Indonesia To Set-up Green Palm Body in May

03/05/2011 (Reuters) - Indonesia will form a body to manage, monitor and clarify its mandatory green palm oil industry scheme within two weeks, an agriculture ministry official said.

The agriculture ministry said last month that it planned to issue Indonesian Sustainable Palm Oil (ISPO) certification to cover the entire operations of planters amid pressure from green groups to halt deforestation.

In January, Indonesia, the world's top palm oil producer, said it would trial its ISPO certification, covering the operations of planters.

"We have been appointing a team to prepare the formation of the ISPO organization," Gamal Nasir, director general of plantations at the ministry, told Reuters.

"We hope the team can accomplish their task -- to form the organization -- in one to two weeks from now."

Gamal added that the government would appoint an ISPO commission, consisting of officials from government institutions and ministries, palm oil associations and NGOs.

The ISPO commission will manage the certification system, and be tasked with giving ISPO approval and recognition to plantation companies being managed in a sustainable manner.

Such firms should also be co-operating with both local and international bodies that encourage sustainable palm oil, he added.

The Roundtable on Sustainable Palm Oil (RSPO), which groups planters, green groups and consumers, is the only other major group to have set up green standards for the whole industry.

But unlike RSPO, which does not impose sanctions on members that violate its voluntary standards, those found to be breaking ISPO rules will be punished by law, a ministry official said in November.

Earlier this year, the new secretary general of the RSPO described the ISPO as "excellent" and said it would compliment the RSPO.

Some major palm oil consumers such as Unilever (UNc.AS) stopped buying palm oil from Indonesian firm SMART because of concerns over deforestation, while a planned Indonesian moratorium on new permits to clear forests may slow industry expansion.

Sustainable Palm Oil