Nestlé "very concerned" over deforestation links to Wilmar palm oil

By Louis Gore-Langton

- Last updated on GMT

Wilmar has been sourcing illegal palm oil from plantations in critically endangered habitats, according to new findings iStock©
Wilmar has been sourcing illegal palm oil from plantations in critically endangered habitats, according to new findings iStock©

Related tags Palm oil

Nestlé says it is "very concerned" by allegations that its palm oil supplier Wilmar International has again been implicated in sourcing palm oil from the protected Leuser ecosystem in Indonesia, according to a report by the Rainforest Action Network (RAN). 

RAN said it has uncovered the illegal razing of protected rainforest in Sumatra, Indonesia, carried out by subsidiaries of Wilmar in violation of a moratorium on deforestation.

After obtaining aerial footage of forest clearance in the Leuser ecosystem, a UNESCO world heritage site, RAN discovered a local company – PT Agra Bumi Niaga (ABN) had been illegally clearing forest for what the report​ described as "a significant amount of time​".

Singapore-headquarted Wilmar, the world's biggest supplier of palm oil, was indirectly sourcing palm from ABN's illegal plantation. Wilmar responded to the allegations by saying it "immediately initiated engagement" ​with producers and that purchases from ABN had been "put on hold"​. 

Between June 2016 and January 2017 around 324 hectares of forest were lost as a result of ABN’s logging, RAN claimed. The Leuser ecosystem is home to critically endangered species of elephant, orangutan and tiger. 

After mapping losses in tree coverage through satellite and aerial footage, RAN agents followed supply trucks from ABN’s plantation to a nearby processing mill owned by local company PT. KPJ, which in turn provides crude palm oil to Wilmar.

Wilmar has been accused of sourcing illegal palm oil from the Leuser ecosystem several times since the company’s 2013 pledge​ to end illegal practices and fight deforestation, destruction of peat lands and exploitation of workers.

RAN said in the report: “Over the past two years a number of Wilmar’s suppliers have been connected to the destruction of the Leuser ecosystem… Wilmar has previously taken action to exclude a number of these controversial suppliers from its supply chain but to this day continues to source conflict palm oil grown at the expense of the Leuser ecosystem.”

Nestlé: ABN is part of our supply chain

Wilmar is the world’s leading supplier of palm oil, controlling roughly 40% of global trade and providing the product to companies such as Nestlé, Proctor and Gamble, McDonalds and PepsiCo.

Cornelia Tschantré, communications manager at Nestlé, told FoodNavigator: “We are very concerned by Rainforest Action Network’s allegations that palm oil companies are engaged in deforestation in the Leuser ecosystem in Indonesia. One of the companies identified by RAN, PT. Agra Bumi Niaga, is part of our supply chain and we are working closely with our larger suppliers, including Wilmar, to investigate the allegations.

“If we find that our suppliers and sub-suppliers are not meeting our requirements, including on deforestation, we will take action.  Wilmar has already temporarily suspended its indirect purchasing of palm oil from PT. Agra Bumi Niaga until more is known. We will engage in discussions with Rainforest Action Network and others regarding the situation in Leuser to help bring an end to illegal and destructive practices.”

Future action

Wilmar and Nestlé are members of the Roundtable on Sustainable Palm Oil (RSPO). A spokesperson for Amnesty International last year accused​ the companies of using the RSPO as ‘a smokescreen’ to avoid further scrutiny amid allegations of child labour on Wilmar’s plantations.

However, new satellite technology designed by Forest Trust and Airbus Defense and Space, the system (called ‘Starling​’) will use radar and high resolution imagery to ensure plantations abide by the moratorium on deforestation,  and will be adopted by Wilmar, Nestlé, Ferrero and others.

Technology such as this should make it harder for palm oil suppliers to circumvent the law and easier to ensure supply chain traceability.

Related topics Nestlé Unilever Sustainability

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