Thu, Feb 21, 2019 - Page 9 News List

European firms find green palm oil hard to digest

By Michael Taylor  /  Thomson Reuters Foundation, KUALA LUMPUR

Europe, the world’s second-biggest buyer of palm oil, is set to miss a target backed by about 10 countries, as well as big companies, to use 100 percent sustainable supplies of the edible oil in food ingredients by next year, environmental experts said.

A lack of public awareness and debate around the palm oil industry has left nations like Italy, Spain and Poland lagging behind their neighbors in green palm oil purchases, a report last month by The Sustainable Trade Initiative (IDH) said.

“Countries in northwestern Europe are leading the pack,” said Daan Wensing, a director at IDH, a Netherlands-based nonprofit. “Other major destinations are just getting started.”

In addition to a lack of government action to force buyers to purchase sustainable palm oil, Wensing said European catering and animal feed companies are not coming under consumer pressure to source greener supplies.

“The industries that are consumer-facing have stepped up, but sectors like canteen catering services are not really playing ball yet,” he said.

As the world’s most widely used edible oil, palm oil is found in everything from margarine to biscuits and soap to soups, as well as in biofuel, but in recent years, the industry has come under close scrutiny from green activists and consumers, who have blamed it for clearing forests for plantations and causing fires, along with the exploitation of workers.

In response, about 10 European governments — including France, the Netherlands and Britain — and major corporate buyers of palm oil like Nestle, Mondelez, PepsiCo and Unilever pledged to purchase only sustainable palm oil by next year.

The EU has also approved a law to phase out palm oil-based biofuels by 2030, causing outrage in top producer nations Indonesia and Malaysia.

However, with less than two years to go until the end of next year, only 74 percent of palm oil bought by Europe’s food industry was certified as sustainable, the IDH report said.

“To meet the 100 percent target by 2020 is going to be very difficult because now we move into these markets where there is no consumer pressure or awareness,” Wensing said.

Palm oil certified as sustainable by the global industry watchdog, the Roundtable on Sustainable Palm Oil (RSPO), accounts for about one-fifth of global output, at an estimated 12.3 million tonnes per year. It sells at a premium, but demand covers just half of supply.

Europe imported an estimated 7 million tonnes of palm oil in 2017, according to consultancy LMC International, with about 2.6 million tonnes of that used for food production.

Anne Rosenbarger, Southeast Asia commodities manager at the World Resources Institute Indonesia in Jakarta, said the debate around palm oil had often been politicized, further confusing consumers.

The British supermarket chain Iceland, for example, last year said it would remove palm oil from its own-brand food by the end of last year as part of efforts to stem deforestation.

The retailer was then banned from showing a palm oil-themed Christmas advertisement on television, because it was deemed to breach political advertising rules.

Such controversies around palm-oil boycotts are making major brands wary of using the RSPO logo on their products and drawing attention to their use of palm oil, Rosenbarger said.

Building greater awareness of sustainable palm oil and the RSPO among consumers would encourage more food makers to use the trademark on their products, she added.

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