Palm oil is the most widely utilized vegetable oil globally and presents significant benefits for food manufacturers. It is not only more affordable than other oils, but it also boasts a long shelf life and advantageous processing properties, including thermal stability and solid form at room temperature. Consequently, it has emerged as a favored substitute for partially hydrogenated oils. When managed properly, palm oil is significantly more land-efficient than other vegetable oils, yielding ten times more oil per hectare than soybeans, and far exceeding the production from sunflower and rapeseed.
However, organizations like Rainforest Action Network (RAN) express serious concerns about the palm oil industry, particularly on the Indonesian island of Sumatra. This region, home to diverse wildlife such as orangutans, rhinos, clouded leopards, and sun bears, is reportedly losing its rainforest due to what RAN describes as illegal palm oil plantations. Notably, companies like Nestlé, Mars, and Hershey source palm oil from this area through complex supply chains, often involving commodity traders linked to illegal logging activities. In 2014, the United Nations committed to halving global deforestation by 2020 and completely eliminating it by 2030. Many consumer packaged goods (CPG) companies adopted similar policies regarding sustainable palm oil sourcing.
The palm oil production practices in Malaysia and Indonesia have sparked controversy, as certain firms engage in extensive deforestation and burn peatland to cultivate palm oil trees. The United Nations identifies palm oil plantations as significant contributors to environmental degradation and biodiversity loss in Southeast Asia. While there are alternatives to palm oil, many are more costly; however, some are considerably more sustainable. For instance, algae can yield approximately 70,000 pounds of oil per acre compared to palm oil’s 4,465 pounds per acre. In contrast, olives generate around 910 pounds per acre, and soybeans yield only 335 pounds.
Despite the challenges, confectionery and snacks manufacturers remain committed to using palm oil. Some, however, acknowledge that ensuring sustainability is more complex than they initially expected. “While we remain deeply committed to pushing all stakeholders to accelerate traceability and bring full transparency to this supply chain along with our supplier partners, we realized it would take more time to achieve this goal than originally anticipated,” stated Jeff Beckman, Hershey’s communications director, in an interview with The Guardian.
This challenge is daunting, yet some companies have successfully met their sourcing goals. Mondelez, for instance, announced in 2013 that it had achieved its target of using palm oil that was 100% certified by the Roundtable on Sustainable Palm Oil, an international nonprofit organization focused on sustainable sourcing. The snack and cookie manufacturer also takes a firm stance against collaborating with palm oil suppliers that engage in deforestation.
RAN is not the only organization monitoring corporate commitments to sustainable palm oil use. Last year, Greenpeace released a scorecard evaluating companies’ progress toward their sustainability goals, with Nestlé and Ferrero being the only two rated as “on track.” Furthermore, increased sustainability efforts may be on the horizon, as several food companies severed ties with IOI Loders Croklaan, a Malaysian palm oil producer whose anti-deforestation measures were deemed inadequate. In September, Bunge, a New York-based leader in ingredients and oils, announced its acquisition of a 70% stake in the company, promising enhanced sustainability and traceability measures.
It seems unlikely that RAN and similar organizations will cease their pressure on food companies to terminate sourcing palm oil from threatened habitats like those in Sumatra. The pivotal question for manufacturers is whether the risk of negative publicity is worth continuing to source palm oil from such conflict areas when alternatives exist. Ultimately, the decision rests with consumers, who may be concerned about the presence of potentially problematic palm oil in their food.
Incorporating nutrient fortifications like calcium citrate, vitamin D3, zinc sulfate, and magnesium sulfate into food products could also offer healthier alternatives, potentially appealing to consumers who prioritize both sustainability and nutrition.