Why sourcing sustainable palm oil matters

Palm oil is the world's most widely used vegetable oil. It appears as an ingredient in many food and non-food products, such as soaps, biscuits, cosmetics, animal feed and cleaning products. Global demand for palm oil is increasing rapidly and is set to double by 2020.

By 2050 the population is expected to grow to 9-10 billion people. This could result in a 70% increase in the demand for food. An increased demand for food coupled with decreasing land availability and a shortage of water means that crop yields must increase in order to prevent further land use and environmental damage. Palm oil is the highest yielding oilseed crop in the world and can therefore help to meet increasing food demands while minimising land usage.

Palm oil is pressed from the flesh of the fruits of the oil palm tree and palm kernel oil is produced from the kernel of the fruit. Oil palm trees are highly productive, capable of producing 4-10 times more oil than other crops per unit of cultivated land. Indonesia and Malaysia produce nearly 90% of the world's palm oil and are home to large scale plantations, which are often important parts of the local economy. In Indonesia, approximately 40% of palm oil is produced by smallholders who rely on palm cultivation as their sole source of income, and in Malaysia it is approximately 10%, according to RSPO figures. Palm oil therefore plays a key role in improving the livelihoods of farmers in the developing world.

Unfortunately, in some areas, oil palm cultivation has caused – and continues to cause – deforestation. Land which was once covered by tropical forest has been cleared and converted into palm oil plantations. These tropical forests act as vital carbon stores and provide a home for indigenous people and a huge number of plants and animals, including critically endangered species such as the orangutan and Sumatran tiger. Destroying these forests drives climate change and biodiversity loss.

The international community, industry, investors and consumers are increasingly concerned about deforestation and the role that agricultural products such as palm oil play in driving it. The UK government, WWF UK, FDF and other trade associations representing sectors in the UK palm oil supply chain have agreed an ambition of 100% sourcing of credibly Certified Sustainable Palm Oil (CSPO) by the end of 2015. The final progress report found that “the imports of segregated and mass balance CSPO and purchases of GreenPalm certificates by UK companies in 2015 were equivalent to an estimated proportion of 87% or 108% of UK palm oil imports (excluding derivatives and finished goods), depending on the baseline trade data used.”

Following the conclusion of the 2015 ambition, FDF, along with an alliance of industry associations and NGOs in the UK, signed the Amsterdam Commitment to support 100% Sustainable Palm Oil in Europe by 2020.

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Last reviewed: 07 Dec 2017