At current prices, carbon credits cannot compete with profits from felling forests and developing rubber plantations, study says

By Michael Taylor

KUALA LUMPUR, March 20 (Thomson Reuters Foundation) - The price of carbon credits must rise drastically if they are to help protect Southeast Asia's tropical forests against rubber plantation expansion, according to researchers.

Individuals, companies and countries purchase carbon credits to offset their greenhouse gas emissions.

Putting a cost on carbon emissions provides an incentive to do business more sustainably, and a disincentive to engage in environmentally damaging activities - like clearing forests.

But researchers found that credits bought and sold on international markets would need to rise from $5-$13 per tonne of carbon dioxide to $30-$51 per tonne if they are to safeguard Southeast Asian forests from rubber.

At current prices, carbon credits cannot compete with the profits to be made from felling forests and developing rubber plantations, according to the report published this month in the journal Nature Communications.

"We looked at rubber as an economic driver of deforestation," said Eleanor Warren-Thomas, the lead researcher who was at Britain's University of East Anglia when she worked on the study.

"What kind of profits can you make from rubber plantations, and what kind incentive (to preserve forests) do you need to provide through carbon finance?"

Such a large study has not been done before, she told the Thomson Reuters Foundation.

Most forest conservation efforts in the region tend to focus on palm oil expansion, and the growth of rubber plantations has received little attention, said Warren-Thomas.

Rubber demand rose over the last 20 years, as emerging markets like China and India became wealthier and more people were able to buy cars and motorcycles.

Rubber plantations cover about 11 million hectares around the world, two-thirds of which are in Southeast Asia, while annual expansion rates roughly doubled between 2003-2013, said Warren-Thomas.

Converting forests to rubber plantations results in net carbon emissions, as the carbon stored in the cut-down trees is released into the atmosphere - but that is not widely recognised in the industry, the researchers said.

"Rubber is (from) trees, and so it looks like you've replaced one kind of forest with another," said Tom Evans, an Oxford-based conservation director at the Wildlife Conservation Society, which was involved in the report.

"But really you've replaced a high carbon system that provides a lot of other ecosystems services with a much lower carbon ecosystem."

Zero-deforestation pledges made by governments and large tyre companies, as well as the enforcement of forest protection laws, are crucial to curb rubber expansion, the report said.

Besides higher carbon credit prices, it also recommended further development of synthetic alternatives to natural rubber and improvements in recycling of natural rubber.

The researchers focused on forests in Cambodia, but those in China, Laos, Myanmar and Vietnam are also under threat from rubber, Warren-Thomas said.

(Reporting by Michael Taylor, Editing by Jared Ferrie. Please credit the Thomson Reuters Foundation, the charitable arm of Thomson Reuters, that covers humanitarian news, women's rights, trafficking, property rights, climate change and resilience. Visit http://news.trust.org)

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