JAKARTA May 5 The Indonesian unit of Unilever
(ULVR.L) (UNc.AS), the world's top palm oil buyer, on Wednesday
said it gets 65 percent of its palm oil from Indonesia despite
halting purchases from a unit of market leader Sinar Mas Group.
Unilever, which uses palm oil in such products as Dove soap
and Ben & Jerry ice cream, cancelled its annual 20 million
pound ($30.27 million) contract with one of its Indonesian
suppliers, PT SMART (SMAR.JK) in December. SMART is part of
Sinar Mas Group, Indonesia's biggest palm oil producer.
The move prompted speculation that Unilever might cut palm
oil purchases from other Indonesian suppliers, but a
spokeswoman for the company said it was still buying from
"About 65 percent of palm oil bought by Unilever worldwide
comes from Indonesia. We only stopped buying from SMART but we
are still buying from other Indonesian suppliers," said Maria
Dewantini Dwianto, a spokeswoman for PT Unilever Indonesia
SMART had shipped some palm oil cargoes up to April to
fulfil an agreement made ahead of Unilever's decision to stop
purchasing from SMART, Dwianto added.
Other palm oil suppliers in Indonesia include Musim Mas and
an Indonesia unit of Singapore-listed Wilmar (WLIL.SI), she
Unilever consumes about 1.9 million tonnes of palm oil each
year -- of which about four-fifths comes from Indonesia and
Malaysia -- and has pledged to buy only from certified
sustainable plantations from 2015.
Greenpeace has alleged that Sinar Mas, Indonesia's biggest
palm oil producer and the second-biggest in the world, has been
responsible for widespread deforestation and peatland
clearance, practices which release vast amounts of carbon
PT SMART and PT Unilever Indonesia agreed to appoint two
independent auditors -- Netherlands-based Control Union
Certification (CUC) and British Standard institute -- last
month to investigate the environmental allegations.
SMART's president director, Daud Dharsono, has said that
the independent auditors would complete their study by the end
The allegations by Greenpeace prompted Nestle NESN.VX to
stop buying palm oil from Sinar Mas, while agribusiness giant
Cargill Inc [CARG.UL] has also threatened to remove Sinar Mas
as a palm oil supplier.
(Reporting by Telly Nathalia; Editing by Yoko Nishikawa and