Could Europe’s drive to segregated palm oil exclude small producers?

By Caroline SCOTT-THOMAS contact

- Last updated on GMT

Norman argues that with only 20% of the world's palm oil certified as sustainable, there's still a need to focus on production rather than the end product
Norman argues that with only 20% of the world's palm oil certified as sustainable, there's still a need to focus on production rather than the end product

Related tags: Palm oil, Europe, Petroleum

A European push toward segregated certified sustainable palm oil may inadvertently exclude smaller producers from the supply chain, says GreenPalm manager Bob Norman.

RSPO-certified sustainable palm oil accounts for about 20% of the global palm oil supply, but demand has yet to catch up with supply. Meanwhile, smallholders contribute about 30 to 40% of global production, and in some regions, they account for most palm oil imports – 70% in Thailand and 80% in Latin America, for instance.

Norman argues that GreenPalm certificates still have a part to play in driving the whole supply chain toward sustainable production – although NGOs say that GreenPalm allows companies to make misleading claims about their palm oil use, and have been pressuring them to move toward physical sustainable oil.

“There’s always been this mindset that the GreenPalm system was to get the whole thing started – and in the early days it was how we had worked with the RSPO,”​ Norman told FoodNavigator. “…As the years have rolled on, these supply chains have not got any simpler. If the European marketplace converted to traceable segregated supply chains, it would exclude a lot of people.”

He claims the GreenPalm system is particularly important for supporting smallholders and independent mills without a route to export.

“GreenPalm enables those parties to be involved in transforming the palm oil industry, and it also offers buyers traceability back to a specific, chosen producer and soon back to mill level for integrated producers,”​ he said.

Norman says the Roundtable on Sustainable Palm Oil (RSPO) should be as inclusive as possible, rather than exclusive.

Decoding sustainable palm oil claims

Segregated: If you want to use the RSPO trademark and claim ‘This product contains certified sustainable palm oil’, you must use palm oil that has been segregated throughout the supply chain and is traceable directly back to its RSPO-certified source.

Mass balance: This combines some segregated RSPO certified oil and some standard oil, and allows users to use the RSPO trademark (‘Mixed’) and claim: ‘Contributes to the production of certified sustainable palm oil’.

GreenPalm (book and claim): Buyers of GreenPalm certificates are guaranteed that a tonnage of palm oil/derivatives equivalent to the tonnage they use has been produced from RSPO-certified plantations. While you can't guarantee the actual oil you are buying is sustainable, you know the amount you use has been produced sustainably. Participants can use the GreenPalm logo and claim: ‘Supports the production of RSPO-certified sustainable palm oil’.  

“The challenge is to stimulate overall demand and to allow certified sustainable palm oil to be inclusive. We have to ask the question: Do you want to change the industry at its very core, or just the physical material you use in your products? If it’s the former, we have to make it possible for everyone to be involved,” ​he said.

While many European countries and palm oil users have said they aim to use 100% traceable palm oil, often by 2020, Norman says this is likely to be a difficult target to reach – and not necessarily good for stimulating sustainable palm oil production beyond that intended for use in Europe and other economies where palm oil is mainly used in branded products.

“The majority of palm oil that’s used on this planet is unbranded,”​ he said. “We have got to look beyond Europe and at the real buyers of standard palm oil. Those are the people who will really drive the market. What we need to do collectively is focus on the growers.”

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2 comments

"Fair" Trade = Unfair Trade

Posted by Hugo Cabret,

Government intervention and regulation NEVER improves anything. Bloated bureaucratic regulation and administration often exacerbates the issue or creates "solutions" to non-existent problems. "Fair Trade" is a perfect example. Big Government meddled in the marketplace and achieve the antithesis of its intention: Unfair trade. Unfair trade regulation creates increased economic impact on the large companies resulting in higher prices for consumers, and the small companies are driven out of business. Great job, folks!

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Small producers need to set up co-op

Posted by TC,

Small producers need to set up a coop. This will help them all produce quality product in a more sustainable manner and may even increase their production and efficiency. This has worked very effectively in other supply chains such as milk and produce.

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