Iceland ban palm oil, the expected impacts on food industry
April 12, 2018
The controversy surrounding the cultivation of palm oil is the reason for the current move by retailers such as Iceland. The cultivation, as well as the growing demand for the product in South East Asia are partly responsible for deforestation and causing significant threat to the tropical rainforest which houses numerous endangered species, such as the Orangutan, whose population has halved in the last decade.
The effect of climate change will increase the clamor for more businesses and retailers to abandon use of palm oil as a strategy for resuscitating the environment.
Aside Iceland, retail brands such as Tesco and Sainsbury are making effort to replace palm oil content within their products in the nearest future. The implication of this on the price of palm oil is obvious; there will be a sharp decline due to the drastic lowering of demand.
The use of palm oil in foods will translate to the sourcing of more sustainable ingredients in the future. This may result in the increase of the price of goods that currently make use of the product.
With plans and commitment by companies to distance themselves from products such as palm oil that contribute to deforestation by 2020, one wonders what will become of the product in the coming years.