Premier Foods plc, the maker of Mr Kipling cakes and Hovis bread, has stood by its decision to use palm oil sourced under the controversial GreenPalm scheme.

The UK's largest food group said the intiative, which has signatories including Marks and Spencer but which has faced criticism from environmental campaigners, said the programme encourages palm oil growers to think more about the environment.

GreenPalm works by giving palm oil producers certified by the Roundtable on Sustainable Palm Oil one GreenPalm certificate for each tonne of palm oil they produce sustainably.

Manufacturers and retailers bid for and buy the certificates online as a means of helping the production of sustainable palm oil.

Critics argue that GreenPalm is not a fool-proof answer to encouraging more production of sustainable palm oil, which is vital to protect rainforests.

GreenPalm's detractors claim that, when the sustainably-produced palm oil sold under the scheme is shipped, it is not kept separate from oil made from plantations created by chopping down rainforests.

However, Premier told just-food that its use of GreenPalm palm oil was a step towards the company sourcing certified sustainable palm oil (CSPO) that is shipped in a segregated and traceable manner.

"It is quite true that, presently, palm oil from different plantations, mills and even countries are intermingled at each stage of the production and delivery process," the company said.

"[But] Premier Foods' participation in the GreenPalm programme enables a financial premium to be earned by producers who can prove they are environmentally and socially responsible, who are not destroying primary forest, and who develop plans to continually improve their operations."
The company added: "We see our participation in the GreenPalm programme as a stepping stone to sourcing 100% CSPO blended product as this becomes available on the UK market. It is important that we send a strong message to palm oil producers and processors that there is an existing, and increasing, demand in the UK for 100% segregated and traceable blended CSPO."

UK-listed processor New Britain Palm Oil is close to completing the construction of a refinery in Liverpool that has promised a "dedicated supply source" from its plantations to the refinery.

Last month, United Biscuits, the UK group behind McVitie's and Jacob's, secured a deal for palm oil supplies from the Liverpool site and Premier said it was in talks with the processor.

"A significant amount of the palm oil we use is as a blended product, or derivative of palm oil. At this moment in time there is no blended palm oil in Europe containing CSPO," the company explained.

"We see our participation in the GreenPalm programme as a stepping stone to sourcing 100% CSPO blended product as this becomes available on the UK market.

"We are in discussion with New Britain Palm Oil, and other major Palm Oil suppliers, on this issue. We plan to source 100% 'identity preserved' blended palm oil as this becomes available."