IDAT Risk

Earthsights’ investigation reveals wood used in America’s  recreational vehicles (RVs) can be traced to the devastation of Borneo’s rainforests. The RV industry is the largest consumer of tropical wood in the United States, using an average of 500 giant trees every day.

Just three corporations make 86 per cent of the RVs sold in America. Earthsight and Auriga found plywood from deforestation in Indonesia in the supply chains of all three.  This includes the US’s best-selling RV brand, Jayco, whose wood supplies are linked to a project clearing three football pitches of orangutan habitat every day.

These findings contradict RV companies’ declared commitments to nature and sustainability.

The Indonesian government has halted illegal gold mining operations and seized two excavators from a limited production forest in Bolano Lambunu sub-district, Parigi Moutong district, Central Sulawesi.

“This enforcement action was our swift response to public reports on unlicensed gold mining using heavy excavators that damaged forest areas in Central Sulawesi,” Ali Bahri, head of the Sulawesi Forestry Law Enforcement Office, said on Thursday.

The suspect faces a maximum prison sentence of 15 years and a fine of up to Rp10 billion (over US$618,000).

Building materials could become much more expensive under a US and EU-led plan, which would see timber used in flooring, plywood, decking, and furniture added to the species protected by CITES. The wood in question is Keruing—one of hardwood’s best-kept secrets—with the tropical species (native to Indonesia and Malaysia) sold extensively in Australia’s building merchant network.

Common uses include internal flooring, protected framing and boards, internal joinery and mouldings, lining, panelling and framework. (Whilst) preservative-treated material is (also) used for poles, piles, sleepers and cross-arms. It is often used as a cheaper alternative to oak for heavy construction, decking, vehicle building and sleepers, and in plywood.

Used by the US Military in floorboards, tanks, and vehicles, Wood Central has reported that the US Hardwood Federation has lobbied the Trump administration to replace Keruing (and Apitong) with American Red oak.

According to the EU, more than 5.3 million tonnes of Meranti timber products – sold as mouldings by Australian merchants – have been sold in the world over the decade to 2023 – with overharvesting to meet high demand the primary reason that 65% of species are threatened, and 86% have seen declining numbers: “This raises serious questions about the future availability of these species and the need for stronger trade controls,” according to a spokesperson who said the EU will push to add Keruing species to the CITES endangered species list ahead of COP20 in Uzberkstan later this year..

West Papua police have intensified their crackdown on illegal gold mining operations, arresting 31 suspects between January and July this year in the districts of Manokwari and Pegunungan Arfak.

This year’s figures show a significant increase compared to previous years. In 2023, nine miners were arrested, while eight were detained in 2022. The total amount of seized gold during those years was 78.76 grams.

While many of the illegal mining activities in Papua involve local residents, foreign nationals have also been implicated. In November 2021, six undocumented Chinese nationals were arrested for illegal gold mining in Sewa Village, Wapoga Sub-district, Waropen District.

Political will is among the most important factors in preventing tropical deforestation, according to a group of experts surveyed for a new study — with strong political commitment often arising out of long-term “public pressure” and civil society advocacy for forest protection.

Experts surveyed in the study emphasized that government actions, such as satellite monitoring in Brazil and the recognition of Indigenous lands, played a major role in reducing deforestation. In Indonesia, while political will was crucial, the involvement of corporations and civil society groups also contributed significantly to forest conservation. The research challenges the conventional focus on causes of deforestation, instead looking at factors that prevent it, offering insights into forest protection. The study found that political will was often a result of years of public pressure, rather than immediate action by political leaders. Brazil’s Forest Code and the recognition of Indigenous territories were key tools in its deforestation reduction efforts. Despite progress, shifting political winds, like the mixed responses to the EU’s upcoming deforestation regulation, can still influence forest conservation efforts. The study ultimately underscores the power of public advocacy and international pressure in creating lasting environmental change, showing that societies can protect forests if they are committed to doing so.

The US International Trade Commission (ITC) has sided with US producers of hardwood and decorative plywood (HWDP) after it found that there is a reasonable indication that imports from China, Indonesia and Vietnam “are materially injuring the US HWDP industry.” The petition – filed on May 22 – argued that imports from the three targeted countries benefit from dozens of government subsidy programs, including grants, subsidised inputs, tax breaks, and preferential loans.

It comes after the US Department of Commerce last month, announced the initiation of antidumping (AD) and countervailing duty (CVD) investigations into imports of HWDP from China, Indonesia, and Vietnam – with the petition alleging significant dumping margins as high as 540.07% for China, 84.94% for Indonesia, and 152.41% for Vietnam. Commerce is also examining 33 subsidy programs in China, 12 in Indonesia, and 26 in Vietnam.

Indonesia’s tax reform is entering a strategic phase. On the one hand, the government is pushing for transformation through a technology-based tax administration system by operating Coretax. On the other hand, state revenues continue to face structural challenges from economic activities that have so far been beyond the reach of the tax system (shadow economy or underground economy).

In this context, the collaboration between the Directorate General of Taxes (DJP) and the National Police of the Republic of Indonesia (Polri) is a step that deserves attention.

One form of this collaboration is the establishment of the Task Force for Optimization of State Revenue, which is directly under the coordination of the Chief of Police. Its mandate is to assist ministries/agencies in securing potential state revenue, particularly from sectors that are prone to leakage. Its main focus includes illegal fishing, illegal mining, and illegal logging activities that cause large fiscal losses. Satgassus certainly does not have the authority to collect taxes or set levy values because that is the authority of the Directorate General of Taxes. Its main role is as a law enforcer and operational assistant to technical ministries, such as the Ministry of Maritime Affairs and Fisheries, the Ministry of Energy and Mineral Resources, and the Ministry of Finance.

The Indonesian government has pledged to revoke the certificate of a palm oil plantation found guilty of operating within the Tesso Nilo National Park area in Palalawan District, Riau, a minister announced. Agrarian and Spatial Planning Minister/National Land Agency (BPN) Head Nusron Wahid stated that no further reverification is necessary, as his ministry has already conducted a field verification confirming the company’s legal violation.

Illegal logging dominated the violations registered by the Law Enforcement Agency of the Ministry of Environment and Forestry (Gakkum KLHK) in Sulawesi region from 2019 to mid-2024, with the agency recording 2,133 cases.
“In addition to illegal logging, the next most common cases involve the illegal harvesting of plants and wildlife,” a senior forestry police officer with the Sulawesi Region Gakkum KLHK, Muhammad Dahlan, said in Makassar on Monday. According to data from Gakkum KLHK Sulawesi, a total of 1,553 individuals were involved in the cases, many of whom have been brought to court.

Over the past four years, illegal agarwood harvesting and unauthorized logging have posed a severe threat to village forests in Malinau Selatan Hulu Subdistrict and Sungai Tubu Subdistrict, North Kalimantan. In response, Indigenous communities have taken decisive action to protect their increasingly endangered habitats. Nine Malinau Selatan Hulu and Sungai Tubu villages have signed a Joint Village Chief Regulation (Permakades) to safeguard their customary forests.

Recent data shows that Chinese banks have become the largest creditors to “forest-risk”* companies, after major producing countries Brazil and Indonesia, with over $23 billion in financing provided from 2018 to 2024.

Key Chinese banks, including CITIC, Industrial and Commercial Bank of China and Bank of China, are among the top creditors for “forest-risk” companies such as Royal Golden Eagle Group, which has faced repeated allegations that its supply chain has driven deforestation.

The increasing flow of finance to “forest-risk” companies undermines China’s climate and environmental goals under the Glasgow Leaders’ Declaration and national Green Finance Guidelines.

Meanwhile, Chinese banks rank poorly compared to their international counterparts in terms of deforestation-related policies, with four out of six major Chinese lenders scoring zero in the Forest 500 annual policy assessment.

The Coalition for Fair Trade in Hardwood Plywood alleges that the governments of Indonesia, Vietnam, and China are actively subsidizing dozens of programs benefiting their industries, including providing products at subsidized rates and multiple grant, tax, and lending programs. According to the petitions, hardwood and decorative plywood manufacturers in these countries are also dumping their products into the U.S. at discounted prices, with margins of up to 133.7% for Vietnam, 202.8% for Indonesia, and 474.2% for China.

The Indonesian Environment and Forestry Ministry has announced that it will no longer issue permits for timber extraction in mangrove ecosystems. Permits will now be prioritized for environmental services. Ristianto stated that environmental services in mangrove ecosystems could include the utilization of Non-Timber Forest Products (NTFP) and ecotourism. There is also potential for carbon economic value, especially for carbon trading.

Indonesian authorities arrested three judges who acquitted three palm oil companies of charges of corruption in obtaining export permits, an official said on Monday, following the arrest of a local court’s chief judge on bribery charges in the same matter.

A court last month acquitted the three companies – Wilmar Group, Musim Mas Group, and North Sumatra-based Permata Hijau Group – of charges of misconduct in obtaining export permits in 2022.

Indonesia plans to clear forests about the size of Belgium to produce sugarcane-derived bioethanol, rice and other food crops, potentially displacing Indigenous groups who rely on the land to survive

FSC is extending the suspension of the Asia Pulp and Paper (APP) Memorandum of Understanding (MoU) on the implementation of the FSC Remedy Framework until the end of June 2025.  In January 2025, FSC suspended APP’s remedy MoU until the end of March 2025 because of the changes APP and Domtar announced regarding the concentration of sole beneficial ownership of the two corporate groups.

FSC disassociated from APP’s entire corporate group in 2007. To remedy the environmental and social harms APP caused in the past, FSC and APP signed a remedy MoU in 2024 to implement the FSC Remedy Framework.

The ITTO has released the 2025 scores for its Global Timber Index. The GTI s a survey in nine pilot countries that covers timber harvesting, trade, and manufacturing, including production, orders, imports and exports, employees, inventory, raw material prices, and other business indicators. A GTI index reading above 50 per cent indicates the industry prosperity is generally expanding, while below 50 per cent indicates that it is generally declining.

Other news in the report includes:

• Thailand’s Commerce Ministry announced the simplification of export procedures for the export of Thai wooden products. Except for Siamese Rosewood, which remains banned from export, companies are no longer required to obtain a permit to export these wooden products.
• On sustainable forest management, the report said Brazil’s National Biodiversity Commission established national biodiversity targets for the period 2025-2030, including a target of achieving zero deforestation in the country.

The global agarwood trade heavily depends on wild-harvested endangered tree species, despite international regulations for protection, with significant volumes going undocumented in official trade records, a new study reveals.

About 70% of the trade depend on Aquilaria filaria and Aquilaria malaccensis, both threatened species, sourced from the wild, raising major sustainability concerns. Meanwhile, there are some tree species that are not even covered by CITES, the global wildlife trade convention.

Due to discrepancies between CITES and customs data, along with weak enforcement and outdated regulations, researchers suggest the illegal trade is far larger than reported.

Researchers urge stronger monitoring, updated data, expanded species protection, and a shift to cultivated sources. They also call on consumers and wealthy importers to support conservation and governments to promote sustainable practices.

Japanese paper and packaging giant Oji Holdings and New Forests, a global investment manager focused on nature-based assets, announced on March 26 a US$300 million (S$401 million) fund to buy forestry estates, with the majority of the investment set to be in South-east Asia.

The fund is a reflection of increasing investor interest in forestry not only for stable returns from timber revenues but also for the climate, and increasingly biodiversity, benefits. Large timber concessions that have tracts of natural forest can also earn revenue from carbon credits by keeping the forests standing.

New Forests had nearly 912,000ha of certified forests under management globally in the 2024 financial year (July-June), with an additional 200,196ha of conservation areas, according to its latest sustainability report.

Ministry of Environment and Forestry (KLHK) praised the ruling of East Java’s Surabaya District Court that awarded imprisonment and imposed fines of billions of rupiah on five companies’ directors for illegal logging distribution from Papua.

In a statement from the Directorate General of Law Enforcement (Gakkum) of KLHK, Director General Rasio Ridho Sani expressed hope that the prison sentences of six to nine years and fines of Rp6 billion to Rp9 billion (around US$379 thousand-US$579 thousand) imposed on five companies would provide a deterrent effect.

At that time, 59 containers loaded with processed Merbau wood were seized that were transported aboard the MV Verizon ship and KM Hijau Jelita ship at Tanjung Perak Port, Surabaya, East Java. After checking the 59 containers, it was found that they were filled with chainsaw-sawn processed wood of various sizes.

The five companies are CV Aditamah Mandiri, CV Gefariel, PT Guraja Mandiri Perkasa, CV Wami Start, and PT Eka Dwika Perkasa regarding the case of the distribution of illegal Merbau wood from Nabire, Papua, to Surabaya.

Indonesia’s largest environmental group, Walhi, has filed a formal complaint with the Attorney General’s Office, accusing 47 companies of environmental destruction and corruption. The companies, which operate in industries like palm oil, mining and forestry, are accused of being responsible for 437 trillion rupiah ($26.5 billion) in state losses.

Based on field investigations and spatial analysis, Walhi says it has identified 18 forms of gratuities paid by the companies to officials in the 47 cases. In some of these cases, Walhi found that officials had approved the rescinding of forest status for certain areas by revising zoning plans, thereby allowing the companies to clear forests for their concessions. In other cases, Walhi found officials had retroactively legalized illegal plantations within forest zones through an amnesty program, again giving companies legal cover to deforest without being prosecuted for their crimes. Other alleged corruption schemes that Walhi identified include the granting of permits for concessions that clearly violated zoning plans, and officials taking bribes to ignore illegal activities.

By early 2024, more than 2000 companies had been fined for illegal operations, but fines were not being paid.

Operation Thunder 2024 (11 November – 6 December) brought together police, customs, border control, forestry and wildlife officials from 138 countries and regions.  Authorities arrested 365 suspects and identified six transnational criminal networks suspected of trafficking animals and plants protected by the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES).

Timber cases represent the most significant seizures, primarily occurring in sea cargo container shipments, while most other seizures took place at airports and mail processing hubs. More than 49,000 pieces, 214.9 tonnes, or 1340 cubic meters were seized. Significant seizures included:

• Indonesia: 134 tonnes of timber headed to Asia via ocean freight.
• Kenya: 41 tonnes of exotic timber headed to Asia via ocean freight.

The participation of numerous countries contributed to the success of intelligence efforts in the operations, targeting high-value suspects. Authorities  investigated online activities and found suspects using multiple profiles and linked accounts across social media platforms and marketplaces to expand their reach.

A call by the Indonesian environmentalists and Catholic activists have slammed a government plan to clear about 20 million hectares of forest for food and energy projects.

In a statement on Jan. 2, Forestry Minister Raja Juli Antoni said that 20 million hectares of forest spread across the archipelago will be converted to be utilized by the Ministry of Agriculture and the Ministry of Energy and Mineral Resources. He said the government plans to plant dryland rice, targeting an additional rice stock of up to 3.5 million tons per year, equivalent to the amount of rice imports in 2023. In addition, he said, the land will also be planted with arena trees that can produce 24,000 kiloliters of bioethanol, an alternative fuel to replace gasoline.

Subsidies for forest biomass energy in Japan and South Korea are contributing to deforestation in Southeast Asia, according to an October 2024 report by environmental NGOs. The biomass industry is expanding especially quickly in Indonesia; the nation is exporting rapidly growing volumes of wood pellets, and is burning biomass at its domestic power plants.

Japanese trading company Hanwa confirmed that rainforest is being cleared to establish an energy forest plantation for wood pellet production in Indonesia’s Sulawesi Island. Hanwa owns a stake in the project. The wood pellet mill uses cleared rainforest as a feedstock while the monoculture plantation is being established.

A Hanwa representative defended the Sulawesi biomass project by claiming the area consists of previously logged secondary growth and that the energy plantation concession is not officially classified as “forest area.”

The Oil Palm Farmers Union of Indonesia, made up of smallholder oil palm producers, also shared a statement statement calling for the EUDR to no longer be delayed and for implementation to move forward (statement is in Bahasa).

An investigation by Rainforest Action Network has identified new illegal forest clearing for palm oil in Indonesia’s protected Leuser ecosystem. The loss of habitat for endangered species such as the Sumatran orangutan has been connected to Singapore-headquartered firms with no-deforestation pledges that supply major consumer brands.

The Ivory Coast is steadily gaining on southeast Asian nations as a major rubber producer, buoyed by pending sustainability rules in Europe.

The West African country produced 1.55 million tonnes of natural rubber last year, according to the International Rubber Study Group. That is nearly double the 815,000 tonnes produced in 2019 and puts the Ivory Coast ahead of Vietnam in becoming the world’s third-largest producer, after Thailand and Indonesia.

Indonesia and Thailand currently produce about half the world’s natural rubber. But Indonesia, the world’s second-largest producer, saw output drop 20% from 2019 to 2.65 million tonnes last year. Unlike Ivory Coast, Indonesia is seeing a decline in the number of farmers producing natural rubber.

Over the past decade, Indonesia has achieved a remarkable reduction in deforestation for palm oil production. In 2018–2022, deforestation for palm oil was 32,406 hectares per year (the size of 60,664 American football fields) – only 18% of its peak a decade earlier. Importantly, deforestation has fallen during a period of continued expansion of palm oil production.

Our analysis of the latest data for Trase, a non-profit organization that specializes in research on commodity-driven deforestation, shows this achievement is at risk. Data for 2022 shows an 18% increase in deforestation linked to palm oil, though it remained lower than all previous years analyzed except 2021.

Mining is one of the fastest growing causes of deforestation, with a new report published by the World Resources Institue (WRI) revealing that 1.4 million hectares of forests, an area the size of Montenegro, was lost to the extraction of coal, iron and industrial minerals for the 20 years to 2020.Since the turn of the century, mining has increased by 52%.  This includes tropical primary rainforests, some of the world’s most important ecosystems where mining is a growing loss driver, and Indigenous and local community territories, where people depend on forests for their livelihoods.

More than 89% of the loss is concentrated in just 11 countries, including Indonesia, Brazil, Russia, the United States, Canada, Peru, Ghana, Suriname, Myanmar, Australia and Guyana.

Indonesia’s strategy for increasing renewable energy production could see Indigenous communities lose huge swathes of their forests to biomass plantations. Mongabay visited the planned site of one such project on the island of Borneo, where three villages have signed over at least 5,000 hectares of their land to a biomass company. Much of this area, locals say, is covered in rainforest that would presumably be cleared for the project.

Despite its billing as sustainable, research has shown that burning woody biomass emits more climate change-causing CO2 than coal per unit of electricity produced. The company in Borneo, moreover, has said it plans to export the wood pellets to be produced on its plantation.

Villagers we spoke to complained of unfair dealing by the company, from inadequate compensation to outright land grabbing with no payment or consent.

This article looks at the activities of the Indonesia Corruption Eradication Commission as it relates to former President Joko Widodo and his family. This includes ties to Sinar Mas, one of Indonesia’s largest conglomerates. Sinar Mas has not been penalized by regulators even though its subsidiaries had been implicated in forest fires in Indonesia in 2019 — possibly due to close tikes between Mr Joko’s sons and children of Sinar Mas executives.

The Indonesian government is embarking on yet another project to establish a massive area of farmland at the expense of forests and Indigenous lands, despite a long history of near-identical failures.

The latest megaproject calls for clearing 1 million hectares (2.5 million acres) in the district of Merauke in the eastern region of Papua for rice fields.

At least one industry assiation is proposing that the government should open the door to exporting sawn timber products to make up for the slop demand for Indonesian plywood.

• Over 1,800 hectares of natural forest in the timber concession of Babugus Wahana Lestari in Central Kalimantan is facing immediate threat of destruction, Earthsight and Auriga Nusantara can reveal. Local residents say the company plans to clear the forest to plant fast-growing timber for use in bioenergy
• Babugus Wahana Lestari had its timber legality certification suspended in October 2023, after auditors found it logging outside permitted areas
• Earthsight/Auriga have identified two Indonesian companies which in 2023 purchased timber from the concession while also exporting wood products to the EU
• The case underlines the critical importance of the EUDR, to ensure European consumers are not complicit in use of wood products produced illegally or on recently deforested land.

• Over 1,800 hectares of natural forest in the timber concession of Babugus Wahana Lestari in Central Kalimantan is facing immediate threat of destruction, Earthsight and Auriga Nusantara can reveal. Local residents say the company plans to clear the forest to plant fast-growing timber for use in bioenergy
• Babugus Wahana Lestari had its timber legality certification suspended in October 2023, after auditors found it logging outside permitted areas
• Earthsight/Auriga have identified two Indonesian companies which in 2023 purchased timber from the concession while also exporting wood products to the EU
• The case underlines the critical importance of the EUDR, to ensure European consumers are not complicit in use of wood products produced illegally or on recently deforested land.

The Acting Head of the Forest and Environmental Agency of Riau Province, Muhammad Job, stated on Tuesday (9/7/2024) that the current area of mangrove forests in Riau has reached 225,376 hectares.

However, the mangrove forests in Riau are threatened with land degradation. The cause is the emergence of various illegal activities, such as illegal logging and land conversion.

In some areas, such as in Bengkalis Regency, there are still residents who chop down mangrove trees to be used as charcoal and as a basic material for raised house foundations. On the other hand, the practice of converting mangrove land into shrimp ponds or oil palm plantations is still occurring in several places.

A state-owned palm oil company and an industry association have begun early work to push a vast new plantation strategy in Sulawesi, one of Indonesia’s largest islands.

The proposal includes aspirations for production of a form of environmentally friendly fertilizer that the signatories to a document signed in May hope will enable producers to apply for climate finance incentives, despite the deforestation implied in the plan.

The Indonesian government is working on improving and synchronizing its forest and supply chain data to comply with increasingly strict sustainability standards and requirements in markets where it exports to, including the European Union. Earlier this year, the Indonesian government discovered discrepancies between the forest map and data that it uses, and those used by the EU as a reference for the implementation of the European Union Deforestation Regulation (EUDR).

Another effort that the Indonesian government is undertaking to make it easier for its producers to prove that their products are deforestation-free is developing a supply chain traceability system.

The system will be in the form of an online dashboard, set for launch in September, which will collect and synchronize all data and maps related to various commodities, such as palm oil, coffee, cocoa and rubber, at all stages of the supply chain.

An investigation by an NGO coalition in Indonesia alleges that two pulp and paper giants — Asia Pulp & Paper (APP) and Asia Pacific Resources International Holdings Ltd. (APRIL) — have cleared natural forests and peatlands in violation of their zero-deforestation pledges.

The allegations center on a concession operated by PT Riau Andalan Pulp & Paper (RAPP) in Siak district of Riau province, a concession managed by an open market supplier to APRIL, PT Selaras Abadi Utama (SAU), in Pelalawan district of Riau province, and a block of land in Riau managed by a local cooperative that has a working agreement with an APP subsidiary, PT Arara Abadi (AA).

APRIL reiterated its commitment to sustainability and zero-deforestation and APP denied that any illegal timber had entered its supply chain.

Land restored by local residents in Borneo drew an array of wildlife after nonprofit groups first addressed the needs of nearby villagers.

Nearly 20 years ago, workers from Alam Sehat Lestari and Health in Harmony began asking villagers around the Gunung Palung National Park what they would need to protect the forest, where illegal logging had frequently occurred. This article summarizes what happened next…

This Fern Op-Ed argues that the traceability requirement at the heart of the E.U.’s new deforestation law can also help lift smallholder farmers around the world out of poverty.

For example, in Côte d’Ivoire, farmers’ organisations say they support the Regulation because it could help push their government to complete the national cocoa traceability system — which they have been demanding for many years, as a means of ridding the local cocoa sector of corruption. This corruption blights the lives of smallholders, who are regularly forced to sell below the government-set price, with multiple local middlemen taking cuts along the way.

Years after being felled, vast swathes of Indonesia’s old-growth forests are left sitting idle. And when the land is finally put to use, it’s most often for new palm oil plantations, according to a study published in the Proceedings of the National Academy of Sciences.

But some experts — including the study’s authors — are hoping for a silver lining: The opportunity for Indonesia to expand its agricultural, palm, pulp and other commodities without having to cut down more trees, thus meeting increasing demand from companies and governments for products that didn’t depend on deforestation.

A short briefing on the growing interest in science journalism and some of the techniques deployed, For example, In 2011, a leading environmental journalist  created a communication channel that empowered people living in remote areas of Borneo to send news reports via text messaging to Ruai TV, a station in the provincial capital. The initiative also trained citizen journalists on how to use mobile phones to document issues such as illegal logging and illicit land clearing in the region.

Alleged environmental and human rights violations by Indonesia’s second-largest palm oil producer implicate multinationals including Unilever, Olam, BlackRock and Jardine Matheson. The allegations come amid Indonesia’s push for better governance over its palm oil industry, which is the world’s largest. AAL denies any wrongdoing.

The original Friends of the Earth report here: Indonesian palm oil linked to illegal deforestation, land rights violations (foe.org)

A plan to establish 2 million hectares (nearly 5 million acres) of sugarcane plantations in Merauke district, in Indonesia’s Papua region, calls for deforesting an area six times the size of Jakarta, even as the government touts the green credentials of the project in the form of the bioethanol that it plans to produce from the sugar. Activists warn that the project risks becoming yet another land grab that deprives Indigenous Papuans of their customary lands and rights without fair compensation. They point out the  parallels to similarly ambitious projects that failed, the alleged involvement of palm oil firms, and government insistences that this richly forested region of Indonesia doesn’t have much forest left.

The Chairman of the Village Forest Management Institution (LPHD) in Alue Jeureujak, Babahrot District, Bustami, said that illegal logging activities within the protected forest area have been going on for a long time, but there has been no enforcement.

The Irrawaddy River is a flashpoint for conflict timber, with more than 100 tons—and sometimes up to 300 tons—of teak and other species leaving Myanmar ports every week.

The teak is then traded into Western Markets (including Italy, teak’s entry point into the EU) via China, India and Indonesia, with proceeds used to fuel both sides of the conflict.

Yesterday, Mynamar officials announced that more than 1,600 tons of teak (more than 250 tonnes a week) had been confiscated over the past six weeks, in a major escalation in the trade across borders. And that is just the timber, deemed “illegal” by the junta-controlled government – with the hidden trade in teak booming amongst the junta’s allies.

All nations have some unmapped or unofficial roads, but the situation is especially bad in biodiversity-rich developing nations, where roads are proliferating at the fastest pace in human history.

When ghost roads appear, local deforestation soars—usually immediately after the roads are built. We found the density of roads was by far the most important predictor of forest loss, outstripping 38 other variables.

Also reported here: Scientists find vast numbers of illegal ‘ghost roads’ used to crack open pristine rainforest (phys.org)

The ITTO MIS reports that the Government of Indonesia has stated that  geolocation information will be integrated into various forest product utilisation systems managed by KLHK, such as the Forest Utilisation Business Control Information System (SIPASHUT), the Forest Product Administration Information System (SIPUHH), the Raw Material Utilisation Plan Information System (SIRPBBPHH) and the Timber Legality Information System (SVLK).

In related news, the founder of the Indonesian Forestry Certification Cooperation (IFCC), is developing a draft document and scheme that exporters can use as a reference that enables exporters to obtain a geolocation after a certification audit.  The aim is to assist exporters adapt to the EUDR regulations.

Ministry of Environment and Forestry (KLHK) praised the ruling of East Java’s Surabaya District Court that awarded imprisonment and imposed fines of billions of rupiah on five companies’ directors for illegal logging distribution from Papua.

The international trade body backed the EU’s decision to impose rules against palm oil as a biofuel due to emission risks but said the bloc failed to properly implement them, validating complaints by trade partner Malaysia.

The report summarizes the use of biofuels in Indonesia and Malaysia as well.

Last November, French NGO Sherpa filed a complaint with the National Prosecutor’s Office against French banks BNP Paribas, Crédit Agricole, BPCE, and Axa. It called for a criminal investigation into money laundering and concealment, arguing that the banks’ financial support for Brazil’s biggest beef companies was contributing to illegal deforestation in the Amazon.

RAN’s investigators have once again documented illegal expansion into nationally protected areas in the Leuser Ecosystem in the district of Aceh Tamiang on the island of Sumatra.

RAN indicates no government or supply chain interventions taken during this period to stop the destruction even though the district government of Aceh Tamiang has public commitments to end deforestation and PepsiCo, Unilever and others claim that collaborative forest monitoring systems are being used to identify and respond to deforestation across the district.

Deforestation for oil palm plantations has increased for the second year in a row in Indonesia, the world’s biggest producer of palm oil, bucking a decade-long decline in forest loss.

A third of the 2023 deforestation occurred on carbon-rich peatlands, raising the potential for massive greenhouse gas emissions as these areas are cleared and drained in preparation for planting.

Historically, deforestation for plantations in Indonesia was concentrated on the island of Sumatra, but the surge in the past two years has been mostly on the islands of Indonesian Borneo and Papua.

The EUDR’s geolocation requirement is equivalent to Indonesia’s plantation cultivation permit (STDB), which must be obtained through registration with the Agriculture Ministry’s Plantations Directorate General.

“We estimate that of the 3.2 million hectares of people’s plantation land, only 10,000 ha already have the STDB,” Erwin said, urging the government to facilitate the registration of smallholder farmers, who produce 90 per cent of Indonesia’s natural rubber. Plantations Director General Andi Nur Alam Syah said the ministry would push regional governments to expedite data collection, mapping, verification and issuance of STDB for rubber farmers by the end of the year, when the EUDR will begin to apply.

From 2016-2018, 94% of Germany’s directly imported deforestation risk was linked to just five key commodities: soy, coffee, palm oil, cocoa and cattle. More than 90% of this comes from nine countries, including Brazil Colombia, and Indonesia. Deforestation risk in Germany’s supply chains has varied over time, but has recently begun to emerge in particular hotspots, such as Colombia.

Deforestation risk can be concentrated in particular areas within hotspots: more than half of Brazilian soy deforestation risk comes from just three municipalities in the Matopiba region.

The government has planned to build a special economic zone (SEZ) for the wood industry to increase the wood production and competitiveness of Indonesian timber and furniture products. All regulations and facilities will be integrated in the wood industry SEZ, including the wood downstreaming industry.

Wilmar International’s No Deforestation, No Peat, No Exploitation policy, announced ten years ago, marked a significant milestone in environmental conservation by prohibiting deforestation, peatland destruction, land-grabbing, and labor abuses in their global supply chain, impacting thousands of palm oil companies.

The policy, a result of global campaigning and intense negotiations, contributed to a dramatic reduction in deforestation for palm oil by over 90%, influencing other industries and contributing to the lowest deforestation levels in Indonesia, as well as progress in Malaysia, Papua New Guinea, and tropical Africa, argues Glenn Hurowitz, the Founder and CEO of Mighty Earth, who led the negotiation with Wilmar.

Hurowitz says this “success story” highlights the importance of private sector involvement, effective campaigning, diligent implementation, the necessity of continuous effort, and the insufficiency of data alone in driving change.

But an investigation by nonprofit newsroom The Gecko Project reveals how First Resources’ majority shareholders, the billionaire Fangiono family, have breached their company’s pledge of “sustainable” production by secretly controlling companies that environmental analysts found had cleared large areas of rainforest in Indonesia.

The investigation in collaboration with the International Consortium of Investigative Journalists also spotlights a loophole in the Singapore Exchange’s reporting rules that allows listed companies to publish so-called sustainability reports, without requiring that an independent firm audits the company’s green claims.

With enforcement of a new deforestation law on the horizon, stakeholders along the food supply chain and working to ensure compliance. We look at the new tools and services being developed that promise enhanced traceability and due diligence.

The news article highlights how a park in Indonesia  is a beneficiary of the Lindu community’s distinctive approach to forest conservation, which stems from customary law.

The state has a buy-in, and helps impose these customary laws, or rules.  Administration officials work with a customary council of elders and village representatives, called Totua Ngata, to ensure that rules are respected and enforced.

Investigations by ICIJ partners and others have previously linked Paper Excellence to Asia Pulp & Paper, a Chinese-Indonesian forestry company accused of deforestation and human rights abuses.

New Global Witness report indicates that the UK’s two-year old environmental legislation has not affected deforestation due to lack of follow-up by the government.

Also covered here: Beef, soy and palm oil products linked to deforestation still imported into UK | Deforestation | The Guardian

The Netherlands is Europe’s largest importer of deforestation-linked products with a surge in wood and wood-based products from China and Brazil. The Dutch are the largest importer of soy, palm oil and cocoa and, most significantly, the region’s second-largest importer of wood products. Of the total imports that transition through the port, 28% are re-exported abroad, 33% are traded into European markets after processing, and 39% remain in the country for direct consumption or secondary processing.

As a result of its place in the global trade, the government of Netherlands has been urged by some producer countries to push back on the EUDR.

Negotiations have begun between the world’s top two palm oil producers and the EU to address sticking points in a deforestation law that would make it harder for the commodity to enter European markets.

Indonesia and Malaysia account for 85% of global palm oil exports, and would be heavily impacted by the EU Deforestation-Free Regulation (EUDR), which prohibits imports into the EU of commodities sourced by clearing forests.

At the first joint meeting of an EU-Indonesia-Malaysia task force, delegates discussed risk designations for producer countries as well as the role of certification schemes like the RSPO to help meet EUDR requirements.

Indonesian officials say their main issue with the EUDR is that it discriminates against small farmers, who manage 41% of the total plantation area in the country and would have difficulty complying with the new regulation’s requirements.

Palm oil farmers in Indonesia have established a new foundation to help farmers around the country in protecting forests and selling their sustainable products to the global market.

This opinion piece by HSBC Indonesia President Director summarizes not just the recent EUDR, but also some potential opportunities .

The EU-Indonesia Comprehensive Economic Partnership (CEPA), is currently being discussed and hopefully will be signed this year. It has the potential to transform what looks like a potential export blocker into an opportunity to strengthen trade and disclosure between the two parties. Also, Indonesia’s Green Taxonomy 1.0 launched by the Financial Services Authority (OJK) in 2022 is one of the first policy attempts to encourage the private sector to prioritize green investments and further incentivize businesses to comply with environment, social and governance (ESG)-related regulations that can otherwise become barriers to access sustainable finance. The taxonomy can eventually help the commodities sector to access sustainable financing to help their companies integrate ESG practices and standards into their supply chain, which allows them to access EU market.

This article provides background on the EUDR and potential for technology to monitor deforestation rates and help farmers provide information about their farming practices. A pilot in Indonesia is described, as well as potential future projects in Bolivia, Colombia and Honduras.

The hugely controversial law, deemed unconstitutional in a court challenge yet somehow still in force, did away with criminal punishment for illegal plantations and their operators, and instead allowed them to be legalised by paying fines and applying for rezoning of the land to non-forest area.

The amnesty scheme has drawn criticism from activists and some lawmakers. Critics say the scheme whitewashes the crimes of setting up plantations inside areas zoned as forest, where deforestation, wildfires and land conflicts are rife.

And while the Ministry of Environment and Forestry says the amnesty program is also geared toward small farmers who manage illegal smallholdings, most of the plantations that have benefitted to date are run by companies, according to Uli Arta Siagian, forest and plantation campaign manager at environmental NGO Walhi.

The Sustainable Jurisdictions Indicators measure the commitment of a commodity-producing region that is sustainable and inclusive. Twenty-three indicators build on Indonesia’s legal framework as well as various international commitments, especially the Sustainable Development Goals (SDGs).

These indicators are expected to provide an enabling environment for accelerating the fulfilment of various certification schemes such as the Indonesian Sustainable Palm Oil (ISPO) and the Roundtable on Sustainable Palm Oil (RSPO).

The Indicators will be displayed on a platform that allows various parties to view and picture the situation, committments and performance of the regions nationally.

Indonesian plywood producers are considering the IFCCPEFC certification scheme in order to strengthen penetration into the export market as well as to support sustainable forest management.

See: https://forestinsights.id/2023/03/24/produsen-kayu-lapislirik-sertifikasi-ifcc-pefc-akreditasi-kan-jadi-satu-alasan/

The European Union’s decision to impose new rules regulating the timber trade has pushed Indonesia to act. On 1 March 2023 the Ministry of Environment and Forestry (KLHK) finalised a ‘new’ SVLK. The SVLK has changed to the ‘Legality and Sustainability Verification System’ with the same abbreviation, SVLK. This new regulation deals with the legality of timber sources and identifies the sources that are sustainably managed.

The Director General of Sustainable Forest Management in the KLHK, Agus Justianto, when speaking at a seminar held by the Indonesian Timber Panel Association (Apkindo), said the previous SVLK also had sustainability aspects in its criteria and indicators. With the word sustainability (for the new SVLK), now emphasises legality and sustainability, he said. According to Agus, the SVLK has evolved to include, for example, a longer validity period for certificates for cultivated wood. There are also financing facilities for certification for micro, small and medium enterprises. He added that the government’s quick action in rebranding the SVLK should be appreciated as it deals with market requirements as the EU wood product market is large and Indonesia must act to capture a greater market share. See: https://agroindonesia.co.id/svlk-baru-perkuat-kelestarian/

Indonesia’s furniture and crafts exports reached US$2.8 billion in 2022 and the government hopes that exports will increase to US$5 billion in 2024.

The Ministry of Industry has two strategies to improve profitability in the sector. First, greater emphasis on the domestic market as the size of this market, especially the middle class segment, continues to expand. The second is exports to non-traditional markets for example India and the Middle East where growth in the property sector is relatively stable.

The Indonesian Furniture and Craft Association (HIMKI) chairman, Abdul Sobur, revealed that exports to the EU declined in 2022 so HIMKI members are now investigating the Middle East markets such as Qatar, Israel and the United Arab Emirates.

The Director General of Sustainable Forest Management, Ministry of Environment and Forestry (KLHK), Agus Justianto, is reported as saying Indonesia is ready to challenge the European Union (EU) at the World Trade Organisation (WTO) regarding the enactment of the deforestation-free law which, Indonesia considers, will become a trade barrier for wood products.

In March 2023, the ICIJ and 39 media partners published Deforestation Inc., a global investigation that exposed flaws in environmental auditing and certification programs intended to promote responsible forestry and combat illegal logging and deforestation. For this month’s episode of the Meet the Investigators podcast, we recorded a special live panel featuring reporters who had visited ravaged forests, tracked shipments of timber around the world, and trawled through corporate documents, leaked files and more to uncover the many ways in which a system designed to protect the environment, consumers and investors is failing with concerning frequency.

The situation in Myanmar, Romania, Indonesia, Germany is featured, as well as with the extent and nature of problems with falsified documents and  certification systems more broadly.

The forest loss was driven by clearing for oil palm plantations by well-connected local elites, rather than smallholders, according to advocacy group Rainforest Action Network (RAN).

RAN’s investigation found that palm oil from these illegal plantations had wound up in the global supply chains of major brands like Procter & Gamble, Nestlé, PepsiCo and Unilever, among others.

The International Consortium of Investigative Journalistts and partners uncovered hidden links between Canada’s Paper Excellence and troubled Indonesian company Asia Pulp & Paper.

Lawmakers in Canada are calling for an investigation into one of North America’s largest pulp and paper manufacturers, following revelations in Deforestation Inc., a cross-border investigation led by the International Consortium of Investigative Journalists.

The parliamentarians said they are seeking answers into who is behind Paper Excellence, a company headquartered in British Columbia, after journalists revealed extensive links between the company and entities in Indonesia and China.

As Indonesia gears up for legislative and presidential elections in less than a year, authorities have warned of the pattern of dirty money from illegal logging, mining and fishing flowing into past campaigns.

As Indonesia gears up for legislative and presidential elections in less than a year, authorities have warned of the pattern of dirty money from illegal logging, mining and fishing flowing into past campaigns.

The report traces key drivers of palm oil in the Chinese market, focusing on relationships
between various factors, highlighting general trends/patterns derived from the research.

• A significant portion of orangutan habitat in Indonesia lies within corporate concessions, but industrial tree companies, like pulp and paper, don’t have strong enough safeguards and commitment to protect the critically endangered apes, a new report says.
• According to the report by Aidenvironment, there are 6.22 million hectares (15.37 million acres) of orangutan habitat within corporate oil palm, logging, and industrial tree concessions.
• Of the three types of concessions, industrial tree companies are the “key stakeholder” as they operate with much less transparency and scrutiny than the palm oil sector, Aidenvironment says.

• A World Bank-funded conservation project in Indonesia led to higher rates of deforestation after the project ended, a new study shows, serving as a cautionary tale about the risks of failing to sustain such initiatives over a long enough time period.
• The payment for ecosystem services project was supposed to reward villages for halting deforestation and taking up sustainable livelihoods from 1996-2001.
• In the years after the project ended, however, participating villages that had received the payments lost up to 26% more forest cover from 2000-2016 than non-participating villages, the study shows.

A court filing reveals lucrative timber exports were a strong focus of forest-clearing by a part-Kiwi-owned firm operating in an area with substantial tropical rainforest in West Papua

Documents tabled in a New Zealand court case show how a Kiwi developer and a company which has cut down Papuan rainforest intend to make around $110 million from the timber to make floors and decks – in stark contrast to statements made in a recent Newsroom investigation.

Newsroom has secured the documentary evidence that lays out in detail how an Indonesian company linked to a New Zealand property developer intends to make close to A$100 million from clearing trees in an area of primary rainforest in Papua.

 Indonesia will reimpose a domestic sales requirement on palm oil, the government said on Friday, a day after the world’s biggest producer of the key edible oil reversed a ban on its export.

President Joko Widodo’s government has made several reversals on palm oil policy since November. The late-April export ban, an attempt to control high domestic cooking oil prices, shocked global edible oil markets and angered farmers as their product prices fell.

JAKARTA, April 27 (Reuters) – Indonesia widened the scope of its export ban on raw materials for cooking oil to include crude and refined palm oil, its chief economic minister said on Wednesday, leaving markets in shock over the latest policy reversal.

The announcement flipped the minister’s statement a day earlier, in which he had said the export ban would only cover refined, bleached, and deodorized palm olein.

JAKARTA — Indonesia, the world’s largest producer of palm oil, on Friday announced an export ban of the commodity amid a continuing cooking oil crisis in the country.

Indonesian President Joko “Jokowi” Widodo said the ban on shipments of “raw materials for cooking oil and cooking oil” will take effect next Thursday for an indefinite period.

A subsidiary of South Korean paper company Moorim has cleared natural forests a tenth the size of Seoul in Indonesia’s Papua region over the past six years, a new report alleges. The report, published by various NGOs, alleges that the cleared areas consisted of primary forests serving as a habitat for threatened species and a source of livelihood for Indigenous Papuans.

An investigation by the Rainforest Action Network (RAN) indicates that a palm oil company in Sumatra has been clearing forests illegally since at least 2016. The extent of the clearing by PT Nia Yulided Bersaudara (NYB), nearly two and a half times the size of New York City’s Central Park, makes it the top deforester among companies that have an oil palm concession in Sumatra’s Leuser Ecosystem.

The water patrol police of Meranti Islands, Riau Province, arrested two illegal loggers found transporting 13 cubic meters of wood using a boat in the waters near Dedap Village, Tasik Putripuyu Sub-district, on Monday night.

Police in Indonesia’s Riau Islands have reported a 280% increase in seizures of mangrove wood from would-be smugglers this year.

Police said much of the wood was cut from the main island of Batam, and destined for nearby Singapore and Malaysia.

Indonesia is targeting the rehabilitation of 630,000 hectares (1.55 million acres) of mangrove forests across the country by 2024.

Indonesia, the world’s biggest palm oil grower, lets a three-year moratorium on new plantations lapse but says it won’t give new permits. Will the move weaken forest protection?

A monitoring exercise by Indigenous peoples and local communities of Indonesia’s “certified legal” timber industry has found myriad violations.

The group reported, among other findings, logging companies cutting down trees outside their concessions, woodworking shops manipulating delivery records to obscure the origin of the wood, and exporters selling forged export eligibility certificates.