To produce palm oil in large enough quantities to meet growing demand, farmers across Southeast Asia have been clearing huge swaths of biodiversity-rich tropical rainforest to make room for massive palm plantations. Today palm oil production is the largest cause of deforestation in Indonesia and other equatorial countries with dwindling expanses of tropical rainforest.
- An estimated 1.5 million small farmers grow the crop in Indonesia, along with about 500,000 people directly employed in the sector in Malaysia, plus those connected with related industries.
- As of 2006, the cumulative land area of palm oil plantations is approximately 11,000,000 hectares (42,000 sq mi). In 2005 the Malaysian Palm Oil Association, responsible for about half of the world's crop, estimated that they manage about half a billion perennial carbon-sequestering palm trees. Demand for palm oil has been rising and is expected to climb further.
- Between 1967 and 2000 the area under cultivation in Indonesia expanded from less than 2,000 square kilometres (770 sq mi) to more than 30,000 square kilometres (12,000 sq mi). Deforestation in Indonesia for palm oil (and illegal logging) is so rapid that a 2007 United Nations Environment Programme (UNEP) report said that most of the country’s forest might be destroyed by 2022. The rate of forest loss has declined in the past decade.
- Global production is forecast at a record 46.9m tonnes in 2010, up from 45.3m in 2009, with Indonesia providing most of the increase.
“Oil palm agriculture could soon be a major emerging threat to the Amazon. In concert with massive expansion of Amazonian cattle ranching and soy farms, it could sharply increase economic incentives favoring destruction of Amazonian forests. Conservation interests must prepare to deal with this new challenge, which could potentially have serious economic, social, and environmental impacts. Particularly urgent is a need to confront recent political and corporate assertions in Brazil that massive oil palm expansion would occur almost solely on deforested lands without threatening native ecosystems—an argument clearly divorced from economic and biological reality.”