It's versatile and cheap, prolongs the shelf life of products, and the crop grows quickly. So it's no surprise that palm oil is in a lot of consumer goods, both edible and non-edible. But there's a dark side to palm oil – a heavy cost to the environment and potentially to your health.

Only 14% of the world's palm oil is certified through the Roundtable on Sustainable Palm Oil. The remainder is often produced using farming techniques that involve deforestation, and the environmental damage resulting from this can be catastrophic. Palm oil is also high in saturated fats.

Palm oil in Australia

Palm oil is the most consumed edible oil in the world, accounting for 30% of total production in 2013. This ubiquitous oil appears to be in almost everything. 

According to the World Wildlife Fund, palm oil is present in about half the packaged products on Australian supermarket shelves – including everything from bread and biscuits to chips, chocolate and even personal care products such as shampoo. The Australian Food and Grocery Council estimates an even larger presence – about 80%.

You'd never suspect this, however, because Food Standards Australia and New Zealand (FSANZ) allows palm oil to be labelled simply as vegetable oil.

Why no label?

FSANZ was presented with a proposal to label palm oil by name for health and environmental reasons in 2008, but rejected the proposal. The body claimed that environmental issues sat beyond its scope of regulation and that consumers concerned about the saturated fat content in palm oil could see this in the nutrition information panel of food labels.

A private member's bill, proposed by SA senator Nick Xenophon in 2010 to provide clear, accurate information about the inclusion of palm oil, was knocked back by the government, which estimated it would cost industry $150m and breach Australia's World Trade Organization obligations.

In 2011, following a comprehensive review of food labelling, it was recommended that palm oil be specifically labelled. In response, FSANZ announced that the development of a technical evaluation and advice based on this recommendation would be a priority.

Who does label palm oil?

CHOICE spoke with major food manufacturers in Australia in 2013 and found there is little desire to go beyond FSANZ labelling requirements for palm oil. Leaders in the mainstream grocery market, including Arnott's, Coca Cola (SPC Ardmona), Goodman Fielder, Nestlé, Simplot, Unilever and General Mills, have been known to use palm oil but label it as vegetable oil.

When it comes to private-label goods, Coles and Woolworths both specifically identify palm oil, but Aldi labels it as vegetable oil.

Labelling laws overseas

On a comparative global scale, international palm oil labelling standards seem to serve overseas consumers better than Australian ones. From 13 December 2014, products sold in the EU containing palm oil will have to be labelled as such, according to the EU's Food Information Regulation. The US and Canada also require palm oil to be labelled.

In 2012 the French government even proposed, but later rejected, a 300% tax on palm oil, coconut oil and palm kernel oil, nicknamed the "Nutella tax".

Sustainable but still unhealthy

Many large food manufacturers have joined the Roundtable on Sustainable Palm Oil, which aims to encourage those using palm oil to purchase from sustainable sources. All the companies we spoke to responded to questions about the labelling of palm oil with information about their sustainability commitments. But just because palm oil can be sourced sustainably doesn't make it better for your health.

Although palm oil is rich in carotenoids (antioxidants), it contains more than 50% saturated fat. It doesn't contain cholesterol, but can cause raised total cholesterol and “bad” cholesterol levels, depending on the levels of other fats in the diet.

The World Health Organisation believes there’s convincing evidence that palmitic acid (which is found in palm oil) contributes to an increase in the risk of cardiovascular disease, and for heart health the Heart Foundation recommends steering clear of high saturated fat ingredients, such as palm oil.

What CHOICE wants

CHOICE believes that in order for consumers to make an informed decision to avoid palm oil, accurate labelling is vital. Our Palm Oil Labelling campaign is demanding that it be made mandatory for food labels to list palm oil in the ingredients list, rather than hiding it as unspecified vegetable oil.