SINGAPORE: The majority of forest fires in Southeast Asia occur in states which produce oil palm, according to Global Forest Watch. Forests are cleared to make way for oil palm plantations. To save on clearing costs, farmers resort to burning.
While frameworks to stop haze are being established at the regional level as well as in countries like Indonesia and Malaysia, the challenge remains to get on board the actors who presently benefit from drained peatlands - the farmers, companies and investors profiting from oil palm. Could a long-term solution to preventing forest fires in the region lie in promoting alternative commodities that can grow in wet peatlands?
DRY PEATLANDS THE ROOT CAUSES OF PEAT FIRES
The sine qua non, or the condition without which fires can start and spread, is the presence of dry peatlands. Peatlands are naturally wet swamps of decomposed matter. They are nutrient-rich, but extremely flammable when dry.
Yet, farmers resort to draining these swamps because oil palm can only grow in dry soil.
The initiative of restoring peatlands to their naturally wet state has been emphasised by Indonesia. However, unless the practice of draining peatlands is addressed, haze will continue to be a challenge.
At the root of the issue, is the choice of oil palm as the dominant crop. This happens for two key reasons.
First, oil palm is highly profitable and offers higher wages than other crops. The World Agroforestry Centre reports that oil palm in Indonesia yields profits of up to IDR44 million to IDR295 million (S$4,600 to S$30,760) per hectare per annum and wages in oil palm are two to seven times greater than average agricultural wages in the country.
The other reason is the short lead time in growing oil palm, which takes three to four years before bearing fruit, with some gestation period before harvesting. This short lead time reduces the risks to investors who wish to invest in oil palm, in comparison to plants such as sago, which takes 10 to 15 years to grow before they can be harvested.
SEARCH FOR ALTERNATIVE CROPS
To prevent farmers and private companies from draining peatlands, it must be economically sustainable to keep these peatlands wet. Alternative commodities that can be grown in peatlands while meeting three key conditions need to be leveraged.
First, they must be able to grow in natural wet peat conditions.
Second, they must be able to compete with oil palm in profitability, to translate into equivalent or higher wages to farmers and returns to investors.
Third, they must be able to reduce investor risk by having shorter lead-time periods before harvest.
The Food and Agriculture Organisation (FAO) of the United Nations has already identified commodities that can grow in naturally wet peat conditions. These include sago, papyrus, wild rice, wetland taro, water celery, water spinach and Chinese water chestnut.
Apart from these, there are also plants that can grow in moderately drained peatlands, such as rice, bananas, beans, carrots, celery, corn, lettuce, mint, onions, potatoes, parsley, radish, pasture-sod, sugar cane, chilli, soya bean, tobacco and a few horticultural crops.
The challenge, however, is that there is limited information on which of these commodities meet the second and third conditions of comparable profitability and time taken before investors start getting net positive returns on their investments. Among the limited studies available, one shows that if sago was chosen as alternative crop to explore, it takes sago 10 to 15 years before it can start bearing fruit. Its internal rate of return is up to 8.06 per cent, still low compared to 20 per cent if oil palm was planted.
Alternatively, some crops can be grown in less than a year, like radish or celery, but it is not known if there will be sufficient demand for these. Additional preparations may also be needed, including undertakings to reduce the acidity of the soil, prevent pests and diseases, or increase the value-add of producers through additional processing.
ALTERNATIVE CROPS MAY HOLD THE KEY
There is a need for more research and institutional support in improving the desirability of producing alternative commodities, on both the demand and supply sides. These need to be considered in developing and implementing long-term rehabilitation plans.
Demand-side interventions include research to identify alternative commodities that are in demand, who the buyers are, what qualities and traits they desire and what prices they are sold at.
Buyers may include domestic buyers within Indonesia and Malaysia, as well as importers from higher income countries. In Japan, for instance, youths are leaving the agricultural sector, creating opportunities for countries like Indonesia to provide select crops.
Supply-side interventions require identifying technologies that can help meet buyer requirements, while at the same time be cost effective to producers. Research will be needed in boosting yields in producing commodities, such as through increasing crop resistance to submergence or flooding, pests and diseases.
For instance, if heavy research led to growth in the productivity of cassava production, from just six tonnes per hectare to up to 30 tonnes per hectare, can this not be done in the case of the crops identified by FAO?
Along with boosting yields, it will also be important to hasten the time before crops can be harvested. Research at the National Institute of Education, Singapore, for instance, shows that certain planting systems and growing environments can shorten grow-out periods.
Agricultural transformation will have an important part to play in addressing haze, but this requires farmers, businesses, investors, academia, and governments to play their parts.
Jose Montesclaros is Associate Research Fellow at the Centre for Non-Traditional Security Studies at the S. Rajaratnam School of International Studies at the Nanyang Technological University in Singapore. This commentary first appeared in RSIS Commentary. Read the original commentary here.