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PemPem develops traceability tools for smallholders to adapt to EU requirements on deforestation-free supply chains

Justine McIntyre

Feb 15, 2023

PemPem offers a traceability solution adapted to smallholders that is helping to advance the sustainability transformation of the palm fruit supply chain.

PemPem welcomes the European Union accord banning the importation of targeted products, including palm oil, when these are linked to deforestation. Palm oil represents more than one-third of the total value of targeted imports, ahead of soy, wood, cacao, coffee and beef due to its widespread usage in food, cosmetics and other consumer products. 

With the adoption of the new trade regulation, the EU aims to provide the impetus for commodity producing countries to accelerate the transformation of supply chains to sustainable ones by requiring traceability. However in order to ensure fair access to EU markets, it is essential that smallholder farmers have access to traceability tools.

PemPem offers a solution adapted to smallholders to ensure the traceability of their palm fruit and in doing so, is helping to advance the transformation of the palm fruit supply chain to a sustainable one that is respectful of the environment and of communities.

"Up until now, traceability was considered a nice-to-have; this new requirement from the EU puts the onus on commodity suppliers to demonstrate proof of origin,"  declares founder and CEO Joann de Zegher. “I’m optimistic that the European trade regulation will act as an accelerator for a process already underway of transforming opaque supply chains into traceable and sustainable ones.”  

Indonesia generates more than half of global palm oil production, with 40% of its production coming from smallholder farmers, of which the vast majority still operate informally via undocumented cash transactions. With Niaga, a digital trading platform for buyers and smallholder sellers of unprocessed palm fruit, PemPem is the first to bring real-time traceability to smallholder palm oil farmers in Indonesia, from farm to mill. 

Niaga aims to facilitate access to European markets for smallholders producing palm fruit sustainably — without causing loss to forest cover — by demonstrating fruit origin through documented, traceable and verifiable transactions. The platform has witnessed a month-over-month average growth rate of 160% in gross merchandise value (GMV) since launch.

Presently operating in smallholder palm fruit markets in Indonesia, PemPem aims to expand Niaga to other raw commodities markets. PemPem is concurrently developing additional products to accommodate the various needs of commodity traders selling to the EU.  

About PemPem

PemPem provides financial instruments and supply chain software that increase the efficiency of micro-enterprises in commodity markets, enabling them to be successful while reducing pressure on natural resources. PemPem currently operates in palm fruit markets, facilitating transactions between small-scale producers and buyers. 

For information or to request an interview, please contact:

Justine McIntyre

Communications advisor


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