"These allegations are not well founded and contain a number of factual inaccuracies," they said in a joint statement to the national Bernama news agency.
"The industry is far better regulated and the orangutan far better protected than is suggested in the report," they said, adding that the industry often preserved jungle reserves and wildlife sanctuaries as part of efforts to maintain the existing biodiversity found in plantations.
A recent survey showed that thousands of orangutans remained in and around the Kinabatangan Wildlife Sanctuary in east Sabah state on the island of Borneo, they added.
In a report that Friends of the Earth dubbed the "Oil for Ape Scandal," the environmental group said that wildlife centers in Indonesia were overrun with orphaned baby orangutans that had been rescued from forests being cleared to make way for new plantations.
"Almost 90 percent of the orangutan's habitat in Indonesia and Malaysia has now been destroyed. Some experts estimate that 5,000 orangutans perish as a result every year," it said.
"Oil palm plantations have now become the primary cause of the orangutan's decline, wiping out its rainforest home in Borneo and Sumatra."
Palm oil is found in one in 10 products on supermarket shelves, including bread, chips, cereals, lipstick and soap, it said.
The red-haired apes are found only on Borneo, which is shared by Malaysia, Indonesia and Brunei, and on the Indonesian island of Sumatra.
Their numbers have dwindled to less than 60,000 from a population that once spanned Southeast Asia.
As well as forest clearing, they are threatened by commercial logging, forest fires, hunting and poaching for the bush meat and pet trades.
Name: Orangutan (
Pongo pygmaeus)
Primary Classification: Hominidae (Chimpanzees, Gorillas, Orangutans and Humans)
Location: The islands of Borneo and Sumatra in Indonesia.
Habitat: Mature tropical rainforest.
Diet: Mainly fruits. Also other vegetation, lizards, termites, nestlings and eggs.
Size: Up to 4.5 ft in length and 175 lbs in weight.
Description: Reddish-brown in color; long, shaggy hair; very long arms; strong, grasping hands; heavy body; hand-like feet; males have large cheek pads, a hanging throat patch, a square-shaped face and a long beard and moustache.
Cool Facts: They spend almost their entire lives in treetops, males coming down occasionally to move between stands of trees. Mothers with young children build two to three nests a day — one in the evening and one or more during the day for resting and playing.
Conservation Status: Endangered
Major Threats: Habitat loss.
What Can I Do?: Visit
The Orangutan Network and
Orangutan Foundation International for information on how you can help.