Last year Rotterdam-headquartered Natural Habitats produced around 12,000 metric tons of organic crude palm oil, or around one-quarter of the 50,000mt global total, and over the next year, it hopes to almost double that.
“Our objective is to go beyond the 20,000mt mark in 2020,” Monique van Wijnbergen, sustainability and corporate communications director at Natural Habitats, told FoodNavigator-LATAM.
In addition to being organic, its palm oil is also certified by Fair for Life (fair trade), Rainforest Alliance and the Roundtable on Sustainable Palm Oil (RSPO) for producing Identity Preserved (IP) palm oil.
According to van Wijnbergen, the reason Natural Habitats chose to locate its operations in Latin America stemmed from “a very personal story”: its founder, Alfons van der Aa, married an Ecuadorian and has always felt a strong link to the country. However, it also made sense from a logistical, commercial and sustainable perspective, she added.
“Ecuador is a good source for palm oil. We bought our own mill but since scaling up we work with other mills too, and they are very reliable processing partners. The farmers in our network are committed to palm oil growing and the broader landscape commitments and, from a logistics point of view, Ecuador works very well, especially when compared to Sierra Leone."
[Natural Habitats also sources from Sierra Leone since 2014, and although it now runs the largest organic palm oil operation in Africa, 99% of its total palm oil still comes from Ecuador, it says].
“Latin America as a palm-producing frontier is growing and is doing so from a very different growth mindset than the Southeast Asian palm oil origins," van Wijnbergen said. "The two largest palm-growing countries, Colombia and Ecuador, are taking sustainability and halting deforestation seriously.
“At the same time, several studies have shown that the majority of land that has been turned over to palm oil growing in Ecuador, was already cleared for other purposes like cattle ranching, which means that palm growing replaces pastures instead of forests," she added.
Changing the conversation
Through its public-facing awareness movement 'Palm Done Right', Natural Habitats hopes to convince the public that palm oil can "fit conscious consumption".
“Palm oil is in the limelight a lot but unfortunately in a negative way,” said van Wijnbergen. “Palm Done Right is a movement we started to change the conversation around palm oil and show it can be produced sustainably.”
While acknowledging that the link between palm oil production and deforestation, notably in Indonesia and Malaysia is real, Natural Habitats argues that boycotting palm oil is “short-sighted”.
“Boycotting palm oil will only shift deforestation and biodiversity loss to other parts of the world for the sourcing of other, less productive, vegetable oils,” it says.
Oil palm trees produce somewhere between six and 10 times greater oil yields than other oilseed crops such as rapeseed, soybean, olive and sunflower, meaning less land is needed to produce the same amount of oil.
The palm trees also produce fresh fruit bunches all year round, providing a steady annual income for farmers.
None of this organic supply, however, is destined for the Latin American market.
“We source and produce for customers who specifically want to buy organic, fairtrade palm oil and at the minute we don’t see a lot of local demand for that. If you produce in a certain way, it is more expensive,” van Wijnbergen explained.
“I can’t say that Latin America is too price sensitive – all markets are generally – but fortunately there are companies and manufacturers that are very keen on sustainable practices. Those are the leaders who want to make sure everything they source is sustainable.”
Natural Habitats’ biggest customers are German baby food producer HiPP, organic German brand Rapunzel and US personal care brand Dr Bronner.
Van Wijnbergen admits that organic palm oil is “still a niche product, both on a global and South American scale”, however, demand in Europe and US is growing.
“We are still able to produce enough to meet demand at this moment but are very busy locally to scale up the farmers to keep up,” she said. “Lots of farmers in Ecuador are conventional so we need to convince them to produce organic.”
Palm oil produced for Natural Habitats uses natural pest management, multi-cropping and composting. Only existing cropland or degraded land is used for plantations.
Fruit is handpicked and farmers favor animal transportation where possible to cut down on fossil fuels.
Farmers are also encouraged to diversify with complementary crops, such as cacao, supplementing income and avoiding monoculture.
On Natural Habitat plantations, 80% of the land is used for cultivation, 5% for infrastructure and 15% is left as a protected biodiverse environment.
It also develops community programs that focus on local infrastructure, education, and nutrition.
Paying a premium price
Due to the fluctuating market prices, van Wijnbergen was unable to indicate the price differential between its certified palm oil and conventional supplies but, as it takes into account the premium farmers receive for the combined organic, fair trade, RSPO certifications, said it was “quite big”.
Natural Habitats counts 180 independent family farmers in its Ecuadorian supply network who, between them, own 20,000 hectares of land. Half of this surface area is used to cultivate oil palms (both organic and conventional) and the remaining half is used for other crops, housing and plots set aside for biodiversity and conservation.
The company has a team of trained agronomists on-hand to accompany farmers in making the transition, training them on the requirements for each of the standards, helping them complete the paperwork, and ensure compliance.
At a glance
Producing 1.6 million tonnes annually, Colombia is Latin America’s biggest palm producing country and contributes 2% to global supplies.
Colombia is on a drive to increase its palm production and says it can do so on land that has already been degraded for agriculture, such as pastureland. In 2017, 14% of Colombian crude palm oil (CPO) was certified by the Roundtable on Sustainable Palm Oil (RSPO), up from 2% in 2013.
Guatemala was the region's biggest exporter of palm oil in 2017, followed by Colombia and then Honduras, according to Oil World.
In 2018, Ecuador became the first country in the region to adopt a jurisdictional approach to sustainable palm oil certification, aiming to make the entire country’s palm oil supply chain RSPO-certified.