MDLZ Mondelez International Inc

By Micah Maidenberg

Mondelez International Inc. said it has tightened sourcing practices around palm oil, the ingredient used in various foods that has been linked for years to deforestation of tropical forests.

The maker of Oreo cookies, Triscuit crackers and other snacks on Thursday said its suppliers of palm oil must demonstrate they can trace materials back to palm farms and have in place satellite monitoring covering palm concessions that feed mills that produce oil for the company.

Suppliers must also identify all mills on Global Forest Watch, a platform created to monitor forests around the world, and take more action to stop worker exploitation within supply chains, Mondelez said.

Consumer-product companies have faced pressure from environmentalists, advocates for indigenous people and shoppers to do more to ethically source ingredients. Large farms that produce palm fruit, from which palm oil, is derived, have displaced critical habit and forests, advocates says.

Some 60% of consumers in the U.S., China and three large European countries said they place a major emphasis on ingredient sources when buying healthier food, according to a 2018 survey by AlixPartners.

Unilever PLC, Nestle SA, General Mills Inc. and other food producers have various efforts underway to try to improve the palm-oil supply chain.

The company expects 80% of its palm oil to meet the new requirements by the first quarter next year.

Mondelez represents about 0.5% of demand for palm oil, it added.

"We are continuing to pioneer partnership and action with our suppliers to ensure they share and actively support not only our commitment, but the larger collective commitment, to realize a forest positive future," said Quentin Roach, Mondelez's top procurement executive.

Write to Micah Maidenberg at micah.maidenberg@wsj.com

(END) Dow Jones Newswires

September 03, 2020 17:04 ET (21:04 GMT)

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