Partnering to build a responsible PKE supply chain

Sustainable, ethical, and responsible production by the food industry is an important part of curbing global warming, conserving biodiversity and upholding the rights of indigenous communities and smallholders. That's why ADM has set a goal to be deforestation-free in all our supply chains by 2025.The last decade has seen significant advancements in tackling deforestation in Indonesia and Malaysia. Increased collective action between NGOs, civil society, smallholders, business, and national and sub-national government has been critical to drive progress to reduce deforestation, fires, and improving communities, as well as addressing issues related to land rights. However, continued and concerted action is still needed in these regions to maintain progress.

ADM is working closely with our customers to create a differentiated approach to sourcing key commodities including Palm Kernel Expeller (PKE) – a by-product of the palm oil extraction process from the fruit of the palm – which is used in animal feed due to its high protein content. Over the last three years we have established a deforestation-free supply chain of PKE from Asia as part of our palm sustainability approach. Our experience with the implementation of the ADM Palm Responsible Sourcing Supplier Program enabled us to offer our customer, De Heus Voeders, a tailor-made solution which is based on four pillars: supply chain traceability; supplier engagement; monitoring & verification; and reporting. In palm, we have consistently gained visibility of our supply chain and supported transformation of the priority landscapes.

"The collaboration with ADM helps us achieve our commitment to source raw materials sustainably and reduce our carbon footprint. Above all, it contributes to our goal to create value and impact within the food production supply chain in which we operate," says Eline Vervoorn, Sustainability Manager at De Heus Voeders.

Our three-year PKE Responsible Sourcing supplier program encompasses:

Supplier Engagement: ADM engaged 100% of its own direct PKE suppliers in Indonesia and Malaysia, including:

Discussions on various sustainability topics such as ADM’s responsible palm policies and commitments, and sharing tools and knowledge about tackling the critical issues.
Assessing all our suppliers using the palm scorecard which links to recommended actions for each supplier. This work seeks to continuously improve supplier sustainability performance and reinforce ADM’s responsible sourcing expectations.

Responsible Sourcing: We have worked hard with suppliers in Indonesia and Malaysia to increase traceability, ensure third party verification of deforestation and reduce our carbon footprint. ADM now implements SMETA (Sedex Members Ethical Trade Audit) to cover social criteria including wages, right to work, working hours, health and safety, temporary work, provision of rest time and fair treatment of staff.

"As a result of ADM's programme, this PKE supply chain has been fully verified by a 3^rd party audit. ADM is delivering sustainable PKE to the European feed market by way of our customer De Heus Voeders at a time when consumers are calling for deforestation free and less carbon intense products. Through their commitment to their farm customers and sustainability, De Heus will be able to deliver feed to Dutch farmers and meet customer demands for responsibly sourced products," says Emmanuel Lemoine, Vice President, Global Feedstuffs.

We are working to replicate our progress with other PKE customer supply chains to reach our targets as soon as possible.

ADM will also strengthen its commitment with local communities, investing part of the funds of the PKE project on the transformation of the landscapes where the product comes from, therefore building a more resilient supply chain.