KUALA LUMPUR – Indonesia, the world’s largest palm oil exporter, on Wednesday urged importing countries to recognize and pay the premium for sustainably produced palm oil rather than boycotting the widely used oil, whose production critics say has been linked to deforestation.
The European Union (EU) in April approved a deforestation law to block imports of palm oil, beef, soya and other commodities if they are linked to recent destruction of the world’s forests.
Indonesia’s Coordinating Minister for Economic Affairs Airlangga Hartarto said consumer countries were tightening entry requirements for palm oil.
“While trying to improve the environmental practices, we seek the cooperation of all the stakeholders to pay a premium for products that adopt sustainability practices,” Airlangga said at a ministerial meeting of the Council of Palm Oil Producing Countries (CPOPC).
Boycotting palm oil will not provide a long-term solution for the environment, he added.
Palm oil producers have in recent years said consumer goods companies do not buy enough sustainability-certified palm oil, undermining efforts to reward those who adopt greener practices and reduce deforestation.
Indonesia and Malaysia, the founding members of CPOPC, will send envoys to the EU at the end of May to discuss the impact of the bloc’s deforestation law on their palm oil sectors.
The envoy will aim to seek clarity on the traceability requirements of the EU regulation and urge the bloc to recognize palm oil sustainability certifications, Malaysia’s Commodities Minister Fadillah Yusof said.
Malaysia is committed to progressively raising the proportion of palm oil in biodiesel, said Fadillah, who is also the deputy prime minister.
The world’s largest palm oil producers, Indonesia and Malaysia, use the edible oil as blending for biodiesel, with Indonesia in February raising its mandate to a 35 percent palm oil mix and Malaysia maintaining its mandate at a 20 percent mix.
“Malaysia continues its commitment to the implementation of the biodiesel program, progressively incorporating increased biodiesel blending ratios,” Fadillah added.
Fadillah also stressed that the world’s two largest palm oil producers also comply with all the good practices on par with world standards. “We want to send a strong message that palm oil has actually contributed a lot, in particular in compliance with the United Nations’ Sustainable Development Goals – that is, to address the poverty issue, which is something that we have achieved.
“Whatever action taken by the EU without negotiation and without engaging with us will definitely impact the smallholders,” he said.
The joint mission will also look at other proposed legislations being deliberated by the EU, such as the Forced Labor Regulation, Green Claims Directive, and Renewable Energy Directive II which require the attention of stakeholders in the palm oil industry.
For the Malaysian market, the EU accounts for 9.4% of Malaysia’s export volume or 1.47 million tons of palm oil.
“It is a significant number with some companies having established refineries in Europe. Thus the EUDR, which can be considered as a trade barrier, will directly impact operations and businesses in the long run,” Fadillah said.
He said that both Malaysia and Indonesia hope that the EU would recognize the Malaysian Sustainable Palm Oil and Indonesian Sustainable Palm Oil standards.
The CPOPC also welcomed Honduras as its third full member into the organization. Honduras is the third-largest producer and exporter in Latin America, and eighth-largest globally, said Honduran Agriculture Minister Laura Suazo. (*)
Source: straitstimes.com/thevibes.com/Bernama
