Thursday, 6 May 2010

Unilever pledges to continue to buy CPO from Indonesia

Unilever pledges to continue to buy CPO from Indonesia

The Jakarta Post, Jakarta Thu, 05/06/2010

Unilever, the world’s biggest purchaser of palm oil, says it will continue to buy at least 65 percent of the company’s crude palm oil (CPO) from Indonesia despite suspending orders from massive palm oil producer PT Sinar Mas Agro Resources and Technology (SMART).

Maria Dewantini Dwianto, spokeswoman for the Dutch company’s Indonesian subsidiary PT Unilever Indonesia, said in Jakarta on Wednesday the company had made the decision to stop trading with SMART based on the verification that the palm oil producer was not employing sustainable plantation practices.

“Unilever’s decision to stop new purchase orders is related to the company’s commitment to
preserve the environment. In 2015, we will only buy CPO with certificates issued by the Roundtable on Sustainable Palm Oil [RSPO],” she said, adding the decision had nothing to do with accusations by NGOs.

Last year, she continued, Unilever appointed independent Dutch research firm Aidenvironment to verify accusations made against palm oil producers in Indonesia, including SMART, one of the country’s largest producers of palm oil.
According to Maria, the findings proved the accusations to be true.

On Dec. 11 last year, Unilever decided not to make new orders of CPO from SMART due to Greenpeace findings that showed SMART’s palm oil plantation operation had devastated large tracts of rainforest.

“However, Unilever was still buying CPO from SMART up until last month, because orders had been made before the company decided to suspend purchases,” Maria said.

Two independent consultants, Control Union Certification (CUC) of the Netherlands and the British Standards Institute Group (BSI), have been named to verify the allegation that SMART has damaged rainforests.

SMART supplies five percent of the one million tons of CPO Unilever needs for its manufacturing operations each year.

In addition to SMART, Unilever also suspended purchase contracts with another Indonesian CPO producer, Duta Palma.

Besides Unilever, Greenpeace has since urged CPO buyers, such as Switzerland-based food producer Nestlé and the US-based company Cargill to stop buying CPO from producers that disregard sustainable plantation practices, which are a requirement of the RSPO.

Following Unilever’s decision, Nestle, which purchases 4,000 tons of CPO a year, joined the move last month, also deciding to suspend purchases of CPO from SMART.

Indonesia is the biggest producer of palm oil, contributing 44.5 percent to the world’s total output of 42.9 million tons in 2008. (rch)