Cargill: Severe deforestation, labour rights violations at Indonesian palm oil suppliers

Five of the world´s largest palm oil companies , together with Cargill, set up the voluntary Sustainable Palm Oil Manifesto (SPOM) in July 2014 with the aim to “ensuring sustainability in the entire chain from cultivation to consumption” of palm oil1. The members claim to enhance the RPOS criteria. However, Greenpeace, Rainforest Network and others2 heavily criticized the new document. Within the SPOM framework, one year- studies are foreseen to determine which areas have to be protected as High Carbon Stocks. Critics fear that in this time the deforestation will proceed rapidly3 (in one year, 2012, the deforestation in Indonesia amounted to 840,000 hectares)4, and point out that the SPOM is not binding and does not even cover all operations, subsidiaries and third suppliers. Plans for implementation, monitoring or grievance are lacking5.

This sheds light on one of Cargill´s palm oil supplier, Kuala Lumpur Kepong (KLK) from Malaysia, with shippings worth more than 61 million pounds (appr. 70 million Euro at time of writing) in three years6. According to KLK´s annual report, the company has plantation operations on 137,483 hectares in Indonesia7, while their oil palm plantations have increased by 41,734 to more than 196,000 hectares since 2009 to 2013 only8.

KLK is accused of wide deforestation, forced and child labour and the disregard of communities´ right to free prior and informed consent on their oil palm plantations9. However, Cargill did not see violations of any labour law at KLK operations10.

One of KLK´s subsidiary was also found guilty for causing widespread forest fires in Indonesia in summer 2013 and fined RP 15 billion (almost 1 million Euro) for the environmental damage it caused11.

  1. Sustainable Palm Oil Manifesto (accessed 24.09.2014) []
  2. Forum Nachhaltiges Palmöl (2014): Sustainable Palmoil Manifesto (SPOM); 15 July (accessed 24.09.2014) []
  3. Greenpeace International (2014): Greenwash alert as palm oil companies sign onto continued deforestation; 11 July (accessed 24.09.2014) []
  4. Butler, R.A. (2014): Despite moratorium, Indonesia now has world´s highest deforestation rate; Mongabay, 29 June; Margono, B.A. (2013): Primary forest cover loss in Indonesia over 2000-2012; Nature, 23 December (accessed 24.09.2014) []
  5. Sutherlin, L. (2014): New Palm Oil “Talk and Log” Initiative a Step Backward for Responsible Supply Chains; Rainforest Action Network, 11 July (accessed 24.09.2014) []
  6.  Skinner, E.B. (2013): Indonesia´s Palm Oil Industry Rife With Human-Rights Abuses; Bloomberg Businessweek, 18 July (accessed 24.09.2014) []
  7. Kuala Lumpur Kepong Berhad (2013): Annual Report 2013, p. 145 (accessed 24.09.2014) []
  8.  Kuala Lumpur Kepong Berhad (2013): 5-year plantation statistics (accessed 24.09.2014) []
  9. Conroy, J. (2014): Report: Child Labor, Land Grabbing and Deforestation Rampant Across Palm Oil Giant KLK´s Operations; Rainforest Action Network, 2 April; Rainforest Action Network (2013): Growing Evidence Reveals Child Labor in Cargill´s Palm Oil Supply Chain; 3 August (accessed 24.09.2014) []
  10. Skinner, E.B. (2013): Indonesia´s Palm Oil Industry Rife With Human-Rights Abuses; Bloomberg Businessweek, 18 July (accessed 24.09.2014) []
  11. Widhiarto, H. (2014): Malaysian firm fined, executives get prison for role in forest fires; Jakarta Post, 11 September (accessed 24.09.2014) []

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