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Cargill adopts ‘greener’ palm oil policy

Agribusiness giant Cargill will ensure all palm oil supplied to customers in Europe, United States, Canada, Australia and New Zealand is certified under the Roundtable on Sustainable Palm Oil (RSPO), an environmental standard, or originated from smallholder growers by 2015, according to a statement issued by the company. Cargill says it will extend the commitment to 100 percent of its products and customers globally – including China and India, the largest consumers of palm oil – by 2020.

“Cargill is an active supporter of sustainable palm and has been a member of the RSPO since it was founded. We hope this commitment will encourage more participation across the supply chain and help RSPO palm oil become the mainstream,” said Paul Conway, vice chairman of Cargill, in a statement. “This goal will help us meet the rising demand for sustainable palm oil products amongst manufacturers and retailers, while continuing to encourage palm oil producers to adopt more sustainable practices.”

Cargill’s commitment — which does not extend to palm kernel oil products, demand for which is growing rapidly — may boost demand for RSPO-certified products ahead of the RSPO’s launch of a trademark to help customers distinguish between non-certified and certified palm oil. Europe and Australia recently passed legislation requiring the listing on individual vegetable oils — including palm oil — on product labels, but the RSPO supporters say the RSPO trademark could help allay the fears that palm oil used in processed foods has been sourced through the destruction of rainforests and carbon-dense peatlands.

Nevertheless one of Cargill’s fiercest critics, the Rainforest Action Network (RAN), said the commitment did not go far enough.

“Cargill’s move to phase out controversial palm oil from its supply chain is a good first step toward protecting our most endangered rainforests and the climate, but it comes at a time when we need leaps, said Lindsey Allen, Forest Program Director for RAN. “Palm oil is a leading cause of Indonesia’s deforestation, greenhouse gas emissions and loss of critical orangutan habitat, and the next five years are crucial. The sad reality is that we can’t wait until 2015, let alone 2020, for greater corporate leadership.”

RAN wants Cargill to accelerate its timetable for RSPO adoption and to include palm kernel oil (PKO).

“By excluding PKO, Cargill will fail to supply certified palm oil for many of the products we buy in supermarkets every day and fail to meet the rising demand of it customers,” said RAN.

RAN also warns that RSPO-certification alone is not enough to ensure sustainability of palm oil. It notes that companies with RSPO-certified plantations in Indonesia and Malaysia have recently been caught converting peatlands (KLK subsidiary PT Menteng in Central Kalimantan in Indonesian Borneo) and causing conflict with local communities (IOI Group in Sarawak, Malaysia). Both issues are now under investigation by the RSPO.

Cargill says it has confidence in the RSPO grievance process for investigating and settling disputes.

“RSPO requires its members to act in a sustainable manner and meet the RSPO’s code of conduct,” Cargill told last month. “We fully support the RSPO and agree that allegations of unsustainable practices should be brought to the RSPO to review through its official grievance process. The RSPO grievance panel consists of stakeholders in the palm oil supply chain, including NGOs.”

Cargill says it is working with World Wildlife Fund-U.S. to evaluate its palm oil suppliers’ progress in implementing RSPO Principles & Criteria.

“We remain very committed to working with WWF and all our suppliers to help find ways to implement more sustainable production practices,” said Conway. “While this process has proved to be more complex and taken longer than everyone first envisioned, we believe this long-term initiative will support producers to meet the rising demand for more responsible palm oil.”


RSPO was formed in 2004 as a response to concerns that palm oil production has driven large-scale destruction of rainforests across southeast Asia over the past two decades. RSPO has created a set of criteria to make palm oil production less damaging to the environment and local communities. These include using natural pests and composting in place of synthetic pesticides and fertilizers whenever possible, implementing no burn policies, sparing high conservation value forests from development, taking measures to reduce air pollution, and creating catchment ponds to prevent palm oil mill effluent from entering waterways where it would damage aquatic habitats. The hope is that CSPO can be sold at a premium to recoup the increased costs that certification entails.

RSPO has at times been criticized for being slow to act when members are found to be operating in violation of productions standards, but the body has recently rebuked IOI Group, a Malaysian producer, and Golden Agri Resources (GAR), a Singapore-based firm, for social and environmental transgressions. GAR has since taken steps to come back into compliance, including establishing a forest policy that is among the strictest of any palm oil major. GAR is a Cargill supplier.

Follow up clarification from Cargill:
Plantations improving sustainable practices and becoming RSPO-certified will improve the sustainability of palm oil AND palm kernel oil, because oil palm trees produce both. RSPO focuses on certifying palm oil through the whole supply chain because it’s the main product of the two. It doesn’t mean the palm kernel oil isn’t sustainable.

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