“When we first arrived here, we had a tiny house with palm fronds as our roof and the earth as our floor,” shared Ana Villasis, a smallholder from the Ucayali region in Peru. “Our lives improved a lot when we started cultivating oil palm. My daughter had the opportunity to study in a private university, I built my house, I’m much more comfortable, and we have basic utilities like water, drainage, even cable – none of this would have been possible if it weren’t for oil palm.”
For over four years now, Ana has been part of Grupo Palmas’ “Cadenas Productivas” (“Value Chains”), a strategic model developed by Grupo Palmas for the inclusion of smallholders in the supply chain that places smallholders at its axis. Since 2015, the model has incorporated responsible purchasing conditions that uphold Grupo Palmas’ Sustainability Policy centred on the principles of no deforestation, no development on peatlands, no exploitation and respect for workers.
Moreover, value is added to smallholders’ plantations through the establishment of a fair price and timely payment, traceability of production, better conditions to acquire tools and agrochemicals, and permanent training to maximise their plantation yields.
An RSPO Member since 2016, Grupo Palmas is part of an increasing number of companies in Latin America championing sustainability efforts that are bolstering the region’s dynamic growth of CSPO production.
From economic to environmental benefits
Ana’s family is just one of over 7,000 families in Peru that are dedicated to oil palm cultivation, of which 65% is carried out by smallholders. Oil palm production has made it possible to substitute the illegal cultivation of coca leaf crops, which has been occupying lands that have already been intervened.
Jorge Mosquera, another smallholder from Ucayali who has been involved in Cadenas Productivas for over five years, said, “It has been a blessing that someone has come to teach me what I didn’t know before. I started applying fertiliser to my palm crops because it was the suggestion of the Grupo Palmas trainers as part of their technical assistance, otherwise we wouldn’t get good yield.” Apart from proper fertiliser application, the farmers also learned about pest control and agricultural management aligned with sustainability criteria.
“My land continues to have great productivity because I’m doing good practices that are more advanced; we will keep growing with better technology that is environmentally-friendly. They are also buying our production — this has been a big incentive for us. You can see how Grupo Palmas has been contributing to the well-being of us farmers.”
“The smallholders of Grupo Palmas provide a great opportunity to demonstrate how sustainability and socioeconomic progress go hand in hand,” said Francisco Naranjo, RSPO Director for Latin America. “The recent certification of Grupo Palmas’ parent company Palmas del Espino will be an essential lever to encourage smallholders to achieve RSPO certification.”
Renzo Balarezo, CEO of Grupo Palmas said, “For Grupo Palmas, the smallholders in the value chains are at the centre of everything. From the beginning, we set out to contribute to their professionalisation and generate shared value. The cultivation of oil palm generates tangible progress in the Peruvian Amazon and the formalisation of the smallholder is key to sustaining it. Today we see with great satisfaction how they improve their productivity with the technical assistance and services we provide them; they have a secure income, which contributes to the well-being of their families. Just like Ana and Jorge, Grupo Palmas aims to train more producers who inspire by example and lead the sustainable development of their regions.”
Thanks to the lessons learned over the years through the Cadenas Productivas model, Ana has recognised how economic benefits come hand in hand with environmental preservation. “The banks have opened their doors to us, whereas before, nobody wanted to give us credit.”
“We learned how to take care of the environment, so we do not burn, we practice zero deforestation, and even more so now with the technical training. I’m even more proud now of what I do – I really like that we women are able to do everything; we can be professionals, we can be assigned different tasks. As for myself, I’m very proud to be an oil palm farmer, because it’s an honest job with dignity, and with a lot of economic benefits.”
