Wednesday, September 21, 2016

Asia Pulp & Paper denial shown to be false

 In contradiction of the denial issued by Asia Pulp and Paper (APP) stating that PT BMH is not a subsidiary of APP or the Sinarmas Forestry group, as was reported by Mongabay, legal documents officially submitted by PT BMH to the Environment and Forestry Ministry show that the company is indeed a subsidiary of the Sinarmas group.

In light of this, sent an email to APP and Sinarmas Forestry asking whether they would be willing to respond, confirming the veracity or lack thereof of the legal documents, if the documents in question, which were in the possession of, were emailed to them.

However, by time of the deadline provided had yet to receive any response from APP or the Sinarmas Forestry group.

In these official legal documents, PT BMH declares that it is part of and incorporated with the Sinarmas group. What’s more, PT BMH also writes that it is one of several subsidiaries of the Sinarmas group.

In one of the legal documents, PT BMH itself writes that it, along with several other subsidiaries of the Sinarmas group, has successfully developed pulpwood plantations in peatlands. PT BMH even goes on to claim that it has harnessed advanced technology for managing pulpwood plantations in peatlands.

PT BMH, more specifically, describes itself as a company which forms part of the Sinarmas group in the Palembang region, together with PT BAP and PT SBAWI. The legal documents even state that these companies are coordinated by the Forestry Operational Division Head.

The matter extends beyond just PT BMH. In a legal document from PT BAP, whose concession adjoins that of PT BMH in the Ogan Komering Ilir (OKI) regency of South Sumatra province, the company writes that it supplies pulpwood plantation fiber to pulp and paper mills belonging to the Sinarmas group, which at the same time serves as its parent company.

In line with the legal documents of PT BMH and PT BAP, PT SBAWI also acknowledges that it is in the same group as the two other companies. PT SBAWI’s concession is also located next to those of PT BAP and PT BMH.

The legal documents of these three companies are mostly made up of operational plans that they have submitted to the Environment and Forestry Ministry. The Minister of the Environment and Forestry has issued a decree to authorize operational plans that are formally proposed by pulpwood companies, such as that of PT BMH.

It seems rather strange in legal sense that, after these companies have admitted to being subsidiaries of the Sinarmas group - as stated by the companies themselves in the official legal documents - and after having their operational plans approved by the minister, APP made a public denial of these legal facts.

PT BMH and PT SBAWI previously had their permits suspended by the Environment and Forestry Minister due to the massive peat fires that occurred in their concessions last year. PT BAP also experienced huge peat fires in its concession.

One of the main factors taken into consideration by the minister in suspending the permits of these companies, in particular those of PT BMH and PT SBAWI, was that the peat fires in their pulpwood concessions caused serious air pollution in the form of haze which led to widespread suffering by the public in affected areas.  

The pulpwood concessions of the three companies are situated in a very broad expanse of peatland, totaling more than 580,000 hectares - about eight times the size of Singapore. There are also significant peat domes found in the three concessions.

Last year, there was a high concentration of peat fires in this broad expanse of peatland, and it is thus not surprising that OKI regency was designated by President Joko Widodo as a priority regency for peat restoration.

Wednesday, April 20, 2016

New Indonesia mill raises doubts about APP's forests pledge

Indonesia (AP) — A landmark commitment by one of the world's largest producers of tissue and paper to stop cutting down Indonesia's prized tropical forests is under renewed scrutiny as the company prepares to open a giant pulp mill in South Sumatra.

To fanfare more than three years ago, Asia Pulp and Paper promised to use only plantation woods after an investigation by one of its strongest critics, Greenpeace, showed its products were partly made from the pulp of endangered trees.

Greenpeace welcomed the announcement as a breakthrough and the company, long reviled by activists as a villain, rebranded itself as a defender of the environment, helping it to win back customers that had severed ties. At the same time, it was pressing ahead behind the scenes with plans to build a third pulp mill in Indonesia.

When it went public with its plans for the OKI mill in 2013, APP announced it would produce 2 million tons a year and then earlier this year acknowledged the mill's capacity could in the future increase to 2.8 million tons.

New research released Wednesday by a dozen international and Indonesian environmental groups estimates that APP will face a significant shortfall in its supply of plantation-grown wood after the new mill begins operating, even at a 2.0 million ton capacity. The company could then face a choice between using higher-cost imported wood or looking the other way as its suppliers encroach upon virgin forests.

"APP, while it has been presenting itself as a champion of zero deforestation, is building one of the world's biggest pulp mills," said Christopher Barr of Woods & Wayside International, one of the organizations involved with the report.

"There will be a great deal of pressure to ensure it receives adequate supplies of wood to keep it operating at full capacity," he said. "Our analysis shows the group's existing planted area in South Sumatra is unlikely to produce the volumes of wood the mill is expected to consume at projected capacity levels."

How the mill, which could operate for more than half a century, is fed will be a factor in the survival of Indonesia's tropical forests and the endangered wildlife they shelter. More generally, the draining and destruction of peatlands for forestry or agriculture will over decades release vast amounts of carbon that could jeopardize Indonesia's ability to meet its emission reduction targets under an international agreement due to be signed within days.

The report estimates that APP's plantations in South Sumatra have never produced half of the wood needed to feed a 2.0 million ton a year pulp operation. That shortfall is compounded by devastating forest and peatland fires across Indonesia last year that destroyed more than a quarter of APP's planted trees in South Sumatra, according to an on-the-ground survey by Hutan Kita Institute and other civil society groups.

The company said it would it respond to concerns about the mill.

APP is the crown jewel of the Sinar Mas conglomerate, one of Southeast Asia's largest companies. For a time it was a pariah in financial markets after defaulting in 2001 on $13.9 billion of debt, which still ranks as the biggest default by a company from a developing nation. It has secured Chinese funding for the OKI mill.

The draining of peatlands, which make up the bulk of the concession land in South Sumatra that supplies APP, is a fraught issue for Indonesia's neighbors. Record fires on peatlands and forests last year caused $16 billion of losses for Indonesia, according to the World Bank, and sent a smoky, health-damaging haze across the country and into Singapore, Malaysia and Thailand.

The mill and its plantations, meanwhile, affect the livelihoods of thousands of people who have lived for decades on land used by APP. The company is embroiled in hundreds of land use conflicts across Indonesia and has yet to reach an agreement with any community after vowing to settle such disputes in 2013

Once the new mill begins operating, "I think it will be even more difficult for communities to get their land back" said Aidil Fitri, of Hutan Kita Institute, which is advocating for two communities in conflict with APP in South Sumatra.

"Now they have OKI mill and we believe they need more lands for their plantations," he said. "On the other side, the communities who have conflicts with APP need their lands back for their livelihood, to do agriculture, not for acacia plantations."

Greenpeace forests campaigner Andy Tait said APP has maintained it will only supply the mill with plantation or imported wood. But he acknowledged that APP's assessment that its plantation wood supply is adequate predates last year's "horrendous" fires, which heavily affected the company.

"We don't see any sign of APP pulling back from its commitments on no deforestation at this stage and it would obviously be commercial suicide for them to do so," he said. "But this mill construction raises a number of critical questions that need to be addressed."

Friday, March 11, 2016

APP new mill, WWF has serious doubts about adequate fiber supply.

An article published on Bisnis Indonesia daily, report APP plans to increase the production capacity of its new OKI pulp mill in South Sumatra from 2 millions tons to 2.8 millions. "We are not convinced that the raw material supply for the OKI mill will be sufficient". commented Aditya Bayunanda, of WWF-Indonesia to "Even before it was announced that the annual production capacity of the new APP mill would be increased, we already had serious doubts as to whether there would be an adequate fiber supply. Our doubts are greater than ever now that APP plans to increase the mill’s production capacity" "They always claim that if indeed the supply turns out to be inadequate, they will make up the shortfall through imports. However, importing acacia is not that simple. It’s not as if there is a ready stock stashed away somewhere. It’s not easy to import acacia, especially in large quantities," added Aditya.
APP claimed that an independent study confirmed that the group has sufficient plantation resource to meet the pulp requirements of its existing mills as well as its future mill in OKI, South Sumatra. However, the study has never been made public, and the Rainforest Alliance, which was responsible for auditing it, noted that “a definitive answer of whether APP has enough plantation wood supply based on estimates from data gathered and analyzed 1.5 years ago is not possible”. The auditor added that the study only confined its scope for the period to 2020, giving no information about the future wood supply.
Recently, a coalition of Indonesian NGOs from South Sumatra released a report revealing that 26% of APP’s total planted area in the province has been lot in the forest fires in the province only.

Thursday, February 18, 2016

Forest People Programme: APP fails the grade

Three years after the launch of APP's Forest Conservation Policy (FCP) – which was introduced at the beginning of February 2013 – the company’s lack of progress in implementing the policy continues to put it firmly in the sights of both Indonesian and international CSO groups.

One international CSO, Forest Peoples Programme (FPP), says that APP had failed the grade during the first three years of FCP implementation, especially as regards APP’s performance in resolving social conflicts related to its operations and those of its suppliers, at least in the three years since the FCP has been implemented.
"APP made a commitment three years ago that it would respect community rights and resolve conflicts with them. In the three years since that commitment, it has made a small amount of effort and it has not fully resolved any of the conflicts," Patrick Anderson, FPP's Policy Advisor to Indonesia, told on last Wednesday (Feb 10) in Jakarta.

He was responding to questions from on the extent to which APP had successfully managed to address social conflicts during the three years of the FCP’s implementation. Patrick said that his organization was disappointed with the implementation of the FCP over the last three years, in particular as regards its capacity to address social conflicts related to APP’s operations.
He also said that APP had only achieved a little progress in resolving conflicts related to community rights. "For APP to the make change, they need to recommit and they need to put significant resources into this, and they need to make clear what are the steps they will take for resolving conflict," added Patrick.

As an example, he pointed to the participatory mapping process that maps the areas of the communities, including their customary lands. That process, Patrick said, includes redocumenting what were the economies, livelihoods, their cultural values that were damaged when they became acacia (pulpwood plantations) so that these things can become part of a negotiation for compensation.
Patrick stressed that APP needed to publically commit and to make a big investment from their own staff and management time, and to take issues related to community's rights seriously. Otherwise, he said, these conflicts will go on and on. "I'd give them (APP) a failed grade if I look at what they have managed in three years. It's a very small effort considering the size of their problem," Patrick said.
In a press release issued to mark the third anniversary of its Forest Conservation Policy, APP said that during 2015 it had continued to work to resolve social conflict in its supply chain, while also strengthening the implementation of its Free Prior and Informed Consent (FPIC) policy.

Thursday, February 04, 2016

APP policy 3rd anniversary

During  an event at the Grand Hyatt Hotel Jakarta, Asia Pulp and Paper released today its Forest Conservation Policy Report
According to the company, the report reveals accelerated progress in peatland management:
  • More than 3,500 canals blocked as Peatland Best Practice Management Project accelerated
  • Agroforestry programme rolled out to improve community welfare while supporting protection of natural forests in the supply chain 
  • Belantara Foundation, initiated by APP, ready to manage and fund conservation projects in Indonesia 
  • Fire prevention measures strengthened with implementation of new Integrated Fire Management Strategy
Comments by NGOs however are more skeptical. While they recognize the effort by APP to improve forest and peatland management, land conflict and social issues, and landscape conservation and restoration, according to NGOs implementation on the ground reveals major failure. 

A coalition of Indonesian NGOs from South Sumatra released a report revealing that 26% of APP’s total planted area in the province has been lot in the forest fires in the province only. 
The report raises serious questions about how this significant plantation loss will influence the fiber supply for APP’s new mega-scale pulp mill, PT. OKI (2,5 tonnes pulp per year), which the company has announced will start operation later in 2016. APP never made public the report stating they ave enough fibre to feed the new mill, but the Rainforest Alliance, that could review it well before the fires, noted that the “a definitive answer of whether APP has enough plantation wood supply based on estimates from data gathered and analyzed 1.5 years ago is not possible”.

The NGOs coalition (Hutan Kita Institute, WALHI South Sumatra, Pilar Nusantara, LBH Palembang, Jaringan Masyarakat Gambut - South Sumatra, FKMPH, LSM BAKAU and Rimba Institute) demand APP to release detailed results of its “verification” of burned areas, to fully restore burned land to natural ecosystems, to rewet al the peatlands in its concessions to reduce the fire risk, to resolve all outstanding conflicts with communities, and finally to conduct and share a new, comprehensive assessment of short and long term fiber supply that considers the fiber requirements of both its existing mills and the new OKI mill functioning at full capacity. , 

"APP must indicate where it intends to source fiber for its existing mills and the new OKI mill if its plantations in Sumatra cannot produce sufficient fiber. The company has only provided ambiguous responses to this question, saying that it would find “other sources” or “import” wood. The company should reaffirm its commitment not to use any mixed tropical hardwood fiber in its mills” says the document, which also ask the government to conduct environmental audits, review licenses, and follow up any legal violations with appropriate law enforcement.

Rainforest Action Network (RAN) also noted "the lack of improved outcomes on the ground for local communities, forests and peatlands and forest governance belies APP’s narrative that it has turned itself around and deserves to be rewarded”.
The brutal killing of the 22 year old farmers union organizer Indra Pelani by APP related plantation company security, the forest tire that ravaged across APP concessions contributing to the toxic smoke and haze that caused a public health crisis and the too little step to assure peat protection (an admirable commitment to set aside of 7,000 ha of peatlands for restoration, but not sufficient steps to protect peat in the remaining 99 percent of APP’s holdings in peatlands) show that the there is still much to do. "The legacy of twenty years of rogue operations is taking more time to address than APP wants paper buyers, investors, governments and industry watchers to know about” 

“Due in large part to a failure to adequately identify, delineate and set aside indigenous and community lands and land claims, APP has a continuing legacy of social conflict and inequity across its concessions” - added RAN - “These events and findings paint a picture of a company with a long way to go before it may be considered even a non-controversial company, let alone a socially and environmentally responsible one.
RAN demanded a new independent audit on APP implementation, based on credible criteria.

Tuesday, December 22, 2015

Forest fires: more APP plantations licenses suspended

Indonesia is punishing more than 20 companies in an unprecedented move for starting deadly forest fires that killed 19 people, a government official said Tuesday. The companies - most of them pulp wood plantations operating on concession land in Sumatra and Kalimantan - have had their business licences suspended. The firms include BMH and SWI, which have concessions in South Sumatra. BMH is a supplier to Asia Pulp & Paper (APP) in Indonesia. BMH, SWI and APP have the same parent company, the Sinar Mas Group. The suspensions would be lifted if, within the next two years, the companies show that they have made significant progress in efforts to prevent future fires.

Three more companies have been shut down permanently after having their licences revoked over their role in the blazes that choked vast expanses of southeast Asia with acrid haze and cost Indonesia $16 billion. among them Mega Alam Sentosa (MAS), another Sinar Mas controlled company.
It is the first time the government has revoked company licences over forest fires, an annual occurrence caused by slash-and-burn land clearance.

Several other companies have been given a strong warning and will be put under close supervision. "We have sanctioned 23 companies in total, ranging from administrative sanctions to license revocation, while 33 others are still in the process, they could have their licenses revoked too if they are found guilty," environment ministry official Kemal Amas.

The ministry has been investigating 276 companies in total since the fires broke out in September.
"We need firmer law enforcement so that this catastrophe does not repeat itself, it’s been going on for 18 years but nobody has learnt their lesson," Amas said.
Activists welcomed the government’s new commitment to punish firms. The Indonesian Forum for Environment (Walhi) said it was unheard of for the government to revoke licences, as many companies previously avoided facing trial. "The minister has the courage to not only freeze the companies' operation but also chase the owners in a civil case, this is great and this must be guarded carefully," Kurniawan told. "In the past some people were named suspects, but for them to actually lose their licenses, this is the first time," he said.

More than half a million people suffered acute respiratory infections in Indonesia because of the haze, while many in neighbouring Singapore and Malaysia also fell ill.

Friday, December 11, 2015

New report: drained plantations on peat in the Kampar Peninsula cannot be sustained

A new Deltares report, commissioned by Wetlands International, reconfirms that pulp wood and oil palm plantations in peatlands cannot be managed sustainably. Such drained plantations will inevitably suffer from severe land subsidence, increasing flooding and eventually production loss. The report also provides evidence that fires only occurred in drained peatlands and therefore inside or near plantations.

Independent science institute Deltares assessed the impacts of peatland drainage for plantations on the Kampar Peninsula peat dome, which probably is the largest single peat dome in Sumatra and Kalimantan, using the latest remote sensing techniques and scientific understanding of lowland peatland response to drainage.


Modelled likely flood extent (HWL) and drainability (FDL) for (right) 2014 and for (left) 50 years after 2014.





Current (2014) extent of Acacia and oil palm plantations on Kampar Peninsula, and 2010 concession boundaries



According to Wetlands International, pulp and paper companies APP and APRIL, which hold the largest concession areas on Kampar Peninsula, need to phase out their drainage-based pulp wood plantations from peatlands and rewet the areas that they drained for their plantations, to avoid floods and large scale loss of land productivity and to curb fires. Sustainable alternatives on rewetted peatlands need to be developed.

At an ASEAN side event during the UNFCCC CoP21 in Paris, Marcel Silvius, Head of Climate-smart Land-use of Wetlands International said: “I am surprised that the peatland subsidence and flooding issue is not considered in the ASEAN Haze Strategy and in national land-use policies and planning in Indonesia and Malaysia. The consequence of millions of hectares of peatlands becoming unproductive will likely increase fire risks in these areas during dry periods for many decades to come. By then it will be too late to restore them”

There are regular claims from the pulp wood industry that peat loss and subsidence can be curbed by using improved water management techniques. But the report underscores that such techniques, including the ‘eco-hidro’ peatland management model developed by APRIL, can only reduce the rate of subsidence and by not much more than 20%.

Another finding is that despite that most companies in the area have no-fire policies, 99% of the numerous fire hotspots that occurred on Kampar Peninsula over the last 15 years were in plantation areas. This clearly shows that even the largest companies have not been able to prevent or control fires. 

Extent of 2014 pulp and oil palm plantations and fires in the study area.




APRIL claims that by developing their Acacia pulp wood plantations in a ring-shaped area covering most of the outer margin of the Peninsula, they help to protect the forested inland parts of the Peninsula. However, drainage and subsidence inevitably affect the hydrology of the adjacent areas which are part of the same hydrological system, enhancing the fire risk in remaining natural forest and peat areas. The research covered an area of 674,200 ha. By 2014, almost half of the area (43 %) was converted to plantations, predominantly (71.7 %) to Acacia plantations for the pulp and paper industry. The plantations also threaten biodiversity, including a population of the endangered Sumatran Tiger and cause the release of vast amounts of carbon emissions as a result of peat drainage.

Wetlands International points out that peatlands can be cultivated with crops that are adapted to the wet soil conditions – a practice known aspaludiculture, which can provide a sustainable resource for industry and deliver economic prosperity to local communities. This and other recommendations are included in a Roadmap towards sustainable peatlands management for the Indonesian pulp industry, recently developed by Wetlands International and Indonesian civil society partners.

The organisation also recommended the Indonesian government to develop aNational Peatland Conservation and Restoration Strategy to curb the fires and haze disaster, carbon emissions from peat and flood risk. The Indonesian government plans to form a Peatland Restoration Task Force and develop regulations to improve peatland management and curb peatland fires, greenhouse gas emissions and haze. Wetlands International also calls upon the Indonesian government to review current and new policies in light of new scientific evidence of peatland subsidence and flooding.