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New agreements on fully segregated sustainable palm oil supplies from PNG

August 14, 2013

According to articles published on the website, a new commercial agreement has been concluded between New Britain Palm Oil Ltd (NBPOL), based in Papua New Guinea (PNG), and Olenex, a joint venture between ADM and Wilmar International, to supply 350,000 tonnes of fully traceable segregated palm oil per year to processing facilities in the UK and Germany. This will supply approximately 10% of [the] palm oil used by the food industry in Europe each year in the form of 100% segregated i.e. kept separate from non-sustainably produced palm oil, with full traceability to sustainably managed production areas, making it much easier for manufacturers to guarantee the use of sustainably sourced palm oil in their food products. According to the companies involved in the agreement, the new joint venture will provide unprecedented supply chain collaboration in the supply of sustainably produced palm oil.

Food manufacturers who are committed to using sustainable palm oil have welcomed the agreement. Representatives of one of the manufacturing companies served by the joint venture arrangement, the Ferrero Group, maintained that the initiative would enable the company to purchase their ingredients in a responsible manner ahead of target, that is, faster than the nominal commitments already made by the company.

This comes against the background of criticism by the World Wide Fund for Nature (WWF) of the Roundtable on Sustainable Palm Oil (RSPO) system of sustainability certification. WWF claimed that while the RSPOs revised principles and criteria were a step in the right direction, they were nevertheless insufficient to prevent deforestation because they do not require producers to account for greenhouse gas emission and clearance of carbon-rich peatland. WWF called on progressive companies to set and report on particular performance standards within the framework set by RSPO. More generally, environmental NGOs are urging the RSPO to become tougher with its members in living up to RSPO standards in all their palm oil operations.