Palm Products

Eradicating unsustainable palm oil products from our supply chain.

There is growing consumer concern about the social and environmental impacts of the establishment of palm oil plantations, which can lead to deforestation and carbon emissions – and it’s a concern that we share.

In a move to eradicate the use of non-sustainable palm oil in our business, we’ve introduced a range of measures.

Since 2009, we have been a member of the Roundtable on Sustainable Palm Oil (RSPO) – a non-profit organisation set up by WWF that brings together stakeholders from along the palm oil supply chain to develop and implement global standards for sustainable palm oil.

All palm oil used in Fonterra products sold in Australia is RSPO Certified. RSPO Certified palm oil is used in our spread blends, with some smaller amounts used in crackers and dips for our snacking products. For all Fonterra products containing palm oil, we are moving to “Segregated” oils which is a higher level of RSPO Certification by 31 December 2018.

We also work with our suppliers and stakeholders to ensure the fair and ethical treatment of suppliers, to avoid deforestation, and to protect conservation values in the palm products supply chain.

Our commitment to eradicate unsustainable palm oil includes developing a Palm Products Standard that requires high standards of sustainability for any palm products in our supply chain. 

Roundtable on Sustainable Palm Oil (RSPO)

Find out more about the Roundtable on Sustainable Palm Oil.

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Fonterra Group Palm Products Standard

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What we stand for

1 Some palm derivatives for use in specialised products may require additional time to transition.

2 www.rspo.org/certification/supply-chains.

Our Palm Products Standard requires that all vendors of palm products within Fonterra’s supply chain are publicly committed to policies that give equivalent effect to “No Deforestation, No Peatland Development, and No Exploitation” and have business processes in place to enact these commitments.  For more information, see:

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Palm Oil

Fonterra supports the production of certified sustainable palm oil.

Palm oil is a vegetable oil widely used by food manufacturers globally across an extensive range of products. It is used in some products to enhance texture and to bond (emulsify) the ingredients or to provide supplementary fats.

 

As with all inputs into our supply chain, sustainability is a priority for us, and this includes being careful about where we source our ingredients. We support the production of certified sustainable palm oil through the Green Palm™ scheme. Green Palm™ is endorsed by the Roundtable Sustainable Palm Oil (RSPO) and Fonterra is an RSPO member.

 

In 2016 calendar year, Fonterra procured 15,134MT of palm oil ingredients, all of which were from RSPO-certified sources:

 

  • 2.7 percent was from segregated sources where it is kept separate from ordinary palm oil throughout the supply chain

  • 57.0 percent was from ‘mass balance’ sources which are mixed with ordinary palm oil throughout the supply chain

  • 40.3 percent was from ‘book and claim’ sources, where the supply chain is not monitored but credits are purchased from RSPO-certified growers

     

As part of the commitments outlined in the Fonterra Palm Products Standard, Fonterra will move towards sourcing segregated supply palm oil from credible organisations with an aim of 100 percent segregated supply by the end of 2018.

 

All Fonterra Brands New Zealand products fully comply with Australia, New Zealand and international food safety standards.

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PALM PRODUCTS

The Fonterra Palm Product Standard

In August 2016, we released the Fonterra Palm Product Standard which commits Fonterra to a higher standard of sustainability and more proactive and transparent monitoring of the palm products that we source globally. This standard was shaped in consultation with our stakeholders:

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The standard requires that:

 

  • Fonterra will move towards sourcing segregated supply palm oil from credible organisations with an aim of 100 percent segregated supply by 2018. 1
  • All vendors of palm products within Fonterra’s supply chain must publicly be committed to policies that give equivalent effect to “No Deforestation, No Peatland Development, and No Exploitation” and have business processes in place to enact these commitments.
  • Fonterra has traceability to mill, with time-bound plans to achieve traceability to plantation.
  • Fonterra will disclose use of palm products and performance of palm products suppliers in relation to this standard.

We have been working with The Forest Trust (TFT) to evaluate the performance of our palm products supply chain and compliance with our standard. Since the end of the financial year we have strengthened this relationship, by becoming a TFT member.

Working with our vendors, we have confirmed 96.7 percent traceability to mill, and 17.7 percent traceability to plantation for PKE purchased through INL for the year to June 2017.

In 2016 Fonterra procured 15,135 metric tonnes of palm oil ingredients, all of which were from RSPO-certified sources2:

  • 2.7 percent was from segregated sources, where it is kept separate from ordinary palm oil throughout the supply chain
  • 57.0 percent was from ‘mass balance’ sources which are mixed with ordinary palm oil throughout the supply chain
  • 40.3 percent was from ‘book and claim’ sources, where the supply chain is not monitored but credits are purchased from RSPO-certified growers.

In Australia, two of our sites also have independent supply chain certification (SSC RSPO), which allows any products we make there containing palm oil to be fully certified.