Sime Darby Plantation : Intan Hebat Baru and Wild Asia Join Forces to Raise Palm Oil Small Producers’ Standards

Sime Darby Plantation, Intan Hebat Baru and Wild Asia Join Forces to Raise Palm Oil Small Producers' Standards

• Parties ink 2-year Tripartite Agreement for the guaranteed uptake of Certified Sustainable FFB by SDP at a premium
• Intan Hebat and Wild Asia will ensure that the FFB supplied by small producers are sustainably produced and traceable from farm-to-mill

CAREY ISLAND, 29 November 2022:Sime Darby Plantation Berhad (SDP) has agreed to procure certified sustainable fresh fruit bunches (FFB) from a group of independent small producers in Carey Island, in the Kuala Langat district of Selangor, Malaysia, for two (2) years commencing 25 November 2022. The small producers, including some farmers from the Mah Meri tribe who reside on the island, are represented by Intan Hebat Baru Sdn Bhd (Intan Hebat). They are certified under a sustainable palm oil scheme organised by the social enterprise, Wild Asia Sdn Bhd (Wild Asia).

This scheme, known as the Wild Asia Group Scheme (WAGS), is a management system founded in 2013 to provide technical and management support for smallholders to have their production independently certified. It also helps to improve farming practices of these smallholders and to support them with meeting compulsory sustainability standards, in compliance to those set by the Malaysian Sustainable Palm Oil (MSPO) as well as the Roundtable on Sustainable Palm Oil (RSPO) voluntary certification scheme so that they can participate in the global sustainable palm oil value chain. Small producers are classified as smallholders (with a total farm area of less than 40ha) while small growers are those with total farm area of more than 41ha and less than 500ha.

Under a tripartite agreement, all three parties also commit to jointly ensure the traceability of palm oil produced by the independent small producers. By procuring FFB from WAGS-certified small producers at an agreed premium, SDP will be supporting and promoting their inclusion into its sustainable supply chain, whilst Intan Hebat will in turn ensure clear traceability of the FFB from farm to SDP's mills. In support of Intan Hebat's traceability reporting and journey, Wild Asia will be working closely with Intan Hebat to trial the most appropriate traceability system.

SDP's Chief Sustainability Officer, Rashyid Redza Anwarudin said, smallholders are a critical part of the global palm oil production, accounting for about 40% of the world's supply, as such, initiatives that can help to increase their participation in sustainable supply chains should be supported by bigger players in the industry with the right credentials.

"As the world's largest producer of certified sustainable palm oil, one of Sime Darby Plantation's top priorities is to promote the responsible production of certified sustainable palm oil to as many stakeholders as we can. The inclusion of WAGS-certified small producers' into our sustainable supply chain will contribute to the livelihoods of these small producers and signal to many others that they can continue to make a living by choosing to produce palm oil more responsibly and sustainably," said Rashyid.

He added that SDP also runs its own extensive smallholder programmes in Malaysia, Indonesia, Papua New Guinea, and the Solomon Islands where its operations are located, helping more than 52,000 small and independent farmers get their plantations sustainably certified under both compulsory national schemes and the RSPO voluntary scheme.

"Today's agreement marks another significant milestone for furthering the agenda of sustainable palm oil in the supply value chain. At Wild Asia, our tagline 'business for good' encapsulates our goal and mission to bring about social and environmental change within the palm oil industry through better solutions, inclusion, and compliance to progress toward traceable and certified palm oil," said Dr Reza Azmi, founder and executive director of Wild Asia.

"One of our missions is to create better livelihoods for the smallholders through higher yields and better profits once they are able to meet the international standards and demands of sustainability. This new purchase agreement will not only promote a fair benefit share of RSPO premiums to the producers and dealers but also encourage more smallholders to join WAGS as the first step toward RSPO certification," he added.

"Following today's signing, I look forward to recruiting more smallholders to sign up with WAGS and in encouraging more of them to participate as an RSPO supplier that also supports their long-term sustainability to supply to large corporations like Sime Darby Plantation. We will be sure to invite Wild Asia again for the certification process by that time," said Ang.