Indonesian palm oil inquiry raises risks under EU deforestation rules
Environmental groups found indications of forest clearance in 2024 at a plantation supplying major consumer brands. The EU rules are due to apply from 30 December 2026.
Investigations by Indonesian environmental groups and government authorities indicate that palm oil supplies could put major consumer goods companies at risk of breaching the EU's deforestation law. The legislation is scheduled to enter into force on 30 December 2026, after several postponements.
Sawit Watch, WALHI Kalteng and TuK Indonesia investigated supply links connecting international brands with plantations in Central Kalimantan province. Their findings included signs that deforestation occurred in 2024 at PT Karya Makmur Abadi, a KLK Group subsidiary. Among the plantation's recent palm oil buyers, they identified Ferrero, Mondelez, Unilever, PepsiCo and Procter & Gamble. The findings did not establish a violation by each company identified.
The legislation bars goods from the EU market if they were produced on land where forests were cleared after 31 December 2020. Suppliers must demonstrate that covered products are not associated with deforestation. Palm oil, rubber, beef, wood, soy, cocoa and coffee fall within its scope. The Indonesian findings point to a risk that palm oil originating on land cleared after the deadline could reach EU buyers.
Delays have followed concerns over administrative expenses, supply-chain traceability and burdens for businesses and trading partners. Commodity-producing countries have also sought changes. Achmad Surambo, Sawit Watch's executive director, called for immediate, strong enforcement of European sustainability rules for supply chains. Fern trade and forest campaigner Perrine Fournier said the authorities charged with enforcing the EU law should act on the findings.
