Regenerative Agriculture Practices in Preventing Deforestation and Land Conversion in Indonesia
Olivier Tichit is the Director of Sustainability of Musim Mas Group, based in Medan (Indonesia). Musim Mas is a major integrated palm oil company and a leader in sustainability. Olivier oversees the implementation and execution of Musim Mas’ sustainability plan. His role includes reviewing the Group’s sustainability policy and strategy, as well as working with the Group’s key customers to identify synergies for enhancing palm oil’s sustainability proposition in the world commodity sector.
Musim Mas is an active member of the Roundtable for Sustainable Palm Oil (RSPO), where Olivier serves as an alternate member of the Board of Governors, and as co-chair of the Standing Committee for Standards. Olivier is a member of the High Carbon Stock Approach Executive Committee, where he serves as Treasurer. He is also a member of the Board of the Indonesian Palm Oil Producers Association.
A tropical agronomist by training, Olivier has worked in South-East Asia for the past twenty years. Olivier was formerly the Commercial and Sustainability Director of the Indonesian subsidiaries of SIPEF, a Belgian plantations group. Before joining SIPEF, Olivier was the Indonesia Country Manager for a major commodities merchant group, Ecom Agroindustrial, and spearheaded sustainable certifications for coffee smallholders. Olivier is active in the Roundtable on Sustainable Palm Oil (RSPO), the High Carbon Stock Approach (HCSA), and the Palm Oil Innovation Group (POIG).
1. Present in 13 countries, Musim Mas is one of the largest integrated palm oil corporations. Do share with us Musim Mas’ background and history.
In 1932, we began in Medan, Indonesia as the Nam Cheong Soap Factory where we manufactured and distributed quality soap products to local and international markets. Our humble beginning is a testimonial to the hard work that has borne fruit through the decades by our dedicated workforce. We have always taken pride in our values of hard work, determination, and persistence to make anything possible. A simple bar of soap has led us to the global position we hold today.
1970 – 2004 Setting a Strong Foundation for Growth
We made our foray into the palm oil industry with investments in a palm oil refinery, plantation, kernel crushing plant, and palm oil mills in this era. One of our proudest moments came in 2004 when PT Musim Mas became the first Indonesian company to become a member of the Roundtable on Sustainable Palm Oil (RSPO). Musim Mas Chairman served on the first RSPO Executive Board.
2007 – present
While we capitalized on the growing Asian market, Musim Mas began to establish operations around the world including Europe and North America. With our roots firmly established, our business spread to India, China, Vietnam, the Netherlands, Spain, Italy, and Brazil. Today, Musim Mas is Indonesia’s largest palm oil exporter to customers located all around the world.
We are very proud of our focus on sustainability with recognitions from around the world: Musim Mas Group became the first major group to achieve 100% RSPO P&C certification for all our mills with plantations; PT Musim Mas was the first company to receive the Indonesian Sustainable Palm Oil (ISPO) certification, and Musim Mas Group was the first company in Southeast Asia to attain Palm Oil Innovation Group (POIG) verification in 2019.
2. With sustainability as the core value, briefly explain how Musim Mas integrates sustainability into its refining and
We are a fully integrated company with operations upstream and downstream. We are very fortunate that our Chairman was very involved from the start, to the point that he went to the RSPO, and sat on the board, almost 20 years back. We have strong governance at the top management level that truly believes in the necessity of sustainability. This means that sustainability has become the norm within the sustainability of our operations and is embedded throughout our company.
What is interesting is that while we have the Sustainability department, each department (like the Operations Team, Estates Team, or Procurement Team) has its own sustainability specialists, with its sustainability functions. This means they are not just waiting for the Sustainability department/team to tell them what to do. They own the process of implementing sustainability, which is very important since it gives a sense of ownership where each team implements Sustainability.
This is especially helpful as this means they can adapt and they can feedback to us on what works or what doesn’t work. It is an inclusive and integrated process as we can tell them about a new sustainability initiative, and their team can suggest what works better on the ground. At the end of the day, we want to make it practical for the teams on the ground to implement sustainability, and not something that will place more pressure on them.
3. Do share with us Musim Mas’ project in regenerative agriculture with other big brands. What are the aims and goals of this project?
Musim Mas has recently embarked on an unprecedented, ten-year-long large-scale sustainable palm oil project with the Livelihoods Fund for Family Farming (L3F). The project aims to build a transparent and deforestation-free supply chain based on locally adapted agroforestry models, regenerative agriculture, and biodiversity enhancement. It is a first for Musim Mas and possibly the entire palm oil industry. You can read more about L3F at this link here - https://livelihoods.eu/l3f/
The program will introduce regenerative agricultural practices and replanting with certified seedlings to smallholders to improve crop yields and reduce total planted area. It will study the use of non-palm species to restore buffer zones in fragile ecosystems. The program will also explore other approaches to improving farmer resilience and autonomy, including diversifying crops through intercropping and agroforestry, improving soil fertility and regenerating soil health, developing integrated and biological pest control, and enhancing biodiversity.
In terms of aims, we hope to help 2,500 smallholder palm oil smallholders achieve sustainable livelihoods in North Sumatra, Indonesia, regenerate 8,000 hectares of palm farms in degraded land areas, while restoring an additional 3,500 hectares of local biodiversity over ten years. We strive to scale our learnings and experience after the program ends.
The program also brings together fast-moving goods companies Mars, Incorporated and Danone, and L’Oréal. These companies are long-time Musim Mas partners and L3F investors. Musim Mas will implement the program locally with SNV, an NGO that works closely with palm oil smallholders. The project will extend Musim Mas’ current smallholder initiatives and leverage our activities on the ground.
4. How does this project intend to promote non-palm agroforestry models? How does it serve as a buffer between palm farms and protected forests?
This project has just officially kicked off on 15 June 2022 in Rantau Prapat. As a new program, the exact details are being studied. One of the components is Agroforestry Demo Plot Development. As part of the implementation of the regenerative agriculture concept, the project will encourage and implement agroforestry models in smallholder plots.
Four agroforestry models will be developed, i.e., palm oil agroforestry (PO AF) with annual crops, PO AF with perennial crops, PO AF with ‘sisipan’ species- an approach of planting in the spaces between the palms, and PO AF combined with silvopastoral models which are plant growth combined with livestock. SNV will develop demo plots for all types in every village, including the nurseries.
5. In your view, how these collaborations can help independent smallholders’ lack of access to technical and operational knowledge, also financial resources?
Musim Mas initiated one of the most comprehensive collaboration projects to improve independent smallholder sustainability. In 2015, we launched our smallholder program with the International Finance Corporation (IFC), local governments, and banks. Starting with smallholders engaged at our mills, we later extended it to smallholders around thirdparty mills. Over 35,000 smallholders have benefited from these efforts.
To go even further, we broadened our efforts in 2020 to launch smallholder hubs where we train agricultural officers so that they can go on to train wider groups of smallholders, a train the- trained approach. We collaborate on a landscape level at these hubs, with district governments, NGOs, growers, and mills. We have since launched 6 smallholder hubs. Smallholders face a multitude of challenges.
Many lack land deeds and hence are unable to secure loans to obtain fertilizer and other resources needed to improve yields. Consequently, many suffer from poor yields. IFC research suggests their yields may be as much as 116% below company plantations in Indonesia. We take the view that collaborations are the way to help them gain legitimacy and resources and improve market access.
Collaborations should involve local and district governments, growers and mills, banks and financing corporations, and downstream players. Among other projects with downstream companies, The Livelihoods Project we detailed above involves downstream players such as Danone, L’Oréal, and Mars While many downstream companies are marketing sustainability, it has not percolated down to the producers. As a vertically integrated company, we hope to facilitate that collaboration to improve sustainability across the supply chain.
6. How do Musim Mas’ remote sensing capabilities come into the picture and assist in the land-use change, deforestation, and degradation of land?
Our Geographic Information System (GIS) team uses a combination of methods to monitor our operations and that of our suppliers. These include internal monitoring of concession maps and information provided by these suppliers, relying on a service provider, Earthqualizer’s satellite monitoring platform (previously Aidenvironment’s platform), and keeping track of supplier activity through public platforms such as GeoRSPO and the World Resources Institute’s Global Forest Watch (GFW).
We are also part of the RADD (Radar Alerts for Detecting Deforestation) system, a pilot multi-stakeholder platform with updated technical capabilities that allows us to detect tropical deforestation in less time. Through these platforms, we can monitor over six million hectares across Indonesia and Malaysia. We work with WRI’s pilot RADD system to work on the satellite monitoring alerts and verification work on the ground.