With the Government imposing a ban on regional plantation companies (RPC) on cultivating oil palm seeds for over 11 months, the companies are predicted to incur a loss of Rs. 400 million. According to the RPCs, oil palm plants are currently sitting in nurseries and any delay in planting these before the northeast monsoon rains commence would mean that the entire value of the plants will have to be written off. The livelihood of the farmers assigned to work in these cultivations will be impacted over the coming months, as they have by now prepared to uproot the rubber trees from the plantation lands and prepared the land for oil palm cultivation. Coconut Research Institute (CRI) Principal Entomologist Dr. N.S. Aratchige in 2017 indicated that the cost of production per kilogramme of palm oil was Rs. 274.18 on the fourth year of the yield, and by the fifth year, it decreased to Rs. 166. “If Sri Lanka is to produce its own palm oil, the country could offset foreign exchange expenditure amounting to Rs. 7.9 billion. The requirement can be achieved by growing 20,000 hectares of oil palm plants, which will return an annual production capacity of four metric tonnes per hectare,” she said. The CRI also noted that the land equivalent ratio, which indicates the efficiency of land use in palm oil compared to coconut oil, was around 4.6 to 4.7, indicating that oil palm cultivation is a highly productive business. As recorded on the Elpitiya Plantations PLC Annual Report 2017/18, Sri Lanka imported 229,633 metric tonnes of edible oil and fats in 2017 at a cost of $ 46 million, of which palm oil was a key constituent. The growth of oil palm and the production of palm oil enabled total savings of Rs. 8 billion in 2017. The total extent of oil palm cultivated in Sri Lanka in 2017 was over 9,500 hectares and the two major players in local palm oil milling demonstrated equal production capacities of 45,000 litres per day that year. Time to diversify Former senior planter, visiting agent, and agricultural advisor Lalin I. De Silva, sharing his insights into the strategic management of plantations, pointed out that prior to the privatisation of RPCs, the Treasury had to pump Rs. 400 million per month to keep the plantations going in 1993. “The plantations industry today is contributing less than 2% to the GDP of Sri Lanka; the GDP of Sri Lanka is around $ 90 billion. Today, the industry neither attracts nor retains talent due to lack of affordability. In 1993, the direct workforce involved in the plantation sector was 300,000 and it has now come down to 140,000 employees. The per capita income within the industry is around $ 1,700 on average, while the per capita income of the country is around $ 3,900.” De Silva further explained: “Scientifically speaking, the time has come for the diversification of rubber lands into a new crop such as oil palm. In an economical sense, the employees in oil palm estates seem to be earning wages of around Rs. 60,000.” According to De Silva’s observations, an employee working in the oil palm industry would earn double the income of an average plantation employee. The industry is greatly fuelled by the smallholder sector in terms of production, but the RPC sector is important from the social security (employment) point of view. Strict regulations Ministry of Plantation Industries Additional Secretary – Rubber and Coconut Janaka Dharmakeerthi stated that the Ministry issued directives to the District Secretariats of Kalutara, Galle, Kegalle, Ratnapura, Matara, the Planters’ Association of Ceylon, and RPCs in August to take into consideration the recommendations put forth by the Central Environmental Authority (CEA) in their September 2018 assessment report. “The recommendations of the CEA to the RPCs were that any oil palm cultivations that received the approval of the Ministry should only commence cultivation in suitable areas as recognised, following a strategic environment assessment. Any land area that is found to be unsuitable for oil palm cultivation should be rehabilitated by planting suitable plants,” he said. Dharmakeerthi also stated that in addition, the natural expansion of the plantation should be mitigated, precautionary measures needed to be taken to halt the seeds from growing outside the stipulated area, and any sapling that is sprouting needed to be removed immediately by the plantation company. Furthermore, the respective district secretariat should appoint a district-level post-cultivation observance committee to study the current status of the oil palm cultivations in their areas. The committee is to include an officer from the Ministry, the respective divisional secretariat, CEA, Department of Agrarian Development, National Building Research Organisation (NBRO), and the respective grama niladhari officers. The RPCs are to present an environmental management plan for oil palm cultivation, which, prior to execution, should be presented to the committee appointed by the Ministry, which will assess the plan and the approved copy of it would be shared with the post-cultivation observance committee of the respective area. – Sarah Hannan