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Progressing on responsible sourcing

in the coconut oil supply chain

Responsible sourcing of coconut

AAK has been sourcing coconuts from India and Sri Lanka since the 1930s. Nowadays, Indonesia, the Philippines, and India are the three biggest coconut producers with 70 percent of the global production. We source our coconut oil from the Philippines, Indonesia and partly from India.

Coconuts as raw material

Coconut trees are often found along the shorelines of the tropics since they can tolerate saline and sandy soils, while other plants do not thrive under these conditions. This not only means that coconuts form an important source of income growing on soil with limited fertility, but also that they take on a huge importance in protecting the sandy shorelines from erosion from the sea with their elaborate root system.

Coconut-growing countries in Asia-Pacific rely on the sale of coconut products as export income. The majority of coconuts are produced by smallholder farmers. Progressing on responsible sourcing of coconut oil.

The traditional coconut supply chain

The traditional coconut supply chain is long and complex because the growing areas are far away from the mills that extract the oil from the dried coconuts (copra). Middlemen connect the farmers with the mills and deliver important logistical services.

AAKs direct coconut supply chain

In AAK, we actively include smallholders in our supply chains. In order to simplify the supply chain for the farmers we have started a direct sourcing project in Indonesia. Here our partner mill collects the copra directly from the village level, as a means to ensure that a bigger share of the value goes to the farmers.

Coconut supply chain graph

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More about our sustainability work

Our House of Sustainability

Sustainable growth is the key objective of our strategy. For us, it is about our responsibility towards all of our key stakeholders—the local communities where we operate, our customers, our employees, our investors, and our suppliers.

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Globally, palm oil is the most produced and consumed vegetable oil, accounting for 30 percent of the world’s vegetable oil production. Find out how AAK supports the move towards full sustainability in the palm oil industry.

Responsible sourcing of shea

The shea kernel is only about two and a half centimeters in diameter. But what it lacks in size it makes up in oil concentration—and a unique history.