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Neste sets ambitious PFAD traceability target - 100 percent traceable in 2020

As the first company in the world, Neste has set ambitious public targets to develop traceability of Palm Fatty Acid Distillate (PFAD) it uses as one of its renewable raw materials. It also invites food industry actors to "join forces" in overcoming complexities.

Finland-headed renewable fuels and oil refiner Neste has set ambitious public targets to develop traceability of the palm oil based processing residue Palm Fatty Acid Distillate (PFAD) it uses as one of its renewable raw materials. In a statement, the company has announced that its goals for PFAD traceability are:

  • In 2017, all PFAD that Neste uses will be 100 percent traceable to palm oil mills
  • In 2020, all PFAD that Neste uses will be 100 percent traceable to palm oil plantations

Earlier this month, it published its renewed CPO Dashboard offering even more comprehensive information about the company’s crude palm oil (CPO) supply chain, such as certifications and maps of mill locations. Now the company aims at becoming the first in the world to achieve a similar level of transparency and traceability with the PFAD the company uses as raw material.

According to Neste, all the CPO it uses has been fully traceable to the plantation level since 2007, and 100 percent certified since 2013. Neste was the first of the larger palm oil using companies to make its palm oil supply chain fully transparent in 2016.

Third-party residues illustrates challenge with EU policies

To achieve these targets, Neste engages in close cooperation with PFAD suppliers, environmental organizations, and other experts in Southeast Asia, such as Consortium of Resource Experts (CORE), an organization combining experts from Daemeter, Proforest, and the Rainforest Alliance.

The task at hand is, however, significantly more complicated because palm oil production process yields only 4-5 percnt PFAD as a processing residue, and the larger volumes need to be gathered from a large number of sources. However, what makes the task even more challenging is that the industries such as food and chemical industries using the vast majority of palm oil globally are not required by law to know precise origins of their raw materials.

This is where these industries differ from the biofuels industry which within EU, among many other markets, is required to know the exact origin of its raw materials. In the case of waste and residues, this requirement applies to the place where each residue or waste is generated.

Invitation to food industry

– In order to trace back PFAD, we need to develop full traceability for the primary product, the palm oil refined for food industry uses. The PFAD in one cargo ship may have been collected from 100 to 300 mills, handling fruit from 600 to 1 000 oil palm plantations. In order to overcome such complexity, we are inviting ambitious and forward-looking food industry actors to join forces with us, and to have a big positive impact on overall sustainability in the palm oil sector, explained Johan Lunabba, Sustainability Director at Neste.

Crude Palm Oil (CPO) and Palm Fatty Acid Distillate (PFAD) are two of many different raw materials used by Neste for its renewable products.

Crude Palm Oil (CPO) and Palm Fatty Acid Distillate (PFAD) are two of many different raw materials used by Neste for its renewable products.

PFAD is one of over 10 different renewable raw materials that Neste uses for refining its renewable products. Waste and residues currently account for nearly 80 percent of the company’s renewable raw material usage. According to Neste, all of the raw materials it uses meet the sustainability and traceability requirements set by international and local regulations.

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