as a carbon sink.

The government has promised land swaps for cancelling some forest concessions, a process that may take years to fine tune and also prevent the world's No. 1 palm oil producer from achieving its 40 million output target by 2020.

"That target would be achievable if oil palm estates expanded at a rate of 200,000-300,000 hectares a year but not with this. We will need to boost productivity," Derom Bangun, vice-chairman of the Indonesian Palm Oil Board (IPOB) told Reuters in an interview.

Expansion in Indonesia hit 300,000 to 400,000 hectares at the height of the commodity boom in 2007 and 2008 but has fallen back due to pressure from green groups and the financial crisis that had stymied investment into the sector. This year top planters like Singapore listed Wilmar and Sime Darby are gearing up to expand and plant in new concessions across Indonesia as land prices soften from record $15,000-$20,000 a hectare in 2008, analysts say.

EDIT

http://www.reuters.com/article/idUSTRE64U30720100531