Cargill and World Wildlife Fund Agree to Assess Palm Oil Sustainability Among Suppliers

With the growing demand for palm oil in both food and non-food applications, Cargill recognises it is critical that all parts of the palm oil supply chain – from plantations to retailers – act in an environmentally sustainable and socially responsible manner.

9 Jul 2010 --- Cargill is collaborating with the World Wildlife Fund-U.S. (WWF) to undertake an assessment of its palm oil suppliers in Indonesia as part of its continued commitment to sustainable palm oil production. The assessment will help gauge current progress amongst Cargill's suppliers to implement the principles and criteria established by the Roundtable on Sustainable Palm Oil (RSPO).

"We are committed to helping lead efforts to move the palm oil industry towards more sustainable palm oil production," said Paul Conway, senior vice president at Cargill. "We already have responsible palm production policies on our own plantations and we want to play our part by working with the industry and the Indonesian government to encourage the adoption of sustainable production practices. WWF's extensive experience will help us assess progress amongst our suppliers and will enable us to work with each supplier to implement the standards set out by the RSPO."

The assessment will begin in August 2010 and the first phase will prioritise estates from Cargill's key suppliers with the highest biodiversity concerns. WWF will supervise the overall process including the design and the selection of local environmental experts to do the field work and in-person visits to plantations. The assessment will identify progress on key areas such as land permitting, and environmental and social practices.

Cargill will release a summary of the overall findings and resulting action steps after the first stage of the assessment, which is expected to be complete in early 2011.

"This project is very important to WWF because it will help move the palm oil industry to higher levels of performance," said Jason Clay, senior vice president of markets at World Wildlife Fund. "Through engagement with businesses like Cargill, we can drive market transformation by creating linkages between performance and markets. This agreement allows us to affect positive change on the ground, so together we can create a process to drive continuous improvement of responsible sourcing practices."

With the growing demand for palm oil in both food and non-food applications, Cargill recognises it is critical that all parts of the palm oil supply chain – from plantations to retailers – act in an environmentally sustainable and socially responsible manner. The company will be using the assessment as a basis to address gaps against the RSPO standard and will work with suppliers to implement solutions to improve sustainable palm production practices.

Cargill has set a goal of buying 60 percent of its total crude palm oil from RSPO members by the end of 2010. It is encouraging its suppliers to join RSPO and to attain certification for all of their oil palm plantations.

Cargill's oil palm plantation, PT. Hindoli in Sumatra, Indonesia has received the RSPO certification and smallholders at this plantation are scheduled in the next few months to be the first to be RSPO certified. It also is working towards getting RSPO certification for its other palm plantation, Harapan Sawit Lestari. Cargill's European and Malaysian refineries also have received approval to offer RSPO products. The company has its own policies in place for responsible palm production on its own plantations including commitments to not plant on high conservation value forests (HCVF); to not develop new plantations on deep peat land or land that would threaten biodiversity; and a strict no-burn policy for land preparation.