Jakarta Globe, Michael Taylor | October 20, 2010
Unilever, the world’s top palm oil buyer, uses palm oil for its myriad products like Dove soap and Stork margarine. (Reuters/Yusuf Ahmad) |
Palm oil buyers in India and China need to join those in Europe in signing up for a certification scheme to promote sustainable palm oil, consumer goods giant Unilever said on Tuesday.
The Roundtable on Sustainable Palm Oil, an industry body of consumers, green groups and plantation companies, was formed in 2004 and aims to promote growth and use of sustainable oil palm products.
“We need to increase the uptake of certified oil in the market,” said Jan Kees Vis, global director of sustainable sourcing development at Unilever. “We know that the demand from Europe is not enough.”
Annual production capacity of RSPO-certified sustainable palm oil jumped over the three-million-ton mark last month, according to the industry group.
Certification for green palm oil started in August 2008.
“Global production is about 45 million tons — India takes eight million tons, China seven million tons, Europe about six million tons, United States and Egypt one million tons,” added Vis, who was elected to lead the RSPO at its conception in 2004.
Unilever, the world’s top palm oil buyer, uses palm oil for its myriad products like Dove soap and Stork margarine.
The Anglo-Dutch firm said in April that it would more than double this year to 400,000 tons its purchases of certified, sustainable palm oil.
But the certified palm oil sector has been plagued by weak demand due to the higher cost involved.
Palm oil planters have also complained that premiums for eco-friendly palm oil are not high enough to encourage production.
“There is more production at the moment than there is demand, and if that continues, the incentive for more growers to get certified will diminish,” Vis said ahead of the RSPO’s annual meeting in Jakarta from Nov. 8-11.
“We need to get the Indian and the Chinese market involved, which is difficult to do.
“We do need to involve more smallholder farmers,” he added. Indonesia is the world’s No. 2 producer of the vegetable oil.
But accusations from green groups over deforestation have led firms such as Burger King, Nestle and Unilever to stop buying palm oil from firms like Sinar Mas Agro Resources & Technology.
In August, Smart, which is part of Singapore-listed Golden Agri-Resources, got a mixed report card in an independent environmental audit. Greenpeace has accused the palm oil giant of clearing peatland and forests.
“The verification exercise was fine,” Vis said. “We are waiting for a response from Smart — a response in terms of an improvement plan or program to be put in place.
"So far, we’re encouraged by the level of cooperation we see from Smart with certifiers and the willingness they have to communicate and discuss the findings.”
Vis said Unilever wanted to see Golden Agri become a member of the RSPO, and make a public commitment to have all their holdings certified within a certain time frame.
Unilever expects to buy between 1.2 million tons and 1.5 million tons of palm oil this year, unchanged from 2009.
“It is a real mixed [economic] picture, so the real trick for a company, is to allocate resources into the markets that show potential for growth,” Vis said.
“Palm oil is the cooking oil of the two billion poorest people on the planet. Population growth is going to happen, so that’s where markets will grow — Central Asia, Africa, Southeast Asia.”
Reuters
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