Nestlé and Kraft probe palm oil sources after sustainability claims

By Mike Stones

- Last updated on GMT

Related tags: Palm oil, Oil palm

The globe’s two biggest food firms, Nestlé and Kraft, have launched internal investigations after a Greenpeace report claimed both purchase palm oil from Indonesian company PT Smart whose parent group Sinar Mas allegedly engages in widespread illegal deforestation and peatland clearance in Indonesia.

Greenpeace’s report, Illegal forest clearance and RSPO​ (Round Table on Sustainable Palm Oil) greenwash: Case studies of Sinar Mas​, claims it is “…engaging in practices which release vast amounts of carbon dioxide into the atmosphere and help Indonesia win the title of the world’s third largest greenhouse gas emitter, after China and the US​.”

A spokesperson for Nestlé told “PT Smart supplies a small volume of palm oil to one Nestlé market in South-East Asia.


“Nestlé has been made aware of the Greenpeace report as a result of Unilever’s public statement. Nestlé has immediately started its own investigations, reviewing the allegations that the report makes​.

“The company recently undertook a detailed review of its supply chain to establish the source of its palm oil supplies and has committed to using only "Certified Sustainable Palm Oil" by 2015, when sufficient quantities should be available​,” she added.

Kraft UK told "We can confirm we buy relatively small volumes of palm oil from Sinar Mas companies. We are reviewing the allegations against Sinar Mas and our relationship with them​.”

The company acknowledged that the production of palm oil can have what it termed “significant and lasting environmental and social impact.​” Although it buys palm oil from RSPO members, it conceded that more needed to be done to enforce guidelines and address deforestation.

The company revealed that it is working with the World Wildlife Fund (WWF) to gain a better understanding of the issue and all options available and plans to start purchasing certified palm oil in 2010.

Meanwhile, the Greenpeace report further claimed that Unilever and Proctor&Gamble also buy palm oil from PT Smart.

Unilever’s chief procurement officer, Marc Engel, said earlier this week: “Unilever is committed to sustainable sourcing. Therefore, we have notified PT Smart that we have no choice but to suspend our future purchasing of palm oil.”


“If PT SMART are able to come forward with concrete proof that they are not involved in unacceptable environmental practices then we would certainly re-consider our position​.”

Proctor & Gamble, which produces snacks, denies sourcing palm oil from PT Smart. A spokesperson told “P&G is committed to the sustainable sourcing of palm oil. By 2015 we intend to purchase and use palm oil that we can confirm to have originated from responsible and sustainable sources​.”

No one PT Smart or Sinar Mas was available for comment before publication.

But, following the showing earlier this year of what Sinar Mas described as “a Greenpeace theatrical show," ​entitled “Sinar Mas - Forest and Climate Criminal​," the company responded: “… the development of oil palm plantations that are part of current government programs tend to use marginal lands that have been degraded.

“That’s why the government encouraged the industrial sector - Sinar Mas by PT Sinar Mas Agro Resources and Technology… (PT Smart)…to develop this sector to promote environmentally friendly principles​.”

Related topics: Market Trends, Sustainability, Fats & oils

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