Thu, 22 Sep 2011

Unilever Indonesia, the country’s largest listed consumer goods maker, may resume purchasing crude palm oil from Sinar Mas Agro Resources and Technology following an 18-month halt after the palm oil producer made improvements to abide by Unilever’s guidelines for responsible environmental practices.

Sancoyo Antarikso, corporate secretary of Unilever Indonesia, said Wednesday that Unilever would consider the commercial purchase of palm oil from Sinar Mas Agro Resources and Technology, should the company known as Smart follow through on raising its environmental standards.

According to Sancoyo, Smart would also conform to guidelines set by the Roundtable on Sustainable Palm Oil, a non-governmental organization made up of planters, green groups and consumers. RSPO sets green standards for the palm oil industry, but does not impose sanctions on members who violate its voluntary standards.

Officials at Smart were not available to comment.

“We really appreciate the commitment of Smart to RSPO and feel convinced with Smart’s move to obtain certification,’’ Sancoyo wrote in an email.

Unilever’s move would follow in the steps of Nestle. Last week, the Swiss food giant said it would resume purchases of palm oil from Smart, which now meet Nestle’s environmental guidelines.

The two multinationals dropped Smart as a supplier in March last year, as it failed to abide by global standards on environmental practices. The two companies reinforced their commitment to sustainable rainforests by stating in July last year that they were committed to stop using products that contributed to the destruction of rainforests.

Sancoyo said Unilever has not made any purchase yet from Smart, but has held discussions and will “monitor the progress made by Smart.”

Bustar Maitar, the head of Greenpeace Indonesia’s forests campaign, said companies like Unilever and Nestle are watching whether Smart is truly improving its practices.

“Smart’s buyers are watching if the company is committed to improving its environmental practices. Greenpeace will give the chance for Smart to prove its commitment,’’ Bustar said.

Greenpeace last year accused Smart of clearing peatland and forests that sheltered endangered species. Smart runs the Indonesian palm oil operations of its Singapore-listed parent, Golden Agri-Resources.

Burger King and Kraft Foods also stopped purchasing palm oil in March 2010.

Shares of Smart remained unchanged at Rp 6,650 on the Indonesia Stock Exchange. Smart shares have risen 33 percent this year.