Indonesian palm oil giant Sinar Mas rejected claims of environmental vandalism on March 18 after Nestle, the world's biggest food company, dropped it as a supplier following protests by Greenpeace.

It was the second embarrassing blow to Sinar Mas in three months after Unilever severed ties with it in response to Greenpeace claims it is destroying rainforests.

Greenpeace activists held protests on March 17 at Nestle's headquarters and factories in Britain, Germany and the Netherlands, linking the company's Kit Kat confectionery to the destruction of orangutan habitats.

"Considering its size and influence, it should be setting an example for the industry and ensuring its palm oil is destruction free," Greenpeace said. "Instead, Nestle continues to buy from companies, like Sinar Mas, that are destroying Indonesia’s rainforests and peatlands."

Rampant deforestation in Indonesia makes it one of the biggest emitters of greenhouse gases in the world and threatens habitats of endangered species like orangutans, tigers and rhinos.

Nestle responded immediately to the protests, dropping Sinar Mas and repeating its commitment to using only Certified Sustainable Palm Oil by 2015, "when sufficient quantities should be available."

"Nestle has replaced the Indonesian company Sinar Mas as a supplier of palm oil with another supplier for further shipments," it said.

"We confirm that Nestle has only bought from Sinar Mas for manufacturing in Indonesia, and no palm oil bought from Sinar Mas has been used by Nestle for manufacturing in any other country."

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