The Roundtable on Sustainable Palm Oil (RSPO) certifies palm oil produced according to environmental and social criteria. However, certification alone does not determine how that oil moves through the supply chain. RSPO recognises four supply chain models, each with a different balance of physical traceability, administrative effort and cost. Procurement managers and first-time buyers should understand these options before setting sourcing requirements.
Identity Preserved (IP)
Identity Preserved keeps certified palm oil from a single identified source, such as one plantation or one group of smallholders, separate from all other oil at every stage. The oil never mixes with conventional or other certified oil. This model provides the highest level of traceability and allows a buyer to claim that the product contains palm oil from that specific certified origin. IP supply is typically limited and carries a premium, so it is used mainly when a brand wants to highlight a particular producing region or support a named producer.
Segregated (SG)
Segregated allows certified palm oil from multiple certified sources to be mixed together, but it remains physically separated from conventional palm oil throughout storage, transport and processing. The final product contains only certified sustainable palm oil, though it cannot be traced back to a single farm or mill. SG is a common choice for consumer goods where an on-pack claim about certified sustainable content is needed, and it offers more supply flexibility than IP while still guaranteeing physical separation.
Mass Balance (MB)
Mass Balance permits certified and conventional palm oil to be mixed during transport, storage or processing. The system tracks certified volumes through the supply chain using documented bookkeeping. A company buying a certain volume of MB palm oil can claim that an equivalent amount of certified sustainable palm oil was produced and entered the RSPO system. The physical oil delivered may contain a blend of certified and conventional material. MB is widely used because it matches the reality of bulk commodity logistics and keeps costs lower, while still supporting certified production.
Book & Claim (B&C)
Book & Claim, also known as RSPO Credits, operates entirely outside the physical supply chain. Certified producers generate credits for the certified palm oil they produce. A buyer purchases these credits separately from its physical palm oil purchase. The physical oil used may be fully conventional, but the buyer's purchase of credits provides financial support to certified producers. B&C is often the easiest entry point for companies that cannot source certified physical oil due to complex derivative supply chains or limited availability. It does not allow an on-pack claim about certified content, but it does support sustainable production.
Choosing the right model
Choosing a model involves trade-offs. IP and SG require physical segregation and therefore more planning and higher logistics costs. MB reduces physical handling constraints but relies on robust administrative tracking. B&C avoids physical supply changes entirely. Buyers can combine models across different product lines or regions.
First-time buyers often start with B&C or MB to gain experience while supporting certified production, then move toward SG or IP if customers demand physically certified ingredients or stronger traceability. The right choice depends on supply availability, internal tracking capability and the claims a company wishes to make.