Traceability & Transparency in the Palm Oil Supply Chain
Palm oil is the largest edible oil crop on the planet, produced in areas of the world where there is great biodiversity. This means that it’s crucial that palm oil is grown and processed sustainably. Great progress has been made – but how can we know whether the companies we buy from are using sustainable oils or not? The solution here lies in fully traceable and transparent supply chains for palm oil.
Why does it matter?
With such a long supply chain, traceability is an important way to allow people to be sure they are buying palm oil that is sustainable and has not caused deforestation. It also keeps companies accountable, and it makes visible which companies are investing, buying and using 100% sustainable and deforestation-free palm oil.
This means the ability to track and trace where the palm oil that companies use to refine actually comes from. The supply chain can be long, involving many companies both large and small – traceability is not always as simple as it seems. Imagine a palm oil mill, where the raw fruit is turned into crude palm oil; that mill can take palm oil from many small suppliers, mostly within 50km radius of the mill. Then the crude oil is transported (usually by ships, which may pick up further oils along the way) to refineries around the world. There it is made into refined oil and used in everyday consumer products.
We also need transparency in the palm oil supply chain – honest, open communication at all stages in the process, which celebrates the successes and flags up the steps needed to make further progress and meet all goals. It also allows growers and companies to share best practices with others in their industry and drive up standards across the whole sector. It also helps to educate others who may not be aware of the issues involved, and the progress that has been made so far.
When companies say that they are being environmentally responsible and using palm oil from sustainable and deforestation-free sources, there has to be a way of verifying this. When international monitoring organisations give certifications to companies for their good practice, people need to be able to see why they were given, what the standards are, and how they can be reached.
What is the industry doing to increase traceability and transparency?