Corporate giants exposed to palm oil sourced from illegal clearances of Sumatran rainforest


Aerial view of recent land clearing by PT. Agra Bumi Niaga in East Aceh, Indonesia Photo: Rainforest Action Network

Some of the world’s biggest companies including Pepsico, Mars, Unilever and Nestlé may have sourced palm oil from illegally deforested land on the Indonesian island of Sumatra.

study by the Rainforest Action Network (RAN) used satellite data, photographic evidence and GPS coordinates to chart ongoing illegal clearances of primary rainforest in the Leuser ecosystem, in contravention of a moratorium imposed on deforestation of the 2.6m hectare wilderness in June last year.

The study shows how palm oil grown on land that was illegally cleared by the logging company PT Agra Bumi Niaga (ABN) may have ended up in the products of some of the world’s biggest brands. It pinpoints that ABN illegally cleared 336 hectares of rainforest between June 2016 and April 2017, part of a corridor of lowland forest essential for the survival of critically endangered Sumatran elephants.

PT ABN delivers fruit to nearby crude palm oil processing mills owned by PT Koperasi Prima Jasa (KPJ) and PT Ensem Sawita (ES), which sell on to some of the world’s biggest palm oil traders, including Wilmar and Musim Mas.

Unilever admitted to the Guardian that it had indirectly bought palm oil from PT ABN through Wilmar and Musim Mas, saying it had requested an “action plan” from the palm oil giants. Nestlé said that it was investigating the allegations with Wilmar, which is sending a team to assess whether other sources in its supply chain were using palm oil originating in PT ABN’s 2,000-hectare concession. Mars and Kellogg’s stressed their sustainable palm oil policies, while McDonald’s denied any links to PT ABN. Cargill and Musim Mas said they were investigating the reports.

Most of the firms implicated have sustainability policies that highlight the importance of traceable supply chains. PepsiCo’s sustainability policy aims to establish “clear agreements with customers, suppliers, and sub-contracted producers.” Unilever’s Sustainable Living Plan states the firm is “committed to sourcing 100% of agricultural raw materials sustainably […] Knowing where our raw materials come from enables us to work with others to co-create responsible standards.” Nestlé has a Responsible Sourcing Traceability Programme which “promotes transparency in our extended supply chains back to the farm or feedstock, implementing our commitments on no-deforestation.”

Leuser is among the world’s most biodiverse ecosystems, encompassing 6.5 million acres of lowland tropical rainforest, peatlands and mountains.

In response to deforestation within Leuser, Indonesian President Joko Widodo announced a moratorium on new palm oil permits in April 2016. Two months later, the governor of Aceh ordered palm oil companies to cease all forest clearances. RAN’s investigation indicates that ABN has illegally cleared another 336 hectares of rainforest since June 2016.

More from Blog

There Will Be Blood / Four key takeaways from our latest report

Continue reading
UK Environment Act / Analyses show exemptions would create dangerous loopholes

Continue reading

Leather / BMW fails to substantiate allegations against Earthsight’s research

Continue reading
It is essential that a mandatory public list of non-compliant businesses is included in the final regulation to curb EU-driven deforestation and forest degradation

Continue reading
Brazil / World’s largest sovereign wealth fund finds beef giant guilty of driving illegal deforestation

Continue reading
Grand Theft Chaco II / Paraguay Senate seeks accountability from government following Earthsight illegal deforestation exposé

Continue reading
EU anti-deforestation law / Suspect timber firms lobby for certified wood ‘green lane’ in draft proposal

Continue reading
Open letter / Paraguay must halt invasions, deforestation of indigenous Ayoreo lands

Continue reading
FSC hall of shame / The ethical wood label’s long line of scandals

Continue reading
Open letter / Ethical wood label FSC is no longer fit for purpose and must urgently reform

Continue reading

Stay up to date with all Earthsight news & updates

Receive email updates for the latest news and insights from Earthsight and be among the first to read our new investigations.

We keep your data secure and don’t share anything with third parties. Read full terms.