Oil Palm and Agroforestry Systems: An Opportunity for Innovation and Shared Value in Latin America’s Regenerative Palm Oil Sector

The palm oil sector in Latin America is at a historic turning point towards regenerative agriculture. In the face of climate change challenges and growing demands from global markets, including zero deforestation regulations such as the EUDR, NDPE (No Deforestation, No Peat, No Exploitation) policies, and decarbonisation commitments, regenerative palm cultivation is emerging as a sustainable and climate resilient production model that promises to transform the way we produce palm oil, particularly within family farming contexts (small scale oil palm growers with farms smaller than 50 hectares). Among its practices, this approach includes Agroforestry Systems (AFS) with oil palm.

From Theory to Action: Regional Success

Latin America is not only discussing Agroforestry Systems for regenerative palm cultivation; it is leading the way globally. Regional experiences demonstrate that integrating oil palm with forest species, fruit trees, and short cycle crops is not only environmentally responsible, but also technically viable and economically profitable.

In Brazil, the Dendê SAF project has become a global benchmark. With 10 years of implementation supported by Embrapa, Camta, Natura, and CIFOR-ICRAF, the initiative has demonstrated that the model can scale successfully, create a more profitable and resilient palm oil sector, and diversify the economy of palm growing families, as seen through the achievements of the Tomé-Açu producers’ organisation.

Meanwhile, Peru took its first steps through the Central Committee of Oil Palm Growers of Ucayali (COCEPU), establishing the first demonstration plots adapted to the realities of family farming under the UNDP Sustainable Landscapes Project. These efforts are now moving into a scaling phase with technical assistance from the Steering Group for Sustainable Palm Oil, composed of Earthworm Foundation, Paisajes Futuros – TNC, Swisscontact, Solidaridad, and other civil society organisations.

Similar initiatives in Colombia (Cenipalma), Ecuador (Propalma), and Mexico (Palma Holístico, Programa Terranova, and the Palmelit CIRAD experience) confirm that the region is serving as a living laboratory for innovation in regenerative palm cultivation through agroforestry integration.

Why Invest in the Agroforestry Model?

The transition from traditional monoculture to Agroforestry Systems offers multidimensional benefits:

1. Climate and Production Resilience: Biodiversity helps protect crops against pests and market fluctuations.
2. Soil Health: Dependence on external chemical inputs is reduced through improved nutrient cycling and increased organic matter.
3. Access to New Markets and Diversified Financial Flows: Producers are no longer dependent on a single source of income, as associated crops generate cash flow at different times of the year.
4. Landscape Restoration: Agroforestry Systems function as “productive forests” that capture carbon and restore essential ecosystem services in the Amazon region.

The Path Towards Scaling

For this vision to become the norm rather than the exception, the sector must align around a clear strategy. The recent SAF PALM 2026 Seminar, “The Pathways of Agroforestry in Latin America,” held in Pucallpa, Peru, on 19 and 20 March (organised by Earthworm Foundation with support from private sector actors such as Cargill and Nestlé, as well as organisations from Peru’s Steering Group for Sustainable Palm Oil, of which RSPO is a strategic ally), generated key strategic reflections that help define the roadmap ahead:

• Technical Protocols: It is essential to develop clear criteria and guidelines adapted to each local context in order to guide producers in implementation.
• Participation and Ownership: The transition must be led by producers themselves. Participatory spaces for information sharing and validation help ensure the model remains sustainable over time.
• Incentives and Evidence: The use of reference frameworks to measure real impact and generate technical and financial evidence will facilitate the design of incentives that promote regenerative production.
• A dedicated Agroforestry Systems for palm oil programme involving governments, cooperation agencies, companies, and producers forms part of the scaling potential being promoted following the event.

While it is true that Agroforestry Systems have historically been stigmatised by conventional palm cultivation as a model with lower productivity and long term efficiency, current scaling experiences confirm that they represent a major opportunity for the Latin American palm oil sector to implement innovation and economic diversification at the base of the supply chain, which is increasingly promoting these regenerative practices over the medium term.

Peru is the leading country in Latin America in terms of the number of RSPO certified Independent Smallholder groups (around 200 members) and already has four groups certified under the RSPO Independent Smallholder Standard (ISH): Aproman, Cocepu, Santa Lucía, and ASPASH, as well as four additional groups currently undergoing the membership process: Jarpal, Acepat, Unipalma, and APACHE.

In this context, innovative practices such as Agroforestry Systems represent an alternative for promoting a diversified and regenerative palm oil production model aligned with RSPO implementation towards sustainability, particularly in relation to the compensation and remediation objectives established by each group.

Furthermore, these practices reinforce the sector’s global competitiveness. By adopting these models, we are not only producing palm oil; we are regenerating soils, promoting resilient economies, conserving ecosystems and sustainable landscapes, and strengthening the competitiveness of the Latin American palm oil sector.

* This event was made possible thanks to the support of Cargill, Nestlé, Solidaridad, Industrializadora Oleofinos, Natura, Industrias del Espino (IDE), The Nature Conservancy (TNC), MDA – Mecanismos de Desarrollo Alternos, CIFOR-ICRAF, Earth Innovation Institute, Grupo Palmas, and the Central Committee of Oil Palm Growers of Ucayali.

** The event received funding from Amazonia Link, a project implemented by Solidaridad under the European Union’s AL-INVEST Verde programme. Its objective is to support the preparedness of MSMEs (producers) in Peru’s coffee, cocoa, and oil palm sectors for EUDR compliance and the adoption of regenerative agricultural practices.