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With SMART SEED, Sinar Mas Agribusiness and Food Supports Supply Chain Transformation to Drive Progress on Sustainable Palm Oil

Posted: Nov 02, 2023 4 minute read SMART 321 views

Bali, November 2, 2023 – Palm oil producers, buyers, civil society organisations and government recently stepped up collaboration on sustainable supply chains at the SMART SEED (Social and Environmental Excellence Development) event organised by Sinar Mas Agribusiness and Food. Held at the Four Points Hotel in Bali on Tuesday 31 October, the ninth edition of this event focused on “Supply Chain Transformation in Support of Sustainable Palm Oil”.

Palm oil, like many other commodities, faces increasing demands from international customers and regulators to demonstrate progress on a number of sustainability indicators. Globally, Environmental, Social and Governance (ESG) regulations have increased by 155 per cent in the past decade. The European Union Deforestation Regulation (EUDR), which will prevent commodities linked to deforestation from entering the bloc, will be implemented at the end of 2024, while other guidance on climate disclosures and sustainability reporting will only increase compliance requirements.

Through SMART SEED, Sinar Mas Agribusiness and Food is supporting suppliers to address these challenges with a programme of education and capacity-building sessions led by industry experts including the Council of Palm Oil Producing Countries (CPOPC), Verité, World Resources Institute (WRI) Indonesia, Earthworm Foundation (EF), and representatives from GAR.

Collaboration key to accelerate transformation

Speaking at the event, Yong Khing Siong, Head of Traceability and Responsible Sourcing at Sinar Mas Agribusiness and Food, said that the goal was to help suppliers understand the latest changes in global market requirements and recognise the importance of advancing sustainability standards and practices across the supply chain.

“Sinar Mas Agribusiness and Food is committed to helping our suppliers stay ahead of global market demands through sharing best practices and offering technical support. With evolving requirements to deliver on sustainability markers including no deforestation commitments, carbon emissions and employment practices, we want to ensure that each stakeholder in the supply chain plays their role to contribute to transformation,” said Yong.

Supporting suppliers to meet national targets

The first of the event’s two panel discussions discussed the multi-stakeholder efforts needed to meet market requirements for sustainable transformation. In the panel, Prayudi Syamsuri, Director of Processing and Marketing of Plantation Products (PPH Bun), Directorate General of Plantations, at Indonesia’s Ministry of Agriculture, conveyed the government’s policy on implementing the EUDR, encouraging greater uptake of Indonesian Sustainable Palm Oil (ISPO) certification, and the need to build a clearing house as the single-portal for exporters of refined palm oil to access government verified traceability and legality data for crude palm oil.

“We are facing serious challenges in the palm oil industry due to issues of sustainability and deforestation. Therefore, we have prepared several strategies to overcome accusations that Indonesian palm oil is unsustainable by encouraging the implementation of ISPO with a completion target of 2025 as well as a palm oil clearing house which aims to resolve various problems related to palm oil by involving various stakeholders to provide comprehensive solutions,” said Prayudi during the panel discussion.

Showcasing technical support

A second session examined the technical support Sinar Mas Agribusiness and Food and its partners have undertaken to enhance supply chain transformation through efforts such as the Sawit Terampil program.

The company joined speakers from Verité Southeast Asia and independent smallholder participants from the Sawit Terampil program to discuss the support available for farmers to improve sustainable practices. The company shared its commitment to support emerging sustainability requirements, including plans to help suppliers meet Scope 3 Greenhouse Gas reporting requirements. Sinar Mas Agribusiness and Food also invited suppliers to participate in collaboration programs with Verité to improve the implementation of labour and human rights aspects in the supply chain.

The SMART SEED event concluded with a breakout session giving participants an opportunity to explore the obstacles that need to be addressed in this transformation effort.

“Meeting global requirements is not easy. Staying up to date with the details of regulatory updates, and putting these requirements into practice can be dependent on educational capabilities and organisational efficiency, as well as environmental factors. At the SMART SEED event, we were given space to discuss these obstacles through sharing sessions and workshops regarding programs,” said Dimas Bramandita, a Sinar Mas Agribusiness and Food supplier from PT Seuramoe Agro Persada, palm oil plantation management company from Aceh Province.

[ENDS]

About Sinar Mas Agribusiness and Food

Sinar Mas Agribusiness and Food, which operates under Golden Agri-Resources (GAR), is one of the leading oil palm plantation companies with a total planted area in Indonesia reaching more than 537,733 hectares (including plantations owned by plasma farmers) as of 30 June 2023. The company has an integrated operation that produces food ingredients made from vegetable oils.

Its parent company, GAR was founded in 1996 and listed on the Singapore Stock Exchange in 1999 with a market capitalization of US$2.3 billion as of 30 June 2023. Flambo International Limited, an investment company, is currently GAR’s largest shareholder, with ownership shares amounting to 50.56 percent. GAR has several subsidiaries, including PT SMART Tbk which was listed on the Indonesia Stock Exchange in 1992.

Sinar Mas Agribusiness and Food focuses on sustainable palm oil production. In Indonesia, the company’s main activities include cultivating and harvesting oil palm trees; processing fresh fruit bunches into crude palm oil (CPO) and palm kernel; trading and refining CPO into value-added products such as cooking oil, margarine, shortening and biodiesel; as well as trade in palm oil products throughout the world. The company also has operations in China and India, including deep sea ports, oilseed processing plants, production capabilities for refined vegetable oil products, as well as other food products such as noodles.

For more information about the company, please visit https://www.smart-tbk.com

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