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Ferrero to stop buying palm oil from Malaysia's Sime Darby over labor concerns
Although Ferrero buys relatively little of the edible oil from Sime Darby, its move - following similar halts by Hershey and General Mills Inc - is a further reputational blow for Sime Darby and for Malaysia.
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A worker collects palm fruit at a plantation in Bahau, Negeri Sembilan, Malaysia, on Jan. 30, 2019. (Reuters/Lai Seng Sin)
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talian confectionary giant Ferrero said it will stop sourcing palm oil from Sime Darby Plantation after the US customs service found the Malaysian planter used forced labor.
"Ferrero will comply with the US Customs and Border Protection's decision," Ferrero, which uses palm oil its in Ferrero Rocher chocolates and Nutella spread, told Reuters by email.
It said it has asked its global suppliers to stop supplying palm oil and palm kernel oil from Sime Darby.
Although Ferrero buys relatively little of the edible oil from Sime Darby, its move - following similar halts by Hershey and General Mills Inc - is a further reputational blow for Sime Darby and for Malaysia, which faces mounting allegations of labor abuses of migrant workers in various industries.
Sime Darby told Reuters it has taken steps in the area of human rights and that all its stakeholders who are committed to sustainability can be assured of its commitment and leadership in the industry. Ferrero is not a customer, it added.
Ferrero said it does not buy directly from the Malaysian firm, which it said supplies 0.25 percent of its palm oil volumes.
Following a 2020 decision that indicated "forced labor indicators" at Sime Darby, the US Customs and Border Protection said in January it had sufficient evidence that the firm's goods are subject to seizure.
