Supermarkets, food manufacturers and restaurant chains under pressure from campaigners over their environmental impact urged Britain on Monday to strengthen a plan to stop tropical forests from being cut down to grow cocoa, palm oil and soy.
With the food industry under growing scrutiny for its role in driving deforestation in countries such as Brazil and Indonesia, Britain is drawing up legislation to force the sector to tighten oversight of its supply chains.
In an open letter, some 20 large companies welcomed the plans as a "step forward" but said "it's not currently envisioned to be enough to halt deforestation and we encourage the government to go further to ... address this issue."
Signatories included supermarkets Tesco, Marks & Spencer, Morrison's and Sainsbury's, food manufacturers Unilever, Nestle and Greencore Group, McDonald's Corp and various livestock producers.
Britain's move to introduce legal penalties for companies found to be complicit in deforestation aims to improve upon a range of voluntary, industry-led initiatives that have faced widespread criticism from environmental groups.
Companies say they would prefer clear direction from governments that would create standard rules rather than navigating the existing maze of voluntary intiatives.
Under the proposed legislation, large companies would have to report on how they source tropical commodities. The companies would also be banned from using products that are harvested illegally in their country of origin.
But the supermarkets and food companies who signed the letter say the proposed new law has a major loophole: farmers in developing countries can often clear forests to grow cash crops for export without breaking any laws.
The companies want the new British rules to apply to all deforestation - not just in cases where the destruction is illegal.
"The proposed legislation would continue to allow rampant deforestation in hotspots such as Indonesia and Brazil," said Robin Willoughby, UK director of campaign group Mighty Earth.
Companies are also concerned that the legislation would not apply to smaller firms who may import considerable amounts of products, such as rubber, from sensitive forest regions.
Cyril Kormos, executive director of Wild Heritage, a nonprofit based in Berkeley, California, said a more comprehensive overhaul of forest management rules globally would be needed to reverse the loss of old-growth forests, whose stores of carbon form bastions to slow climate change.
"Deforestation pledges only go so far," Kormos said. "We need an equivalent focus on ending degradation of primary forests."
There exists a huge gap between public's intention and actions when it comes to health and wellness with cost being a major deciding factor, shows a recent report, also highlighting a shift in how people structure their meals and attitudes towards global mental and physical health.
Kantar's Who Cares Who Does: Decoding Wellness further adds thatwhile 62 per cent see processed food as harmful, only 37 per cent actively avoid it. It’s a similar pattern for sugary drinks: 73 per cent see them as harmful, but fewer than half (48 per cent) are cutting back on products high in sugar.
Savoury snacks and carbonated soft drinks have the highest product penetration of the FMCG product categories at 90 per cent and 77 per cent respectively.
Cost holds a strong influence over people’s ability to choose healthy products. More than half of people (52 per cent) cite the high cost of healthier options as the main barrier to buying them. Meanwhile, a lack of trust and confusion about what constitutes truly healthy packaged foods also prevents consumers from being able to make healthy choices.
It was seen earlier in Kantar Worldpanel’s Demand Moments that howsnacking has become a full-blown behaviour in the UK, Germany and other markets. In the UK, snacks now make up 28 per cent of eating occasions, surpassing breakfast at 27 per cent, showing a shift in how people structure their meals.
Natalie Babbage, Global Solutions Director, at Kantar Worldpanel at Kantar, said, “People want to do better but are caught in cycles of stress, unhealthy eating habits, and barriers to effective weight management, which are often exacerbated by high costs.
"Brands have a critical opportunity to make a difference. By tackling affordability, convenience, transparency, and emotional needs, they can bridge the gap between how people want to live and their reality, helping improve health outcomes for people around the world.”
The report also shows that while78 per cent of people believe they are responsible for their health, less than half proactively engage with their physical health, and even fewer invest effort into their mental wellbeing.
Diageo Great Britain has on Tuesday launched the Diageo Luxury Company, a new division dedicated to transforming Diageo’s performance in the luxury beverage sector in its home market.
The division unites existing colleagues in marketing, sales, and commercial teams under a new unified strategy and leadership team, with the launch intending to boost Diageo’s presence in the super-premium and premium segments.
The Diageo Luxury Company (DLC) will focus on bold and locally relevant innovations and brand building, as well as exciting consumer experiences across both the on and off-trades, as well as digital channels.
The DLC will have a clear portfolio focus, activating five luxury spirit brands across GB: Don Julio, Casamigos, Johnnie Walker, The Singleton, and Ciroc. Accelerating the role that these brands play in culture will be an integral part of the DLC’s growth ambition, building on recent successes such as last summer’s Casamigos’ three-floor ‘Casa House’ at All Points East Festival in London, and last month’s Johnnie Walker Blue Label ‘Ice Chalet’ experience at Selfridges, London.
The announcement comes as Diageo PLC has launched The Diageo Luxury Group, a newly created global division for Diageo’s most valuable and exceptional assets. While the DLC will work with The Diageo Luxury Group, it will operate under the Diageo GB business alongside the market’s other core spirits and beer brands.
Hinesh Shah
The new division will be led by Hinesh Shah who will serve as general manager of the DLC. Shah has been at Diageo for almost 14 years, spending most of his career in North America working in roles across finance, sales, strategy and working with the largest customers and distributors in the world. His most recent tole was Vice President – Commercial transformation in North America.
With a deep connection to Diageo’s luxury portfolio, Shah picks Johnnie Walker as the brand he is most excited to work with, a brand he says takes him back to special celebratory moments, including his graduation and anniversaries.
“We have built a strong foundation in the luxury beverage space, driving the likes of Johnnie Walker, Don Julio, and Casamigos to the heart of the luxury conversation. But it’s time to take it to the next level, utilising our incredible trade partnerships and marketing expertise to grow our luxury brands like never before,” Shah commented.
“I’m incredibly proud to lead what will become a high-performing team, united under one bold vision - to become the premier luxury drinks company in GB.”
Nuno Teles, managing director at Diageo GB, added: “Through innovation, investing in diverse talent, and a commitment to excellence in execution, the DLC promises to shape the future of luxury beverages. Our GB business has a proud history of developing authentically crafted brands, and I’m confident that Hinesh and his team will engrain these brands, and the tequila and scotch categories, into the future of luxury celebrations.”
France's wine output is expected to fall by nearly a quarter this year after adverse weather hurt vineyards throughout the cycle with the Champagne region most hit, the French farm ministry said on Friday.
In a monthly report, the ministry projected wine output this year at 36.9 million hectolitres, down from 37.5 million forecast last month and now 23 per cent below last year's small vintage when there had been major disparities between regions.
The revised forecast, based on the latest harvest results, was 17 per cent below the five-year average of 44.2 million hectolitres.
A hectolitre is the equivalent of 100 litres, or 133 standard wine bottles.
"This year was characterised by unfavorable weather, with precipitation from flowering to harvest in most wine-growing areas and health problems that reduced volumes," the ministry said in a monthly report.
"In many vineyards, flowering took place in cool and damp conditions, leading to "coulure" (dropping of flowers and young grapes) and "millerandage" (formation of small grapes). Added to this were losses due to frost in the spring, mildew and hail in the summer," the ministry said.
All types of wine were affected, as well as those intended for the distilled spirit eau-de-vie which benefited from an exceptional harvest in 2023, it said.
Champagne recorded the sharpest fall in output among large wine-producing regions this year with a fall 46 per cent from a good 2023 and 31 per cent below the five-year average.
"In addition to the lack of sunshine which disrupted the development of the grapes, there were spring frosts, mildew, hail, scalding and excessive rainfall," the ministry said, referring to the Champagne region.
Champagne producers in July had called for a cut in the number of grapes harvested this year after sales of the wine fell more than 15 per cent in the first half of the year as customers tightened their belts due to an uncertain economy.
(Reuters)
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A view of palm oil plantation on November 13, 2016 in Trumon subdistrict, South Aceh, Aceh province, Indonesia
Nestle, P&G investigate palm oil sourcing after green group's deforestation report
Consumer brands including Nestle and Procter & Gamble said they conducted investigations after an environmental group said palm oil sourced from an illegally cleared wildlife reserve in Indonesia may have found its way into their supply chains.
Rainforests within the legally protected wildlife reserve had been cleared to make way for palm oil plantations during the last eight years, the US-based Rainforest Action Network (RAN) said, citing satellite images that it says reveal deforestation in the area.
The group shared images which it said showed stretches of cleared brown land cut into the lush green expanse of Indonesia's Rawa Singkil Wildlife Reserve, with rows of young palm trees now planted along its borders.
Some images, which RAN said were taken during a field investigation in February 2024, showed that oil palm seedlings were planted on burnt ground surrounded by fallen trees inside the reserve, according to the report published on Monday.
The wildlife reserve, located in Aceh province in the northwest of Indonesia's Sumatra island, has lost 2,609 hectares (6,447 acres) of forest since 2016, with palm trees now growing on 645 hectares of the cleared area, RAN said.
Indonesia's forestry ministry did not respond to a request for comment.
RAN said its investigation, conducted in September and October, had found fresh fruit bunches from the illegal plantations were sold to mills PT Global Sawit Semesta (GSS) and PT Aceh Trumon Anugerah Kita (ATAK), both of which supplied major brands including Procter & Gamble, Nestlé, Mondelez and PepsiCo, according to the RAN report.
GSS and ATAK, which are located in remote areas, could not be reached by Reuters for comment.
Companies typically source palm oil from Indonesian mills through intermediaries.
A Nestle spokesperson said it promptly engaged with its direct supplier regarding GSS to investigate RAN's findings, adding that, by the end of 2023, 96 per cent of its palm oil supply was "deforestation-free".
"Should there be a need to find remedies, we will take necessary action," the spokesperson said.
Procter & Gamble told Reuters that it had conducted an investigation following RAN's findings and immediately suspended sourcing from both GSS and ATAK.
Singapore-based Royal Golden Eagle Group (RGE), Musim Mas and Indonesian firm Permata Hijau also sourced palm oil from GSS, RAN said.
Apical, an RGE unit, said the firm has engaged with GSS to look into a supplier who allegedly sourced illegal fresh fruit bunches from the reserve. GSS has suspended the said supplier since late October until investigations are concluded, Apical said.
Musim Mas said they were investigating RAN's findings. Permata Hijau, Mondelez and Pepsi did not respond to multiple emailed requests for comment.
'Orangutan Capital'
Indonesia, home to the world's third largest tropical rainforest, says it reduced its deforestation rate to under 140,000 hectares annually between 2020 and 2023, down from more than 400,000 hectares in 2016-2020.
However, RAN said its investigation showed that deforestation within the wildlife reserve — the country's only forest where endangered orangutans, tigers, elephants and rhinos coexist — surged fourfold in 2021-2023 compared with the previous period, despite laws banning deforestation.
"The high-resolution imagery and analysis definitively show that the palm oil mills, traders, and global brands sourcing from this area have failed to end deforestation for palm oil in the 'Orangutan Capital of the World'," RAN said in its report.
Green groups have frequently accused palm oil producers of illegally clearing rainforests, including protected areas and wildlife reserves, to expand their plantations.
Global palm oil production has expanded over the past decade, accounting for 60 per cent of world vegetable oil exports. Mainly produced in Indonesia and Malaysia, palm oil is used as a cooking oil and in products including biofuels, chocolates and cosmetics.
Take-home sales at the grocers increased by 2.3 per cent over the four weeks to 3 November 2024 to reach £11.6 billion, making this the biggest sales month of the year so far according to the latest data from Kantar.
The take-home sales rise coincided with a jump in the number of shopping trips made by households, hitting a four-year high at 480 million.
“October 2024 was the busiest month for the supermarkets since March 2020, when people were preparing for the first national lockdown,” Fraser McKevitt, head of retail and consumer insight at Kantar, commented.
“Trip numbers have been going up gradually for some time, but this steady march hasn’t reached pre-covid levels of shopping frequency just yet. The average for each household is slightly over four trips per week.”
Halloween played a part in galvanising sales and there are signs that some consumers are looking further ahead in the calendar, starting their Christmas shopping early, McKevitt noted.
Some 3.2 million households bought at least one pumpkin, and confectionery spending got a boost to £525 million in October as sales of chocolates and sweets both went up, climbing by 13 per cent and 7 per cent each.
“What’s interesting this month is the number of households who are already stocking up the cupboards for the big day in December,” McKevitt said.
“Some people think Christmas ads hit our screens too soon but it’s clearly important for retailers to set out their stalls early. 648,000 shoppers have already bought a Christmas cake, while 14.4 per cent of households picked up mince pies in October. With Black Friday on the horizon, the grocers will be hoping to capture a slice of the action there too. In the week up to 26 November last year, online and offline sales for typical Black Friday categories across all high street retailers were £1.6 billion higher than during an average week in 2023.”
Grocery price inflation was 2.3 per cent this period, up slightly on September’s figure but still within typical levels. The rate has now been below 3.0 per cent every month since the early summer.
Promotional activity by the grocers is helping to keep prices down and supporting sales of branded goods in particular, McKevitt explained.
“Spending on deals has been going up consistently for the past 18 months and it now makes up 28.6 per cent of all sales. Offers are helping to lift branded sales especially. The growth gap between brands and own-label is the biggest it’s been since February 2021, sitting at 4.9 per cent and 2.7 per cent apiece,” he added.
Ocado topped the growth table, boosting its sales by 9.5 per cent over the 12 weeks to 3 November 2024. With sales up by 7.4 per cent, Lidl was the fastest growing retailer with a bricks and mortar presence for the 15th period in a row, continuing this run into a second year.
Asda continued to see sales declining, being the worst performer in the three-month period to 03 November with a 5.5 per cent drop. Symbols and independents saw a sales decrease of 1.3 per cent, and Co-op, 2.1 per cent.
The two largest supermarkets in Great Britain also outperformed the wider market. With sales up across all its store formats and online, Tesco’s sales rose by 4.6 per cent taking it to 27.9 per cent of the market, up 0.6 percentage points on last year. Spending through the tills at Sainsbury’s climbed 4.4 per cent, making its overall share 15.5 per cent.
Asda’s hold of the market is now 12.5 per cent. Morrison’s sales grew by 2.4 per cent, outpacing the market average for the first time since June 2021. Its share of take-home sales remains at 8.6 per cent. Aldi held its share of the market steady year on year at 10.4 per cent.
Co-op and Waitrose’s shares sit at 5.7 per cent and 4.6 per cent respectively. Iceland now makes up 2.2 per cent of the market, the same proportion as a year ago.