Unilever suspends palm oil suppliers over deforestation claims

1 May 2018

Unilever has suspended orders of palm oil from two suppliers after Greenpeace accused firms of destroying rainforests in Indonesia.

Greenpeace said satellite analysis suggests that around 4,000 hectares of rainforest in Papua, an area almost half the size of Paris, had been cleared between May 2015 and April 2017.

It said photos and video taken in March and April 2018 show massive deforestation in PT Megakarya Jaya Raya (MJR), a palm oil concession controlled by the Hayel Saeed Anam (HSA) Group. Although PT MJR is not yet producing palm oil, Greenpeace said two other HSA subsidiary companies – Arma Group and Pacific Oils & Fats – supplied palm oil to Mars, Nestlé, PepsiCo and Unilever.

Unilever said it was aware of the Greenpeace allegations. The firm said: “Following recent investigations and monitoring of HSA Group’s activity, we have concluded that the allegations were not being sufficiently addressed. As we have not seen progress that complies with our Sustainable Palm Oil Sourcing Policy, we have therefore suspended the placement of any new orders from Pacific Inter-Link and Arma Food Industries, HSA Group’s suppliers, until the allegations have been satisfactorily addressed by them.”

Nestlé said: “We are concerned by these findings and are working closely with The Forest Trust and our supplier to address them.”

Mars said: “As a supplier to Mars, we fully expect Arma to comply with our deforestation and palm oil policies. We are assessing the situation and are prepared to take further action should Arma be found to be non-compliant.”

Greenpeace highlighted that the findings come as a delegation from the Indonesian government arrives in Europe to defend the palm oil industry, which is under pressure from moves by the European Parliament to discourage palm oil use in biofuels on environmental grounds.

Supermarket Iceland has also pledged to remove palm oil from all its own-brand products by the end of the year.

Luhut Panjaitan, the coordinating minister for maritime affairs in Indonesia, has been visiting European cities, including Brussels and Berlin, while the government has talked of expelling NGOs which “disrupt” the country’s palm oil industry.

Richard George, forests campaigner at Greenpeace UK, said: “After destroying much of the rainforests of Sumatra and Kalimantan, the palm oil industry is now pushing into new frontiers like Papua.

“If the Indonesian government wants to defend this industry, the best thing it can do is to force it to clean up its act, not threaten to start a trade war.”

Greenpeace said the case raises serious questions the destruction may be violating Roundtable on Sustainable Palm Oil (RSPO) principles. Many HSA Group palm oil companies are members of the RSPO, although PT MJR and the other HSA Group concessions in this district are not. Members of the RSPO are not allowed to have palm oil divisions which are not affiliated to the organisation.

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