A new investigative report released by Greenpeace accused Asia Pulp & Paper (APP) of secretly planning a massive expansion of pulp mills and cutting down essential forests, including habitats for endangered tigers. APP is a subsidiary of the Indonesian conglomerate Sinar Mas.

According the Greenpeace report 'How Sinar Mas is Pulping the Planet', an internal 2007 document shows that Asia Pulp drew up plans to significantly increase its pulp mill capacity to 17.5 million tons a year from 2.6 million tons. Consequently, Asia Pulp had sought more than a million hectares in new concessions to meet this demand. In the Sumatran provinces of Riau and Jambi alone, the company sought 900,000 hectares, or 2.2 million acres, more than half of which was granted.
"What is actually happening in the field is they keep expanding because their timber concessions are not enough to supply their mills - said Bustar Maitar, of Greenpeace - This is a big question mark for the government of what forest protection will look like Mr. Maitar of Greenpeace said. If the big companies like A.P.P. or Sinar Mas as a group are still doing business as usual, still doing forest clearing, so what's the meaning of the moratorium?".

Aida Greenbury, of APP, denied to the New York Times that the company had confidentially made any such expansion plans, saying that Asia Pulp did not use wood from forests it deemed to be of high conservation value, which included deep peat and major endangered-species habitats, claiming that its fibres are coming from plantations and from degraded land or lower-value forests. But according to Greenpeace APP has cleared peatlands deeper than three meters, protected by the Indonesian law, because they releases huge amounts of greenhouse gases when burned or drained.

An investigation by The New York Times has established that APP is feeding its Indah Kiat paper mill in Sumatra, Indonesia, with thousands of tonnes of rainforest logs a week. Of the 20 giant barges witnessed queueing at the mill's port last week, five were full of rainforest logs, ten contained a mix of plantation wood and rainforest logs and five contained only plantation wood. Overall, about half of the timber was from rainforests.

Greenpeace exposed Wal-Mart, Hewlett Packard, Auchan, Carrefour e KFC, for buying from Sinar Mas and urged them to suspend dealings with the company.

Tesco sells 80 types of paper products made by APP, including Tesco-branded sketch pads, writing paper and cards. Tesco has continued to buy paper products from APP after Sainsbury's and Marks & Spencer cancelled contracts because of the company's environmental record. After being contacted by The Times, Tesco said it would stop selling ownbranded products containing materials from APP by the end of this year.

According to the Financial Times, Auchan admitted to buy from APP but it would study to carefully to decide what action to take, while Carrefour has decided to stop production in Indonesia of APP supplies for Carrefour-branded products from this summer. Carrefour has had a number of meetings with APP to discuss other supplies, she said.

Indonesia signed a $1 billion deal with Norway in May that imposes a two-year moratorium on new permits to clear virgin forest and peatland, in order to reduce emissions from deforestation.