KUALA LUMPUR (Commodity Online): In January, for the first time, sales of sustainable palm oil to processors and retailers matched production by certified suppliers, according to Roundtable on Sustainable Palm Oil (RSPO).

In January 2010, close to 120,000 tonnes of sustainable palm oil or matching certificates were traded by either UTZ Certified or GreenPalm. About the same volume of sustainable palm oil was produced that same month by RSPO-certified oil mills and their supply base, bringing the market uptake for January to a whopping 98 percent.

Much oil from 2009 is still readily available, though, and production is projected to increase. All current market figures are available through the RSPO's online Market Center.

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At this early stage, most of the palm oil is sold using the Book & Claim system, in which end-users such as product manufacturers and retailers buy online certificates that match palm oil batches produced by RSPO-certified plantations. Increasingly, however, sustainably produced palm oil itself, kept 'segregated' throughout the supply chain, is becoming available for purchase.

GreenPalm and UTZ reduce fees on sustainable palm oil
Late last year, purchasing sustainable palm oil became even more attractive thanks to GreenPalm and UTZ Certified lowering their transaction fees. Both traders now charge 2 US dollars per metric ton (MT) sustainable palm oil, whatever supply chain system is used (i.e. 'segregated', 'mass balance' or 'book and claim'). Contributions to the RSPO remain at 1 USD/MT, bringing total fees (transaction fee + contribution to RSPO) to 3 USD/MT.

Late last year, the RSPO pledged to use fees collected from certified palm oil trade for helping small plantation owners meet certification requirements such as local inspections by independent certifying agents. The policy will be part of the Taskforce on Smallholders' new work program, which is under development.

‘Market eager to begin trading sustainable palm oil’
Many palm oil traders are actively preparing to begin trading sustainable palm oil, according to Bas Geerts, head of business development of Amsterdam-based UTZ Certified, which traces sustainable palm oil up until final refinery.

“In recent months, we have seen many players start to trade volumes of sustainable palm oil to experience first-hand the ease of our traceability system,” says Geerts. “Many others are demonstrating their interest by requesting to participate in one of our web training sessions, which include a demonstration of the system.”

In the training, UTZ also presents the three simple steps needed to begin trading sustainable palm oil: (A) become an RSPO member, (B) submit a self-assessment to the RSPO and (C) begin trading. “By then, they are ready to go,” says Geerts

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