THE OUTLOOK FOR LARGE SCALE OIL PALM EXPANSION IN LIBERIA PRESENTED BY: CHEA B. GARLEY/LIBERIA
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1 THE OUTLOOK FOR LARGE SCALE OIL PALM EXPANSION IN LIBERIA PRESENTED BY: CHEA B. GARLEY/LIBERIA
2 THE MAP OF LIBERIA
3 THE FLAG OF LIBERIA
4 THE OUTLOOK FOR LARGE SCALE OIL PALM EXPANSION IN LIBERIA Liberia is an agricultural nation and 60% of the nation exports are derived from agricultural products About 90% of the Liberian population earns its livelihood from agriculture It is difficult to establish with certainty the total planted acreage of Oil palm plantations before the civil unrest, which might have been around 27,000 Ha, Total land allocated to the various operators in the Oil palm sector for exploitation was estimated at 50,000 Ha. All the plantations in the Liberian Oil palm Sector were established between the early sixties and the early eighties (1960 to 1984) and the trees have considerably aged (above 30 years). There is a review of the current situation and investments opportunities in the oil palm sector. Four major international oil palm companies two of the largest Malaysian and Indonesian companies,sime Darby, Sinar Mas known locally as Golden VerOleum,Equatorial Palm Oil Limited and Socfin/Cavalla have signed and ratified concessions agreements with the Liberian Government.
5 OIL PALM EXPORT POTENTIAL Oil palm is widely grown on smallholder farms often for domestic or regional consumption and represent half the country total agricultural GDP. Palm oil shows steady export growth from a very low base, with over 90% of this being destined for north Africa import levels of refined crude palm oil range between 2,000 to 10,000 tonnes. There is an opportunity to increase local palm oil production in the county due to a high consumer preference. Major plantations in Liberia have indicated expansions plans but land tenure has been stated as a major constraint. There is an unmet demand for palm oil in the ECOWAS region, which is estimated at 360,000 tons annually. This regional demand is a potential export market. The relatively high costs of sea freight in combination with the fact that other vegetables oils are relatively more expensive make industrial production and processing of palm oil an economically viable option.
6 Con t In 2005 production was 30,000 tons (IFC figure) to 42,000 tons (USDA figure), all consumed locally, with another 7,000 tons of refined palm oil imported from South East Asia. ECOWAS, West African nations as a whole imported 308,000 tons in 2007, so there is clearly already a large unmet regional demand for palm oil. The post- conflict reconstruction of the oil palm sectors offers major opportunities for introducing international best practices to be designed in from an early stage.
7 PRODUCTION POTENTIALS The favorable agro-climatic conditions of Liberia ensure that the potentials of the oil palm sector are quite impressive compared to sub regional sectors with poorer soils and significant moisture deficits. with the right investments and industrial management approach, the Liberian Oil palm Sector is capable of easily producing 18Mt to 20Mt of FFB per hectare.
8 Basic Facts about Liberia s Oil Palm Sector Virtually all production in small-scale community-based farms widely dispersed through the country, with very low yields on largely unmaintained and aging trees. Current estimated direct employment & income impacts about 40,000 families. Industrial estates almost entirely shut down or abandoned during the conflict era of Highly unreliable data indicates total output about 183,000 tons of fresh fruit bunches (FFB), or 44,000 tons crude palm oil (CPO), currently valued at around US $30 million at current world prices Industrial post-harvest facilities were all closed during the height of the conflict era. Liberia is a net importer of about 11,000 tons palm oil per year, with regional irregular trade and no food-grade exports.
9 LARGE SCALE OIL PALM EXPANSION IN LIBERIA Golden VerOleum(Liberia) Inc., a subsidiary of the Verdant Fund Lp whose major investors include Golden Agri- Resources Ltd entered in to a concession agreement with the Government of Liberia for the development of oil palm plantation in Sinoe, Grand kru, Maryland, Rivercess and River Gee Counties in Southeastern Liberia. The signed and ratified concession agreement which was awarded to GVL covers a total of Approximately 500,000 acres (220,000 hectares). a Liberian smallholder program is to develop 100,000 acres (40,000 hectares) of oil palm in support of local Liberia oil palm initiatives. GVL has decided to initiate this large-scale oil palm plantation by beginning with the cultivation of 33,000 ha of land in three districts of Sinoe GVL has already obtained a provisional permit from the Environmental Protection Agency (EPA) for the establishment of a 50 acres nursery,
10 SIME DARBY The Liberian Government in a 63 years concession agreement with Sime Darby provided 120,000 hectares of land in three counties (Bomi, Cape Mount and Gbarpolu) for the planting of oil palm. The government promised to make available additional 100,000 hectares of land. An estimated one million oil palm seedlings are on nurseries waiting to be planted.
11 Potential Oil Palm Investment Outcomes Create over 90,000 workplaces within the investor company operations Create improved incomes for over 30,000 Liberian smallholder/out grower families Produce million tons Crude Palm Oil (CPO) per year Company revenues of US$800-1,200 MM per year Generate substantial tax revenues and financing for an oil palm development fund
12 National Level Recommendations Create a national Sustainable Palm Oil Working Group with support from local RSPO members (ie., FFI, CI, Sime Darby, Equatorial) Mobilize government, private sector and NGO/civil society participation in the WG to address land use planning, biodiversity/ghg conservation, smallholder integration and other key issues. Develop a National Interpretation (NI) of the RSPO Principles and Criteria (P & C) in cooperation with the Ghana NIWG to enable certification and CSPO marketing. Support the Liberia Oil Palm Sector Strategy with government (MOA, EPA, FDA, and IBL) support and private sector leadership (OPAL, domestic companies, and MNCs)
13 Photos of the Oil Palm study tour to Indonesia and Ghana
14 LIBERIA OIL PALM ADVISORY WORKING GROUP (LOPAWG)
15 MEMBERS SO FAR Government MOA FDA EPA Civil Societies INGOS (FFI, CI, IUCN ) NGOS (AACC, Green Consulting PRIVATE SECTORS OIL PALM COMPANIES SIME DARBY GOLDEN VEROLEUM EQUATORIAL OIL PALM Investors IFC Solidaridad
16 PHOTOS
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21 CONCLUSIONS Palm oil industry expansion in Liberia brings major potential economic benefits in the form of revenues, employment, and investments, but the threat of forest conversion and biodiversity losses requires strong cooperation between, industry and NGOs. Toward this end, Liberia has significant potential in promoting sustainable practices and selling higher value certified products since all the companies with established concessions are members of the international Roundtable on Sustainable Palm Oil(RSPO).
22 THANK YOU VERY MUCH FOR YOUR ATTENTION
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