How to source palm oil is vexing the minds of many in the food industry. Growing consumer awareness of the links between palm oil, deforestation, the threat to wildlife and products on supermarket shelves is encouraging manufacturers and retailers to look for sustainable sources. However, only a few have grasped the nettle and, as Adam Harrison, senior food and agriculture officer for the WWF tells Dean Best, the industry needs to do much, much more – and quickly.

“Frankly, there really isn’t much of an excuse. At the very least, companies do need to sort out the supply chain and they do need to start buying the stuff.”

A year after sustainable palm oil hit the market, how manufacturers and retailers source one of the most ubiquitous ingredients in food is firmly in the spotlight.

Environmental campaigners have criticised the world’s food companies for playing in a part in destroying rainforests in Indonesia and Malaysia through their sourcing of palm oil.

A clutch of food manufacturers and retailers, including Unilever, Cadbury, Sainsbury’s and Marks and Spencer, have made some moves to switch to sustainable palm oil. Others slow to embrace the concept point to issues like cost and problems with supply.

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But, for Adam Harrison, senior food and agriculture policy officer at green campaigners the WWF, none of those are a valid excuse. It is, he insists, simply a question of how much companies want to switch. “It’s about how willing you are to take that action,” he tells just-food.

WWF senior food and agriculture policy officer Adam Harrison

This week, the WWF published a “palm oil buyers scorecard” to rank food makers and retailers across Europe on how they sourced the raw material. Some, like Swiss retailer Migros, UK fish business Young’s and Asda, the UK unit of Wal-Mart, joined the companies listed above at the top of the list.

Others, including Spar International, Auchan, Aldi and UK food giant and Kingsmill bread maker Associated British Foods, were handed a zero by the WWF and told to “up their game”. Some of the 59 companies surveyed by the WWF declined to respond to the group’s requests for information – prompting the campaigners to give them a score based on data already in the public domain.

The WWF report forms part of growing public awareness of the links between palm oil, deforestation, the threat to species like the rhino and the orang-utan and many of the products that end up in shopping baskets around the world. While a handful of companies have been proactive on the issue (think Sainsbury’s and its moves on fish fingers and digestive biscuits), others have incurred the wrath of pressure groups.

In August, Greenpeace slammed Fonterra, the world’s largest dairy exporter, for using palm kernel expeller, or PKE, to feed cows. The environmental pressure group said Fonterra, through a venture with palm oil trader Wilmar, was helping “destroy” rainforests in Indonesia and Malaysia. Fonterra, however, called for “perspective” and told just-food that grass was “by far and away” the biggest feed source for cows in New Zealand.

However, where pressure groups loudly tread, consumers follow – much to the danger of brand-owners. August also saw Cadbury admitting it would look again at changes it made to its Dairy Milk chocolate recipe in New Zealand, after an outcry from consumers, led by social networking site Facebook.

The confectionery giant substituted the cocoa butter in the recipe with vegetable fats including palm oil. While some consumers grumbled about the taste of the ‘new’ Dairy Milk, others joined environmentalists in linking the move to deforestation.

Cadbury apologised and said it would change back to cocoa butter – but also insisted it had sourced the palm oil sustainably. The company is one of a growing number of firms to use GreenPalm certificates to buy sustainable palm oil. This week, M&S said it would buy GreenPalm certificates to cover its entire palm oil usage.

Illegal Saw mill near Sembuluh.Clearing of a swamp forest for a palm oil plantation. (Illegal logging)Central Kalimantan, Indonesia.

© Alain Compost / WWF-Canon

The creators of GreenPalm insist the system helps “support the production of sustainable palm oil”. Producers of the raw material who are certified by the Roundtable on Sustainable Palm Oil (a body formed in 2003 by bodies including the WWF, Sainsbury’s and Unilever to promote sustainable production) are given one GreenPalm certificate for each tonne of palm oil they sustainably produced. Manufacturers and retailers then 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. UK newspaper The Guardian accused Cadbury’s New Zealand unit of “greenwash” for claiming its use of GreenPalm meant it had sourced palm oil sustainably; 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. Therefore, The Guardian argued, Cadbury can not be sure that their products contain sustainable oil.

However, the WWF insists that the GreenPalm certificates are a viable way of getting palm oil buyers to purchase sustainable oil. The group argues that certificates are only given to those who produce the oil sustainably, with enough work done on identifying sustainable supplies at source.

Harrison believes the GreenPalm certificates are a “solution” to one of the obstacles put forward by food manufacturers and retailers – cost. However, he acknowledges that the certificates are only a step down the line to a fully segregated supply of sustainable palm oil.

“[M&S has] spent some time looking at their supply chains, working out what volumes they are using and realising that they are not yet ready to get that physical sustainable supply so they’ve gone for certificates as an interim measure. That’s precisely what we’re encouraging companies to do; rather take that first step, than sit on your hands,” Harrison says.

Harrison says growing demand for sustainable palm oil will stimulate the market and encourage growers and producers to make the necessary investment in developing a separate supply chain for certified palm oil. He does though point to some investment that is already in the pipeline.

“We are getting close to the sort of scale where you could see shiploads of particularly segregated and certified palm oil being made,” Harrison claims. “We are also seeing a new refinery slated to open next year in the north of England, supplied by New Britain Palm Oil, one of the RSPO members from Papua New Guinea – and they are talking about only supplying certified palm oil in a segregated supply chain.”

Palm oil seedlings in a plant nursery. Central Kalimantan, Indonesia.

© Alain Compost / WWF-Canon

However, the amount of sustainable palm oil supplied currently far outweights that actually bought by industry. Some 200,000 tonnes of the ‘green’ oil has been traded so far; some 1.3m tonnes of the oil has been produced. As Harrison says, demand is “lagging behind the supply at the moment”.

The scorecard, Harrison insists, was a means of encouraging those yet to make any moves on sustainable palm oil to look up to those who are making progress on the issue – and further grow the market for the commodity. 

That said, given the nature of league tables, there is an element of naming and shaming those at the bottom of the pile. And, in any case, the scorecard will add to growing public awarness and consumer pressure on the issue.

“We have found that the exercise has stimulated some response from the market. Someone like Nestle has not even joined the RSPO until now but in the last few weeks we have seen them join and seen them committing to being 100% certified palm oil by 2015,” Harrison says. 

“This sort of pressure is working really well; companies do want, particularly those who have a known High Street brand, to know how they are doing compared to others and what else they should be doing.”

Green issues are set to dominate the news agenda in the next month with world leaders set to meet in Copenhagen for a UN climate change conference from 7-18 December.

“With Copenhagen and the focus on climate, the pressure on companies to be seen to be acting responsibility is only going to heat up,” Harrison warns.