The significance of palm oil
Palm oil is an important crop. It is used in many products – both food and non-food – from margarine, soups, and ice cream to shampoo, skin lotions, soap and candles. Around 50 million tonnes of palm oil are produced annually, on a planted area of about 12 million hectares.
Oil palms grow in equatorial conditions in Asia, Latin America and Africa, but more than 80% of the world’s supply comes from Malaysia and Indonesia. Since the 1990s the area of land used for palm oil cultivation has increased by about 43%.
The ever-growing demand for the oil is due to several factors, but the main reasons are:
growing populations that need to be fed
rising incomes in developing markets increase the desire to buy branded products
its use in biofuel production.
How do we use palm oil?
Unilever has a long history of using palm oil in its products. It is a versatile fat that can withstand refining at high temperatures, allowing individual components to be isolated for use in specific product applications.
Unilever purchases around 1.3 million tonnes of palm oil annually (mostly directly but with a small proportion through oleochemicals suppliers), which is around 3% of the world’s total production. However, over the past five years the total amount of palm oil (and speciality ingredients containing it) bought by us has decreased.
Palm oil ingredients are used across our portfolio, mainly in spreads, but also in savoury products (soups, sauces and bouillons) and ice cream. The oil is used in soap bars, while derivatives are also key ingredients in laundry and personal care products.
A long-standing commitment
Our commitment to sustainable palm oil is not new. In the mid-1990s, as part of our Sustainable Agriculture Programme, we started developing Good Agricultural Practice Guidelines for oil palm. We also began working with our own plantations and growers to implement these guidelines.
While better managed plantations and oil palm smallholdings serve as models of sustainable agriculture, there is serious concern that not all palm oil is being produced sustainably at present.
In 2004 we became a founding member of the Roundtable on Sustainable Palm Oil (RSPO) – an industry-led initiative set up in co-operation with the conservation organisation WWF. The aim of the Roundtable was to move towards an industry-wide approach to sustainability in palm oil cultivation.