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Supply Chain

From Spreads To Shampoo, Palm Oil Is Part Of Everyday Life

Indonesia's plan to ban palm oil exports will deal a blow to the world's top food and consumer products companies including Unilever, Procter & Gamble and Nestlé

Indonesia counts for more than half of the global supply of the edible oil, which is used in everything from cakes, chocolate, margarine and frying fats to cosmetics, soap, shampoo and cleaning products.

It is also key to Ferrero Rocher chocolates and Nutella spread, giving them a smooth texture and longer shelf life.

Here is a summary of how much palm oil companies use, based on the most up-to-date data available:

Unilever

Unilever said in 2016 that it used about 1 million tonnes of crude palm oil and its derivatives and about 0.5 million tonnes of crude palm kernel oil and its derivatives.

It said it was the largest user of physically certified palm oil in the consumer goods industry.

The company declined to give more up-to-date data.

Nestlé

In 2020, the maker of KitKat chocolate bars bought about 453,000 tonnes of palm oil and palm kernel oil, mostly from Indonesia and Malaysia, its website says.

It uses about 88 suppliers from more than 1,600 mills in 21 countries. It also buys from Latin America, Africa, and other parts of Asia.

Procter & Gamble 

The company used about 605,000 tonnes of palm oil and palm kernel oil, and their derivatives, in its 2020-2021 fiscal year, a company document showed. It is used in its fabric and home care categories and beauty products.

Its purchases account for about 0.8% of global palm oil production and it sells palm oil byproduct it cannot use. Some 70% of its palm oil is sourced from refineries in Malaysia and Indonesia.

Mondelēz International

The Oreo cookie maker said that it purchases 'large quantities' of palm oil in a securities filing.

It accounts for 0.5% of palm oil consumption globally, according to its website.

Danone 

Danone said it purchased a total of 71,000 tonnes of palm oil in 2018.

Ferrero

The Italian maker of Nutella sourced 85% of its palm oil supplies from Malaysia and only 9% from Indonesia in the first half of 2021, according to its website.

L'Oréal 

L'Oréal said in 2021 that it purchased less than 310 tonnes of palm oil and also used, from its suppliers, ingredients including palm derivatives in a quantity equivalent of 71,000 tonnes.

News by Reuters, edited by Donna Ahern, Checkout. For more supply chain stories, click here. Click subscribe to sign up for the Checkout print edition.

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