Collecting raw materials from natural forests, APP continues to violate its sustainability commitments

Pekanbaru, March 1, 2024 - Jikalahari published a release highlighting the indications of deforestation and clearing of natural forests carried out by Asia Pulp & Paper / Sinar Mas group through its subsidiaries, namely PT Arara Abadi and PT Riau Indo Agropalma, in Indragiri Hilir, Riau.

Based on the findings of Jikalahari team in February 2024, natural forest clearing is estimated at 376.80 hectares, consisting of 60.36 ha in Production Forest Function (HP) and 316.44 ha in other use areas (APL). This finding strengthens Jikalahari's suspicion that the Sinarmas Group collects, accommodates, or processes forest product raw materials originating from illegal raw material sources.

According to EoF records, this is not the first time APP/SMG has carried out logging in natural forests. Only two months after APP announced the policy, Eyes on the Forest found PT Riau Indo Agropalma (RIA), an “independent” supplier of APP/SMG in Riau, still cleared natural forest in the Kerumutan block in Riau[1]. Then, in November 2013, another APP supplier in West Kalimantan, PT Daya Tani Kalbar (DTK), also cleared 1,400 hectares of the natural forest without any HCV or HCS assessments at the beginning phase of the APP moratorium on natural forest clearing[2].

Then in 2014, Jikalahari found 1 (one) unit of excavators working to drain a canal and build a road in the area of “community use” in PT Mutiara Sabuk Khatulistiwa (PT MSK, APP supplier)[3] concession in Riau. It didn't stop there, in 2016 APP announced that production of one of the world’s biggest pulp and tissue mills will start[4]. APP was urged by scores of national and global Non-governmental Organizations to immediately stop peat drainage in their operation and restore degraded areas.

In 2017, released by NGO Coalition revealed that APP along with its rival Asia Pacific Resources International Holdings Limited (APRIL) were found purchasing timbers from PT Fajar Surya Swadaya[5]. It is an industrial timber plantation (HTI) license holder in East Kalimantan from the Djarum group. Both were estimated to have cleared nearly 20,000 hectares since 2013. APP also indicated purchasing logs from PT Silva Rimba Lestari, another timber company in East Kalimantan Timur, which clearcut natural forest in size of 12,000 hectares in the meantime. 

In May 2018, a report released by Koalisi Anti-Mafia Hutan (KAMH) indicated that 24 out of 27 supplier companies called by APP “independent” partners are closely linked to Sinar Mas Grup or its affiliate companies through controls by persons indicated as current or former officials of Sinar Mas Grup or affiliates could be used to hide deforestation and other issues associated with its pulp & paper production[6].

Again, in 2020, EoF found that APP/SMG through “independent” suppliers of PT RUJ and PT SGP in Senepis block, Riau, have cleared the natural forest and expanded acacia plantation on peat depth of over 4 meters[7]. Most recently, in January 2022, EoF again discovered indications of deforestation, cutting down of natural vegetation and expansion of industrial forest plantations (HTI) carried out by PT Arara Abadi and PT Sekato Pratama Makmur in the UNESCO Giam Siak Kecil – Bukit Batu Biosphere Reserve. The area is also a habitat for Sumatran elephants and has deep peat[8].

Jikalahari's findings regarding the logging of natural forests in Indragiri Hilir Regency in February 2024 increase the number of violations record committed by APP/SMG. APP also broke its promise to support the Government's program to reduce GHG emissions (SDGs).

EoF in this news again questions the company's seriousness and APP's ability to implement its "zero deforestation" commitment. EoF also urges APP/SMG and its suppliers to immediately stop all activities that are contrary to their FCP commitment.

According to Trase data reported by the Betahita daily (11/30/2023), until now the pulp sector has been controlled by three groups of companies, namely Sinar Mas and its subsidiary Asia Pulp & Paper (APP), Royal Golden Eagle and its subsidiary Asia Pacific Resources International Ltd (APRIL), and Marubeni. Among these groups, Trase found that APP and APRIL dominate the industry, with pulp export figures reaching 95% and 96% of overall pulp production respectively.

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