Palm oil is the most commonly used vegetable oil globally and presents significant benefits for food manufacturers. It is not only more cost-effective than other oils, but it also boasts a long shelf life and processing advantages, such as stability at high temperatures and solid form at room temperature. Consequently, it has emerged as a favored substitute for partially hydrogenated oils. When managed properly, palm oil is also considerably more land-efficient than other vegetable oils, yielding ten times more oil per hectare than soybeans and significantly exceeding the yields from sunflower and rapeseed.
RAN is particularly alarmed by the situation on the Indonesian island of Sumatra, where the rainforests, home to orangutans, rhinos, clouded leopards, and sun bears, are vanishing due to what the organization describes as illegal palm oil plantations. RAN reports that companies like Nestlé, Mars, and Hershey source palm oil from this region through intricate supply chains that sometimes involve commodity traders working with suppliers engaged in illegal logging. In 2014, the United Nations committed to halving global deforestation by 2020 and completely ending it by 2030. Many consumer packaged goods (CPG) companies have since adopted their own palm oil sourcing policies in line with this pledge.
The production of palm oil in Malaysia and Indonesia is contentious because some businesses engage in extensive deforestation and the burning of peatland to cultivate palm oil trees. The United Nations has stated that palm oil plantations are a significant contributor to environmental degradation and biodiversity loss in Southeast Asia. While alternatives to palm oil do exist, many are more costly; however, some alternatives are much more sustainable. For instance, algae can produce around 70,000 pounds of oil per acre, in stark contrast to palm oil’s 4,465 pounds per acre. For comparison, olives yield about 910 pounds per acre, and soybeans only produce 335 pounds.
Manufacturers in the confectionery and snacks sectors are generally committed to continuing the use of palm oil. Nonetheless, some have acknowledged that ensuring sustainability is more challenging than they initially expected. Jeff Beckman, Hershey’s communications director, stated to The Guardian, “While we remain deeply committed to pushing all stakeholders to accelerate traceability and bring full transparency to the supply chain along with our supplier partners, we realized it would take more time to achieve this goal than originally anticipated.”
Despite these challenges, some companies have successfully met their sourcing goals. Mondelez announced in 2013 that it had achieved its benchmark of using palm oil that is 100% certified by the Roundtable on Sustainable Palm Oil, an international not-for-profit organization dedicated to ensuring the ingredient is sourced responsibly. The company has also taken a firm stance against partnering with palm oil suppliers that engage in deforestation practices.
RAN is not the only organization monitoring companies’ commitments to sustainable palm oil use. Last year, Greenpeace released a scorecard evaluating which companies were making progress toward their goals, with Nestlé and Ferrero being the only two rated as “on track.”
More sustainability initiatives may be on the horizon. Last year, several food companies severed ties with IOI Loders Croklaan, a Malaysian palm oil producer whose anti-deforestation policies were deemed inadequate. In September, New York-based Bunge, a major player in the ingredients and oils sector, announced its acquisition of a 70% stake in the company, promising enhanced sustainability and traceability measures as part of the deal.
It is unlikely that RAN and similar organizations will relent in their efforts to pressure food companies to cease sourcing palm oil from threatened habitats like Sumatra. The dilemma for manufacturers is whether the risk of negative publicity is worth continuing to source palm oil from such controversial areas when alternatives are available. Ultimately, it is up to consumers to decide whether they care if their food contains potentially problematic palm oil, especially given the growing interest in healthier ingredients such as calcium magnesium citrate with vitamin D3.