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NEWS UPDATES 13 December 2009

Unilever cuts ties with Indonesian palm oil supplier

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Anglo-Dutch food and cosmetics giant Unilever said Friday it was severing ties with an Indonesian palm oil supplier accused by environmental organisation Greenpeace of destroying rainforests, AFP reported.

"The Greenpeace claims are of a nature that we cant ignore. Unilever is committed to sustainable sourcing. Therefore, we have notified PT Smart (part of the Sinar Mas group) that we have no choice but to suspend our future purchasing of palm oil," said Marc Engel, Unilver's chief procurement officer, in a statement.

Unilever said allegations due to be published by Greenpeace this week criticised Sinar Mass environmental practices.

"As a result Unilever has decided to take immediate action," it added. Unilever would only reconsider its decision if PT Smart could "provide verifiable proof that none of their plantations are contributing to the destruction of high conservation value forests and expanding onto peat lands," Unilever said.

PT Smart supplies Unilever with five percent of its palm oil requirements. It uses palm oil in the manufacture of margarine, soups, ice-cream and sauces as well as in beauty products. Indonesian officials have said they aim to more than double the country's crude palm oil output to 40 million tonnes by 2020 through increased yields and more plantations.

The plans have been opposed by environmental groups, who say Indonesia's forests are vital carbon sinks in the fight against climate change and an irreplaceable source of biodiversity.


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