Report: Child Labor, Land Grabbing and Deforestation Rampant Across Palm Oil Giant KLK’s Operations

Four case studies document widespread abuses by Cargill palm oil supplier Kuala Lumpur Kepong (KLK)

San Francisco, CA – A report released today by Rainforest Action Network (RAN) exposes systemic environmental and human rights violations across the global operations of Malaysia-based palm oil producer Kuala Lumpur Kepong (KLK). The report, titled “Conflict Palm Oil in Practice: Exposing KLK’s Role in Rainforest Destruction, Land Grabbing and Child Labor” details four cases of Conflict Palm Oil production by KLK.

KLK is a major supplier to US agribusiness trader Cargill and is Malaysia’s third largest listed plantation company with annual revenues of $2.8 billion USD. KLK has a land bank in Indonesia and Malaysia that stands close to 250,000 hectares (over 600,000 acres) and the company has major expansion plans in Papua New Guinea and Liberia that face active local opposition.

“The sheer magnitude of the abuse that KLK has engaged in is shocking. And unfortunately, due to the murky world of palm oil traders and suppliers, KLK is able to continue to operate with impunity while major traders, like Cargill, continue to purchase the palm oil it produces to sell to food manufacturers in the United States and around the world,” said Robin Averbeck, senior forest campaigner with Rainforest Action Network. “From Liberia to Indonesia to Papua New Guinea, KLK is involved in everything from the destruction of endangered orangutan habitat to widespread child labor and the violation of the rights of Indigenous Peoples.”

Today’s report profiles four separate instances of KLK’s involvement in Conflict Palm Oil production, including:

KLK’s hotly contested expansion plans into the ancestral lands of tribal groups in the remote Collingwood Bay area of Papua New Guinea without the Free, Prior and Informed Consent of the local Indigenous communities.
KLK’s use of child labor and forced labor on two plantations in Indonesia.
On-going destruction of natural rainforests on two KLK plantations in Indonesia.
Expansion by KLK’s newly acquired Equatorial Palm Oil onto traditional farming lands of local communities in Liberia in violation of their Free, Prior and Informed Consent.
In the report, RAN calls on KLK and Cargill to adopt and implement responsible palm oil policies that require the production and sourcing of palm oil that is fully traceable, legally grown and verified as not associated with deforestation, expansion of carbon-rich peatlands of any depth, or the violation of human or labor rights.

KLK’s customers include Cargill, California Oils, Fuji Oils, Unilever and Proctor & Gamble. From 2011-2013, Cargill received at least 31 shipments of palm oil from KLK, totaling more than 61 million pounds. Cargill has sold palm oil and its derivatives to Nestlé, General Mills, Kraft Foods, and Kellogg.

The report warns that companies like PepsiCo, Kraft, ConAgra, Heinz and Campbell’s Soup Company, that do not have a responsible palm oil policy or traceability systems in place, are at a high risk of sourcing Conflict Palm Oil from companies like KLK.

RAN first implicated KLK in child labor practices in 2010 and in 2013 KLK was the focus of a nine-month field investigation conducted by the Schuster Institute for Investigative Journalism that was published last July at The investigation, which took place on a dozen different plantations across Sumatra and Borneo, found extensive evidence of workers, many of whom were children, being defrauded, abused, and held captive by KLK’s labor management subcontractor.

“As long as Cargill continues to purchase Conflict Palm Oil, no questions asked, from reprehensible companies like KLK, KLK and its peers have absolutely no motivation to change. Why stop using child labor or stealing land when nobody is holding them accountable?” asked Rainforest Action Network’s Robin Averbeck. “Cargill needs to implement a responsible palm oil sourcing policy that blacklists any company that produces Conflict Palm Oil and engages in horrific human rights and environmental abuses immediately. Time is running out. Cargill is lagging behind other traders that have realized that business as usual is no longer tenable.”