Palm oil company execs discuss supply chain sustainability for cosmetic & PBC products

According to a recent report published by market research firm Statista​, 45% of US consumer survey respondents affirmed that one of the most important criteria for sustainable beauty products was the use of 100% natural ingredients.

Further, 39% of respondents stated that one of the most important factors in sustainable beauty product consumption is that products do not use ingredients that are harmful to the environment, and 31% stated that sustainable products need to be manufactured in a way that does not pollute the environment.

When consumers consider the formulation of cosmetic and personal care products, “ten years ago, sustainability would not be the first word that came to mind when palm oil was mentioned,” said Jaap Raijmans, Product Line Manager, Oleochemicals at Golden Agri-Resources (GAR). The Singaporean palm oil company, who has recently expanded operations into the United States, is “a seed-to-shelf agribusiness across the palm oil value chain,” who is focusing its operations on “developing and growing seeds to managing plantations, mills and refineries that produce consumer products, biofuels and oleochemicals,” said Marcus Hattar, US Commercial Manager for Oleochemicals at GAR.

“With increasing consumer concern about the role of fossil-fuel-based petrochemicals in climate change,” Hattar continued, “there’s an established and growing demand for plant-based products, including oleochemicals, as a greener and natural alternative.”

We spoke to Raijmans and Hattar to learn more about the advantages of palm oil oleochemical production as a sustainable alternative to petroleum products in the beauty industry, the ways that GAR is working to address issues related to sustainable palm oil production and supply, and future goals for palm oil oleochemicals in beauty and personal care.

A sustainable alternative to petroleum

Palm oil has a wide variety of applications and uses, including as cooking oil, in household cleaners, and in a variety of beauty and personal care products. As detailed by the Roundtable on Sustainable Palm Oil, “despite its unique qualities as a product and its high demand, palm oil has a mixed reputation,” because if it is “produced unsustainably, it can have negative impacts – on the environment, on wildlife and on human rights” including deforestation and exploitation of workers.

When palm has been grown sustainably​, however, “palm-derived oleochemicals [can make] a compelling substitute for producers looking to replace petroleum-based ingredients such as fatty alcohols in cosmetics manufacture,” shared Raijmans.

Additionally, when compared to other vegetables used to create oleochemicals like coconut or rapeseed, palm also offers other sustainable advantages. “Palm is the world’s most productive vegetable oil,” Raijmans explained, “producing 3.5 tons of palm oil per hectare compared to 0.5 tons of soybean or 0.7 tons of sunflower using the same amount of land.”

As “land use for agriculture and forestry contributes to around one-fifth of greenhouse gas emissions​, ingredient choice plays an integral in developing more sustainable formulations,” Raijmans said.

Regarding the production of more sustainable beauty and personal care product formulations, Raijmans added, “palm-derived oleochemicals are interchangeable with their petrochemical counterparts in many cosmetics applications, to give a formulation that’s safe, traceable and plant-based, while reducing carbon emissions compared to petrochemicals.”

GAR & sustainable palm oil production

Considering the rise in consumer awareness and interest in beauty and personal care formulations compositions when considering a product’s sustainable footprint, “palm oil’s safety and quality credentials also offer an advantage,” said Raijmans. “According to McKinsey,” he cited, “almost half of Gen-Z consumers​ won’t make a beauty purchase until they’ve done extensive research on the ingredients that are inside.”

GAR has therefore ensured “that all palm-based raw materials meet Non-GMO standards,” Raijmans said, as the company’s “oleochemical supply chains are Roundtable on Sustainable Palm Oil (RSPO) certified, and we meet ISO standards for quality and environmental management."

While “from a formulation perspective, we don’t see major challenges for customers using or switching to palm-based products,” he continued, “the most pressing challenge is ensuring the supply of sustainably produced palm derivatives.” In recent years, he added, “demand for palm-derived oleochemicals has consistently outstripped supply, posing a risk of price escalation that risks reducing interest in these sustainably produced alternatives.”

Therefore, to actively address this issue, GAR has focused its efforts on boosting supplies of sustainable palm oil by “elevating production through GAR's replanting program, which replaces aging, less-efficient trees with more productive ones, enhancing oil yield from the same planted area,” explained Raijmans.

Additional GAR efforts to increase the availability of sustainably sourced palm oil include expanding “smallholder certification, exemplified by initiatives like the Sawit Terampil program, which recently incorporated 270 independent farmers into our RSPO-certified supply chain, to increase available of sustainable feedstock,” he shared further.

“At an industry level,” he added, “the RSPO’s drive to certify more kernel crushing plants should open new routes to market for certified sustainable palm kernel oil and derivatives.”

Further innovation for sustainable palm in cosmetics and PBC

Moving forward, “there are a lot of opportunities for growth when it comes to palm oil oleochemicals for beauty and personal care,” said Hattar. For example, “as the industry continues to focus on sustainability and innovation, we can expect to see further development and innovative applications of palm oil-derived ingredients, such as Propylene Glycol from glycerine instead of the traditional petrochemical route,” he illustrated.

Additionally, Hattar opined that “we’ll continue to see more demand for sustainable agricultural practices from customers and consumers.” Considering that “the US Forest Act [is] back on the agenda, following similar legislation in Europe in the form of the EUDR, as well as the incoming Modernization of Cosmetics Regulation Act (MoCRA)​,” he added, “supply chain transparency and regulatory compliance will remain vital.”

Therefore, Hattar concluded, “GAR is committed to increasing our presence in the US market and oleochemicals play an important part in that strategy.”