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TROUBLING ORIGINS. Ranging in age from six to 102, women in a family who have worked on a palm-oil plantation for five generations hold out the palms of their hands in Malaysia. Like many laborers, they cannot afford to give up the company’s basic subsidized housing, creating a generational cycle that helps ensure a cheap, built-in labor force. (AP Photo)

From The Asian Reporter, V31, #1 (January 4, 2021), page 4.

U.S. bans second Malaysian palm oil giant over forced labor

By Margie Mason and Robin McDowell

The Associated Press

The U.S. said it will ban all shipments of palm oil from one of the world’s biggest producers after finding indicators of forced labor and other abuses on plantations that feed into the supply chains of some of America’s most famous food and cosmetic companies.

The order against Malaysian-owned Sime Darby Plantation Berhad and its local subsidiaries, joint ventures, and affiliates followed an intensive months-long investigation by the U.S. Customs and Border Protection’s Office of Trade, said Ana Hinojosa, one of the agency’s executive directors.

Hinojosa said the investigation "reasonably indicates" abuses against workers that included physical and sexual violence, restriction of movement, intimidation and threats, debt bondage, withholding of wages, and excessive overtime. Some of the problems appeared to be systemic, occurring on numerous plantations, which stretch across wide swaths of the country, she said.

"Importers should know that there are reputational, financial, and legal risks associated with importing goods made by forced labor into the United States," Hinojosa said in a telephone press briefing.

The order was announced just three months after the federal government slapped the same ban on another Malaysian palm oil giant, FGV Holdings Berhad — the first palm oil company ever targeted by Customs over concerns about forced labor. The U.S. imported $410 million of crude palm oil from Malaysia in fiscal year 2020, representing a third of the total value shipped in.

The bans, triggered by petitions filed by nonprofit groups and a law firm, came in the wake of an in-depth investigation by The Associated Press into labor abuses on plantations in Malaysia and neighboring Indonesia, which together produce about 85% of the $65-billion supply of the world’s most consumed vegetable oil. Palm oil can be found in roughly half the products on supermarket shelves and in most cosmetic brands. It’s in paints, plywood, pesticides, animal feed, biofuels, and even hand sanitizer.

The AP interviewed more than 130 current and former workers from two dozen palm oil companies, including Sime Darby, for its investigation. Reporters found everything from rape and child labor to trafficking and outright slavery on plantations in both countries.

Earlier in December, 25 Democratic lawmakers from the U.S. House Ways and Means Committee cited AP’s investigation in a letter calling for the government to come down harder on the palm-oil industry in Malaysia and Indonesia, asking Customs and Border Protection if it had considered a blanket ban on imports from those countries.

"In our view, these odious labor practices and their pervasive impact across supply chains highlight the need for an aggressive and effective enforcement strategy," the letter said.

Sime Darby, which did not immediately comment, has palm-oil plantations covering nearly 1.5 million acres, making it one of Malaysia’s largest producers. It supplies to some of the biggest names in the business, from Cargill to Nestle, Unilever and L’Óreal, according to the companies’ most recently published supplier and palm-oil mill lists.

Hinojosa said the agency’s decision to issue the ban should send an "unambiguous" message to the trade community.

"Consumers have a right to know where the palm oil is coming from and the conditions under which that palm oil is produced and what products that particular palm oil is going into," she said.

Meanwhile, Duncan Jepson of the anti-trafficking group Liberty Shared, which submitted the petition leading to the Sime Darby ban, filed two additional complaints — one to the UK’s Home Office, questioning the company’s disclosure about its protection of human rights under the country’s Modern Slavery Act, and the other to the Malaysian stock exchange, regarding the company’s stated commitments to sustainability. Both complaints questioned the accuracy of Sime Darby’s disclosures in light of the CPB’s findings.

Jepson said the U.S. ban also should be a red flag for Asian and western financial institutions that have helped support the industry, saying ties to forced labor could have serious consequences for banks and lenders.

The U.S. government’s announcement about Sime Darby marked the 14th time in 2020 that Customs has issued an order to detain shipments from an array of sectors following similar investigations into forced labor. They include seafood and cotton, along with human hair pieces believed to have been made by persecuted Uighur Muslims in Chinese labor camps.

Under last month’s order, palm-oil products or derivatives traceable to Sime Darby will be detained at U.S. ports. Shipments can be exported if the company is unable to prove that the goods were not produced with forced labor.

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COOKIE CONCERNS. A child collects palm kernels from the ground at a palm oil plantation in Sumatra, Indonesia, in this November 13, 2017 file photo. The Girl Scouts of the USA say child labor has no place in its iconic cookies and called on the two companies that bake them to act quickly to address any potential abuses linked to the palm oil in their supply chains. (AP Photo/Binsar Bakkara, File)

From The Asian Reporter, V31, #1 (January 4, 2021), page 8.

Girl Scouts call on cookie bakers to address child labor

By The Associated Press

The Girl Scouts of the USA say child labor has no place in its iconic cookies and called on the two companies that bake them to act quickly to address any potential abuses linked to the palm oil in their supply chains.

The comments were sent in the form of a tweet to Associated Press reporters who released an investigation December 29 linking Girl Scout cookies and the supply chains of other well-known food brands to an estimated tens of thousands of children who often work unpaid for long hours in hazardous conditions to help harvest palm fruits on plantations in Indonesia and Malaysia.

"Child labor has no place in Girl Scout Cookie production," the Girl Scouts tweeted. "Our investment in the development of our world’s youth must not be facilitated by the under-development of some."

The Girl Scouts also referred to a not-for-profit global organization it belongs to called the Roundtable on Sustainable Palm Oil (RSPO), which promotes ethical production, including the treatment of workers, writing: "If certain suppliers are not following ethical practices, we expect our bakers and RSPO to take action quickly to rectify those exceptions."

The Girl Scouts had not responded to repeated requests from The AP for comment about the findings ahead of the December 29 story, which found many children working in the palm-oil industry do not have access to adequate school or healthcare and that some never learn to read or write. The story detailed how others live in fear of being rounded up by police and tossed in detention centers because they were born on plantations to parents who are working illegally, and how girls are vulnerable to sexual abuse.

Reporters traced child labor to the supply chain of one of the Girl Scout cookies’ bakers, Little Brownie Bakers, owned by the Italian confectionary brand Ferrero, which did not comment on the findings. The other baker and its parent company, Canada-based Weston Foods, did not provide any details about its supply chain, citing proprietary reasons. Both said they were committed to sourcing sustainable palm oil.

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