Cargill, one of the world’s largest agricultural trading companies, has set a deadline of 15 July 2016 for Malaysian palm oil group IOI to come up with a responsible sourcing policy. IOI is at the centre of a row over sustainability practices following its suspension from the Roundtable on Sustainable Palm Oil (RSPO) for breaking rules designed to curb deforestation and land rights abuses.
Cargill’s move, reported in the Financial Times, seems to mark a change of tactics. The FT had previously reported that Cargill and Bunge, another farm products trading giant, were refusing to cut business ties with IOI, as other powerful palm oil consumers had, saying they preferred to work towards improving suppliers’ practices while remaining IOI’s trading partners.
Big consumer brands, including Unilever, Nestlé, Mars and Kellogg, along with the commodity traders Archer Daniels Midland and Louis Dreyfus, had said they would stop buying palm oil from IOI following its suspension from the RSPO (FW216).