Orang Utans and Palm Oil.

Palm Oil is one of the most lucrative cash crops of recent time ( Nantha, H. S and Tisdell, C. 2009). Therefore from an economic point of view, there is a large opportunity cost between Orang Utan Conservation and Palm Oil farming. Opportunity cost is basically the cost (profit) sacrificed when a choice is made ( e.g. Saving the Orang Utans).

The price of Palm Oil on a basic economic scale will keep rising as demand increases whilst supply grows at a slower rate even though the area for palm oil planting has trebled in just over 10 years. At least 55% of this land is taken from natural forest whilst the remaining 45% is from other croplands being converted.

Whilst from a conservationists point of view the simple answer would be to stop growing palm oil, local governments find it hard to refuse offers from the big private investors and it increases the wealth of cities. The paper I am talking about says that “The orangutan in itself has little direct use value”. This is where the opportunity cost I mentioned earlier comes into play. It’s a choice between money and large profits against a rare and beautiful species that has countless worth for those who care about nature.

http://link.springer.com/article/10.1007/s10531-008-9512-3 is the link to the paper. It’s a very interesting read and I’d recommend reading it to understand the financial situation behind the conservation of the Orang Utan.

Reference:

Swarna Nantha, H. & Tisdell, C., 2009. The orangutan-oil palm conflict: Economic constraints and opportunities for conservation. Biodiversity and Conservation.

 

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