STATE OF NEGERI SEMBILAN, MALAYSIA (JANUARY 30, 2019) (REUTERS) – Some of the world’s biggest palm oil users, including Nestle, Unilever and Mondelez are trying out new satellite technology to monitor deforestation, as pressure grows on them to source the ingredient responsibly.
They say the monitoring systems allow them to target people felling trees in producing countries like Malaysia and Indonesia, where forests are shrinking, more efficiently than policing supply chains on the ground.
“What we’re gaining is an ability to monitor the entirety of our supply chain whether it is certified yet or not,” Nestle’s global responsible sourcing leader for palm oil and seafood, Emily Kunen told Reuters.
“It gives us real-time information. It also alerts us if anything is changing,” she added.
Nestle, target of a 2010 video by Greenpeace International depicting a stick of KitKat bar as an orangutan finger, was back in the headlines last year when it was briefly suspended by the Roundtable on Sustainable Palm Oil (RSPO) for not showing how it would scale up purchases of certified palm oil.
From next month, it plans to publish data online from an Airbus-developed satellite system called Starling, to “put responsibility on the mill” that extracts oil from palm fruit.
Nestle says that once a Starling deforestation alert is verified, it will ban the offending supplier after 60 days of engagement unless it cleans up its act, although the firm has not yet suspended any since rolling out this new model last month.
Italy’s Ferrero Group, which only buys RSPO-certified palm oil that has been separated from the rest, has tried Starling, but the Nutella maker said it is still assessing results of its pilot to decide whether to keep using it.
GFW Pro will be free, to encourage everyone to use it, but producers say low benchmark palm prices and the difficulty in securing a premium price make it difficult to offset the costs of taking action based on data from such platforms.
Interviews with leading brands, commodity traders and plantation owners show the systems have limitations and opinions on them vary, reflecting tension within the industry over how to tackle an issue with no easy answer.
“Our focus on engaging mills is not on segregating out sustainable and not-sustainable, but working with companies and working with mills to implement systems to really transform the industry as a whole and transform supply chains as a whole,” Kunen said.
Palm oil buyers have toyed with satellite imagery for years, but have now ramped up their use as they rush to meet a pledge of zero net deforestation by 2020, set by global umbrella body the Consumer Goods Forum.
The oil is in nearly half of all packaged goods from chocolate to soap, and is also used as a cooking oil and in biofuel.
Palm oil is still cheaper than alternatives but several supermarkets have cut back or stopped using it, including SPAR in Austria and Coop in Italy, citing health and environmental concerns. Italy’s Barilla is also challenging Ferrero’s Nutella with a chocolate spread without the oil.
European Union lawmakers are set to phase out palm oil in transport fuels from 2030, angering producing countries, which see the export as key to economic growth and poverty reduction and have threatened retaliation.
But world demand is poised to continue expanding fast as incomes climb in developing nations.
Palm oil contributes less to deforestation than beef or soy, which are responsible for much of the destruction in the Brazilian Amazon. But it has garnered attention because it thrives in biodiverse regions, threatening endangered species and exacerbating global warming.