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IDH/PTPN3 Project

Aidenvironment has developed a survey tool to determine the baseline smallholder situation. This tool builds on the Smallholder Diagnostic Survey Instrument (SDSI) developed by Aidenvironment, Global Sustainability Associates and Triodos Facet in conjunction with IFC.

The Sustainable Trade Initiative (IDH), which runs market transformation programs to deliver poverty reduction, environmental, and fair trade benefits, is starting an ambitious program to encourage sustainable palm oil production and reduce deforestation. One way to do this is to increase the productivity of existing smallholder plantations.

The program focuses on supporting smallholders in several “supply shed” areas, enabling them to boost production of traceable palm oil so that supply chain partners can source fully segregated and certified palm oil. In a previous IDH assignment in 2013, Aidenvironment mapped three supply shed areas for RSPO-certified CPO mills sourcing from independent smallholders. IDH has compiled a business case and funding mechanism to upgrade independent smallholders in these designated supply shed areas. A partnership of IDH, the Roundtable on Sustainable Palm Oil (RSPO), Unilever, and the state-owned plantation company PT Perkebunan Nusantara (PTPN) III now wants to implement this development model around one of the PTPN III mills in North Sumatra.

Aidenvironment has developed a survey tool to determine the baseline smallholder situation. This tool builds on the Smallholder Diagnostic Survey Instrument (SDSI) developed by Aidenvironment, Global Sustainability Associates and Triodos Facet in conjunction with IFC. An adjusted version of the tool can be used to monitor the impacts of the pilot project and, at a later stage, the entire program once it has been fully scaled up. To enable the smallholders participating in the pilot project to obtain finance from banks and other financial institutions, the current bankability of the smallholders has been assessed using clear indicators.

As pen and paper surveys can be time consuming, and because the data from these surveys are not accessible during fieldwork and errors can occur during digitalization, Aidenvironment made use of cellphone and tablet-based field surveys. A specialized app called Akvo FLOW was used to compile the data. This allowed photos to be taken (e.g. for remote and quick agronomic analysis) and geolocations to be recorded, as well as giving project partners access to the most recent data.

The findings show that smallholders are still underperforming and that there is ample opportunity to increase yields. The traders and agents provide the smallholders with market access, transport, and interest-free credit in the form of loans. The role of the traders cannot be bypassed in organizing the smallholders for certification.

For more information contact Meri Persch-Orth.