Nestle drops palm oil supplier

Nestle says it has dumped an Indonesian palm oil supplier due to concerns about the company's environmental record.

The announcement comes a day after Greenpeace released a report which looked into how the company was sourcing palm oil, Reuters reported.

Nestle used the oil in products such as KitKat bars, but said it had replaced Sinar Mas with another supplier after conducting investigations into its palm oil supply chain.

"We will continue to pressure our suppliers to eliminate any sources of palm oil which are related to rainforest destruction and to provide valid guarantees of traceability as quickly as possible," Nestle said in a statement.

The manufacturer said palm oil bought from Sinar Mas had only been used for production in Indonesia and not in any other country.

- NZHERALD STAFF