Rainforest campaigners are concerned that a recent Food and Drug Administration proposal to phase out trans fats may boost demand for palm oil, a crop whose large-scale production is linked to deforestation in Southeast Asia.

Trans fats, which include partially hydrogenated or hydrogenated oils, are chemically altered oils that give peanut butter its smooth texture, pastries their long shelf life and margarine its solid state. It is a chemically stable source of unsaturated fat, long valued for its ability to make foods last longer.

Once viewed as a healthier alternative to saturated fats like lard and butter, trans fats lost favor in the mid-1990s as studies began to link hydrogenated oils to heart disease and a promoter of "bad" LDL cholesterol. Palm oil, an abundant, low-cost and chemically stable oil, was regarded as an accessible alternative.

As health concerns around trans fats grew, palm oil exports to the United States doubled -- from 500,000 metric tons to 1 million -- between 2006 and 2008, according to the Agriculture Department. This encouraged growers to slash and burn tropical rainforests, which store CO2. They also dredged carbon-rich peatlands to clear land for more oil palm plantations.

"It's something we're watching very carefully," said Dave McLaughlin, vice president for agriculture at the World Wildlife Fund. "The more demand that we add to it, the more we're putting forests at risk."

In the last two decades, the area of palm oil plantations has expanded nearly eight times in Indonesia alone, according to a recent USDA Foreign Agricultural Service report. Growers, including those that plant certified sustainable oil palm trees, have been accused of clearing native forests, destroying the habitat of endangered species and violating the rights of forest dwellers. About 85 percent of palm oil is grown in Indonesia or Malaysia.

"Right now, you have a situation in some of the producing countries where national parks aren't even safe," McLaughlin said.

Shift in makeup of convenience foods
News of the FDA announcement resonated in Singapore, home of several large palm oil traders. If approved, the proposal would open a significant share of the market once dominated by the soybean oil industry to palm oil, according to a recent Reuters story.

"In the U.S., they use close to 3 million [metric] tons of oil to convert into fatty acids, and if they have to replace it, palm oil takes over that market to a large extent," one Singapore-based edible-oil trader said in the report.

"It's clear that the palm oil traders are signaling that the trans fat announcement from FDA is good news for the palm oil industry," said Nell Greenberg, communications director for the Rainforest Action Network. RAN recently launched a campaign to push 20 food companies to create a better system to track their supply of palm oil (ClimateWire, Sept. 12).

Although palm oil is less harmful than trans fats, it is a saturated fat and can still increase the risk of heart disease, Greenberg said. The FDA proposal, she added, is a call for a significant change in convenience foods.

"It really is time for manufacturers to take on a much bigger transformation in what it takes to make food," she said.

But despite the enthusiasm in Singapore, some market analysts and companies are doubtful that the FDA's decision could bring in a flood of palm oil to replace hydrogenated oils. The real shift happened when food companies began to voluntarily remove trans fats from the ingredients list, said Roy Huckabay, principal of Linn Group Asset Management, a commodities trading firm.

"Most of those conversations took place a long time ago and have been consumer-driven," he said.

Only about 400 million pounds of oils used in food is still trans fats, Huckabay added. That's a tiny sliver of the entire oil supply, and much of that could be replaced with blends of corn, canola and cotton oils.

A spokeswoman from the global food company Archer Daniels Midland Co. said she could not speculate on how the move would affect the palm oil market.

Low industry standards, poor enforcement
"There are many different alternatives to partially hydrogenated vegetable oil for customers to consider depending on the type of outcome they are looking to achieve," she said. "Palm oil is one solution, but it's not the only option."

This week, the Roundtable on Sustainable Palm Oil convenes its annual meeting in Indonesia. Formed in 2004 to address the growing environmental and human rights concerns around palm oil, the RSPO -- a consortium of nongovernmental organizations, financial lenders, oil palm growers and companies that use palm oil in their products -- has been criticized for its low standards and poor enforcement.

A recent report from the Forest Peoples Programme, Sawit Watch and TUK-Indonesia found that at least 11 RSPO member companies or subsidiaries of those companies are violating the rights of communities and digging in peat swamps, which releases large amounts of carbon dioxide.

Although the RSPO must improve its internal quality control, national governments are also responsible for recognizing communities and curbing deforestation, said Marcus Colchester, senior policy adviser for the Forest Peoples Programme in the United Kingdom. Consumers around the world must also make it clear that they will not buy products with controversial palm oil.

"There need to be much stronger signals coming from Western markets -- retailers and manufacturers -- and from investors and especially from the huge trading houses that deal in palm oil," he said.

The Indonesian and Malaysian governments must also make it easier for new plantations to be established only in "degraded" lands, areas outside carbon-rich forests and peatlands that would allow for economic development and forest conservation, said Frances Seymour, a senior fellow at the Center for Global Development. Indonesian President Susilo Bambang Yudhoyono has said the country must double its palm oil output by 2020.

FDA proposed its determination Thursday, when it announced a 60-day comment period for the proposal. The agency must publish a final determination to establish whether trans fats are "generally recognized as safe."

Reprinted from Climatewire with permission from Environment & Energy Publishing, LLC. www.eenews.net, 202-628-6500