Fonterra faces PKE questions
Fonterra is facing fresh questions about whether it is contributing to deforestation in Indonesia.
Greenpeace has alleged that Fonterra’s supplier of palm kernel expeller (PKE), Singaporean food giant Wilmar International, was closely associated with a plantation firm called Gama that it has accused of engaging in large-scale deforestation in Western New Guinea in Indonesia.
The environmental group said Gama Group was run by senior Wilmar executives and family members and it had photographic evidence that the company had destroyed at least 21,500 hectares of forest in Indonesia – an area more than twice the size of Lake Wanaka, New Zealand’s fourth largest lake.
Greenpeace said Gama was set up by Wilmar co-founder Martua Sitorus and his brother Ganda in
2011. It alleged that Wilmar and Gama had for years ‘‘worked together, with Gama doing the dirty work so Wilmar’s hands appeared to stay clean’’.
Wilmar sold three plantations to Gama between 2004 and 2014 following accusations against those plantation of deforestation, social conflicts with villagers, and of receiving palm products from illegal plantations within a national park, it said.
New Zealand imported a nearrecord 2.1 million metric tons of PKE, with a retail value of about
$500 million, to use as an animal feed last year.
Wilmar – which also owns well-known Kiwi brands such as Chelsea and Vogels – has a joint venture with Fonterra called International Nutritionals, which is responsible for importing about 30 per cent of that total.
Wilmar appeared to acknowledge overnight on Monday that it may have sourced palm products from Gama, while also seeking to distance itself from the company.
Wilmar released a statement saying it had ceased sourcing palm products from ‘‘all suppliers that are allegedly associated with Gama Corp’’ last Wednesday.
The family ties were acknowledged by Wilmar in its statement, but it denied the thrust of Greenpeace’s accusation that it had conspired with Gama.
‘‘Wilmar and Gama Corp are two separate corporate groups, operating independently of each other. Wilmar has no control, management or otherwise, over Gama Corp. Wilmar executives with familial ties with Gama Corp do not hold any decision- making power or influence on Wilmar’s sustainability policy.’’
Fonterra spokesman Chris Mirams was unable to immediately confirm whether Fonterra’s joint venture with Wilmar had been supplied with PKE from Gama’s plantations.
Fonterra required all its vendors of palm products to avoid deforestation, peatland destruction and exploitation, he said.
‘‘As a matter of process, we will check with Wilmar that the information they have provided us previously is up to date and accurate.’’
In April, Fonterra acknowledged it was concerned by allegations from human rights groups that paramilitary police routinely hosted by Wilmar on its palm plantations had been engaged in acts of brutality, including the shooting of two people with rubber bullets in December.
Wilmar said the pair were shot by members of Indonesia’s Brimob police brigade to defend a security guards during a violent confrontation over palm fruit theft from one of its plantations.
Greenpeace spokeswoman Gen Toop said its latest investigation meant Fonterra would take another hit to its international reputation.
She called on the dairy cooperative to stop using PKE and to ‘‘refocus onto pasture-based dairying and farm fewer cows’’.
Lewis Road Creamery chief executive Peter Cullinane has called for a ban on PKE imports.
But Agriculture Minister Damien O’Connor suggested in April that the farming industry might turn away from using PKE without state intervention.
O’Connor also indicated he had not yet made up his mind whether the mandatory labelling of palm oil in food for human consumption was warranted.
The Ministry for Primary Industries is considering whether there should be mandatory labelling of palm oil, which is an ingredient in a variety of foods, to help consumers avoid the ingredient if they chose.
However, there are no clear signs of progress since a technical evaluation report was published in May last year.