Only seven of the top ten suppliers of Indonesian palm oil for China had committed themselves to a no-deforestation, no-peat, no-exploitation (NDPE) policy as of January 2021, according to a report from sustainability think tank Chain Reaction Research.
The report found that refiners without an NDPE policy or those not having implemented such principles accounted for at least 12 percent of Indonesian palm oil shipped to China.
The Jakarta Post
Consumer demand for sustainably-sourced products is seen as fundamental to the adoption of environmental practices in the palm oil sector, but market leakage is limiting the pressure on firms to adapt.
Indonesia and other countries are perceived as leakage markets and thus are capping the pressure to create sustainable palm oil products, an environmental expert has said. Bukti Bagja, senior manager for smallholders and livelihood transformation at World Resources Institute (WRI) Indonesia, said pushing for sustainable practices in the palm oil sector was challenging, because demand for sustainable palm oil products was very limited in both the domestic and international market.