Fonterra's Palm Kernel Supply Tied to Illegal Deforestation in Indonesia, Says Greenpeace
Greenpeace Aotearoa has raised alarms over Fonterra’s entire supply chain, claiming it is tainted with illegal palm products. This revelation follows the identification of major importers of palm kernel into New Zealand being involved in illegal operations in Indonesian forest areas.
A critical decree from Indonesia’s Minister of Forestry has brought to light a list of 436 companies accused of operating palm plantations without appropriate permits. Prominent New Zealand importers, including Wilmar International and Viterra, have been implicated.
Sinéad Deighton-O’Flynn, a Greenpeace spokesperson, highlighted the extensive deforestation in Indonesia, driven by palm plantations, with nearly 10 million hectares of primary forest destroyed in the past 20 years. She blamed New Zealand’s dairy industry, spearheaded by Fonterra, for contributing to this environmental crisis through the reliance on palm kernel as cattle feed.
New Zealand stands as the world’s largest importer of palm kernel, bringing nearly 2 million tonnes annually from Southeast Asia for use during dry seasons when grass for dairy cattle is scarce. Key suppliers like Wilmar International sell palm kernel exclusively through Fonterra’s Farm Source, linking them directly to the environmental impact.
Amid these allegations, Fonterra faces criticism for tainting its dairy products with deforestation-linked palm kernel, thus affecting brands like Kit Kat and Snickers, which rely on Fonterra’s supply.
An analysis by Greenpeace Indonesia reveals the illegal palm plantings occupy significant habitats for critically endangered species like orangutans and Sumatran tigers. The Indonesian government’s decree highlights over 1 million hectares of forest used illegally for palm plantations, sparking global concern.
Despite Fonterra’s commitment to eliminating deforestation from its supply chains by 2025, findings suggest a complicit link among brands like Nestlé, MARS, and Danone in historical deforestation. Existing certifications such as the Roundtable on Sustainable Palm Oil (RSPO) have been criticized as ineffective.
The controversy has led Greenpeace to urge Fonterra to abandon rainforest-destroying palm kernel and to uphold its sustainability promises, amidst ongoing greenwashing allegations over its product labeling practices.
