THE BLOG

Zero Deforestation Commitments the First Step Towards Certified Palm Oil

06/08/2015 04:49 pm ET | Updated Jun 08, 2016

It was only a few months back when this blog on Grist.org said that "rainforests were rejoicing because yet another palm oil grower made a commitment to produce palm oil without causing deforestation. This is the latest in a series of such commitments, and it means that 75 percent of all the palm oil produced will be grown without cutting down rainforests."
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The author never did reply to my question on how he figured out 75% of all palm oil produced will be grown without cutting down rainforests. It may be a simple matter of semantics but in my opinion, you cannot work out a percentage based on current volume of business. To achieve a 75% deforestation free supply of palm oil, these companies would have to triple their acreage if we assume that SOME of their current production is deforestation free.

Questionable statements aside, these commitments by the world's biggest palm oil producers and users should be celebrated. The first step towards solving any problem is to first acknowledge that there is a problem that needs to be fixed. However, we should keep in mind that these commitments are merely a pledge to work at becoming more sustainable. We should cheer the journey that these companies are taking on but we should not lose sight of the destination, which is to see sustainably produced palm oil being used in products we buy.

Tracing Palm Oil Supplies as a Good Next Step Forward

Beyond commitments, the needed next step is to find out where the palm oil is coming from. One of the world's largest producer of consumer products, Unilever, is working towards eliminating deforestation from its products by 2020. To date, they've been able to trace 70% of their palm oil supply back to the mill which is good news but its only the beginning. Historically, all palm oil from Indonesia and Malaysia involved the removal of rainforests and Unilever knows that what they find at the mill, may not be pretty. This is why their policy on palm oil includes transforming their supply chain so that all of it is traceable and sustainable by 2020.

Tracing it should be easy enough as I highly doubt a corporation of their size would work with suppliers that do not keep logs on raw material supplies. It's the sustainability of their supply that maybe questionable. The only global certification body for palm is the Roundtable on Sustainable Palm Oil or the RSPO as its commonly called. The best news I've seen in recent times (zero deforestation commitments did not qualify as good news) is this letter from a group of institutional investors to the RSPO this week. The investors hold 5 trillion dollars worth of assets that can break or change an industry.

Palm oil is traded on the commodities market and subject to competition which means if its main competitors in soy or canola have a bumper harvest, the price for crude palm oil will fall as these commodities fight for market share. This is not a fair fight for producers of sustainable palm oil who have invested in better practices like ensuring fair prices for their small farmers or lost economic efficiencies by giving up portions of licensed farm lands to conservation. Sustainability carries real costs that adds heavily into production costs. These global investors can help better palm oil producers to continue their journey towards sustainability practices by keeping their stock prices high even if the producers are not showing the desired profit levels demanded by traditional investment houses.

Certified Palm Oil as the Destination

Readers should note that there is a huge misunderstanding of the RSPO and the palm oil it certifies. Being a member of the RSPO means absolutely nothing except when it comes to getting the organization blamed as a whole. For example, Pepsico is a user member of the RSPO BUT does not use certified palm oil. SOCFIN Group is a grower member of the RSPO but has a weak target of 2019 to meet 100% certification.

In my humble opinion, the RSPO should drop these dead weights that are holding back their progress. I know they won't as the RSPO in its goal to make sustainable palm oil the norm rather than a niche, has to hope the prodigal sons will come home. For that reason and as a consumer that wants to support brands that make sustainable products, I will continue to support brands like Unilever to help them along their journey towards using 100% certified sustainable palm oil.

As a hobby gardener, I've learned that not every seed planted will grow. Some seeds may even sprout before failing. Commitments to zero deforestation or no deforestation are the seeds of sustainability. Certification is the fruit we want to see from those seeds