Wilmar focuses on traceability based on the quantity of oil from traceable sources, but we also identify the number of mills in our supply chain, the names of mills supplying crude palm oil (CPO) and palm kernels (PK) to our downstream facilities, and certification status of our products. We welcome any input from our customers and other stakeholders on our approach.
For a mill to be considered traceable we require:
- Parent company name
- Mill name
- Longitude and Latitude coordinates
Where any part of this information is incomplete, volumes from that particular supplier will be treated as “untraceable”. “Untraceable” does not mean that we do not know who we procure from but that it does not fully meet the above criteria.
Wilmar’s calculations of traceable quantities of oil (known as volumetric calculation) include all of the above requirements from each of the mills. Without any of the above data we classify a mill as untraceable. For products Wilmar buy from third party refineries, traders and/or bulking installations, if it does not have information of the supplying mills, the source is classified as unknown, and products from it are not traceable. Untraceable mills and unknowns considered are declared on the summary sheet of all Wilmar crusher/refinery facilities in Indonesia and Malaysia.
The annual traceability values are calculated on volume supplied during the previous four quarters on a rolling basis for origin and destination refineries. As the mill lists are updated on a quarterly basis, and each update covers four calendar quarters, therefore it can take up to four rolling quarters for changes in material from mills to be reflected on our mill list.
The traceability data for refineries at origin (Malaysia and Indonesia) is calculated using volumes received from individual mills, Wilmar-owned and third-party refinery transfers, traders and bulking installations; the traceability data for the refineries at destination (all other countries), otherwise also known as 2nd refiners, is calculated from shipment volumes received at the respective destinations. The quantity of oil from each origin has been multiplied by its traceability to calculate overall traceability. Summaries of these refineries on the “Supply Chain Map” section and the “Country Statistics” section include traceability statistics and identify the known source of refineries and trades.
The proportion of traceable mills is sometimes used to declare traceability, referred to as the numeric calculation. The qualifying criteria of this approach are the same as those of the volumetric approach, except that volumes are not required.
Examples of both the volumetric and numeric calculations are illustrated below; both examples relate to the same scenario. It is clear that the results can vary depending on the approach taken, because they represent different things. In summary the:
- Volumetric calculation identifies the proportion of product that is derived from traceable mills.
- Numeric calculation identifies the proportion of the mills that are traceable,
Table 1. Palm Products NUMERIC traceability example
Table 2. Palm Products VOLUMETRIC traceability example