GreenPalm defends palm oil certificate trading

By Jane Byrne

- Last updated on GMT

Related tags Palm oil

palm oil - a complex supply chain
palm oil - a complex supply chain
Certificates, mass balance and fully segregated palm oil options are not mutually exclusive, but all serve to ensure flexibility in an extremely complex supply chain, claims GreenPalm.

The organisation behind the RSPO backed palm oil certificate scheme has restated the benefits of the programme in bringing sustainable palm oil to the market, in light of what it calls "misleading"​ claims about it from leading palm oil producer.

Earlier this month, the supplier of the food, cosmetics and homecare product ingredient, New Britain Palm Oil Limited (NBPOL), said a deal to increase the supply of sustainably certified segregated palm oil (CSPO) into Europe could herald the demise of the GreenPalm certification system.

Alan Chaytor, executive director of NBPOL, told this publication that many industry players “view green certificates with a great deal of suspicion as to what effect, if any, purchasing them has on making the palm oil industry sustainable.”

But Bob Norman, general manger of GreenPalm has retaliated, saying: “The NBPOL comments were not in the spirit of the Roundtable on Sustainable Palm Oil (RSPO).

Furthermore, NBPOL is a registered certificate owner under the GreenPalm scheme, which makes the company’s remarks all the more surprising.”

Wide net

And New Britain, continued the GreenPalm boss, only referred to the European market in its comments and did not take into account the fact that very little of global palm oil production is actually destined for European manufacturers’ use.

The RSPO-approved GreenPalm certificate trading scheme, argues Norman, enables RSPO certified producers to earn more – $14m in additional income - for their efforts, wherever they are in the world and, crucially, not whether they export to Europe.

In addition, the certificate sales, he stressed, have supported the production of 1.8 million tonnes of certified sustainable material.

“GreenPalm is engaged therefore in a much wider campaign, with global reach, rather than limiting itself to producers who already deliver to Europe,”​ added Norman.

He told this publication that for users of palm or palm kernel derivatives, which are “not yet available from certified sustainable sources in sufficient quantities,”​ the GreenPalm programme makes sense as it allows them to “contribute to sustainable production and make supporting claims.”

Kellogg's recently announced an increase in the volumes of its global output that were to be covered by the GreenPalm scheme.

Complex supply chain

Most palm oil is produced through processes that see large quantities from multiple sources mixed to achieve the critical mass practical for refining, and then again for transportation.

And the GreenPalm boss argues that the processing infrastructure is not yet in place and will be some years off in terms of ensuring the availability of large volumes of CSPO palm oil derivatives such as stearin, a useful source of fully natural hard fat component for products such as shortening and pastry and bakery margarines.

Moreover, in relation to the allegations by NBPOL that the offset scheme was “unaudited and therefore open to abuse,”​ Norman stressed that, on the contrary, every aspect of the GreenPalm programme is RSPO audited and fully transparent, with “strong and clear rules.”

Every certificate sold is directly supporting RSPO certified production from audited producers. Buyers and redeemers of GreenPalm certificates are recorded, and open to public scrutiny,”​ he said.

The challenge now for the RSPO, said the GreenPalm boss, is to increase the number of independent smallholders – which make up 40 per cent of the world’s palm oil producers - that are RSPO certified.

Global production

About 54 per cent of the world's current RSPO-certified palm oil production capacity is in Malaysia. Indonesia is second, with about 35 per cent of the current global supply.

Papua New Guinea and Colombia provide the remaining 10 per cent and 1 per cent, respectively, according to RSPO data.

Meanwhile, that RSPO today announced that certified palm oil production facilities produced their five-millionth tonne of certified sustainable palm oil earlier this month.

And the NGO and industry backed group said that the current estimated annual production capacity of RSPO-certified production units equals about 9 per cent of global production, estimated to be about 46 million tonnes annually.

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