Palm oil industry optimistic on cultivation ban reversal

 POIA COO Yajith De Silva, Treasurer Ravi Jayathilake, Vice President Sajjad Mawzoon, High Commissioner of Malaysia Budli Hisham Adam, POIA President Rohan Feranando, Ambassador of Indonesia Devi Gustina Tobing, POIA Vice President Bhathiya Bulumulla and Ceylon Chamber of Commerce Assistant Secretary General - Legal Oshadhi Kodisinghe

Pic by Pradeeep Pathirana

• Says new government’s focus on agriculture and poverty alleviation raises hopes for reversing ban
• Points out Sri Lanka is the only country in the world that restricts oil palm cultivation but allows its consumption
• Says country could have met 50 percent of its edible oil demand by 2025, if not for the ban

By Nuzla Rizkiya

Sri Lanka’s palm oil industry sounded optimistic on the possibility of having the ban on oil palm cultivation reversed as one of the key focuses of the new government is agriculture and poverty alleviation. 

With Sri Lanka being the only country in the world that bans oil palm cultivation but allows its consumption, Palm Oil Industry Association (POIA) President Rohan Fernando stated that the local industry is hopeful that the government would soon realise and rectify the inconsistency of the policy.

If not for the ban, Sri Lanka would have been able to cater at least 50 percent of its edible oil demand by 2025, according to Fernando who also noted that the country currently spends a staggering US$ 57 million on edible oil imports.

Sri Lanka consumes 220,000 metric tonnes of palm oil per annum of which only 12 percent is produced locally on a land area of 12,000 hectares, according to the POIA.

“If the ban is lifted, we could start importing seeds, but it will take another year to import them and at least another three more years for them to grow,” Fernando told Mirror Business at the association’s 5th AGM held recently. “We are yet to approach the government formally, but we are hopeful that they will look at it positively as they are encouraging domestic cultivation, poverty reduction and agriculture,” he added.

Sri Lanka banned oil palm cultivation after what Fernando described as an “ill-conceived but knee-jerk decision” made in April 2021 by then President Gotabaya Rajapaksa, which stopped new plantations and uprooted existing ones.

The restriction was primarily fueled by the misconception that oil palm plantations have a higher water footprint which could potentially impact the output of other crops nearby.

“We have time and time again proven beyond reasonable doubt that there is no scientific truth to these allegations. If there were any truth, then countries like Malaysia and Indonesia who benefit from 15 million hectares of land for palm oil cultivation, would be deserts by now,” Fernando said.

He further went on to stress that the prolonged ban is creating an unhealthy reputation for Sri Lanka in the Asian region, especially at a time when close by countries such as India are taking concentrated steps to expand their cultivation exponentially.

Fernando shared that the Indian government under the leadership of Prime Minister Modi has begun working on an accelerated expansion programme of oil palm cultivation that would help the economy capture a good portion of Asia’s 40 percent supply market to the global demand.

Moreover, given Sri Lanka’s shortage in agri production along with its issues such as unemployment and low income among smallholder farmers, he opined that the country is losing out on a lucrative avenue that could immensely contribute to tackle such prominent issues.

“Currently duty has been reduced on coconut oil imports and we all know that productivity of oil palm is almost four times that of coconut oil”.

“Had oil palm cultivation been expanded, Sri Lankan coconut products could have been exported, earning valuable foreign exchange to the country. So we are hopeful that the new government will take these decisions in a rational manner and lift this unfortunate ban as a country where limited land is available,” Fernando said.