JAKARTA – The Indonesian Palm Oil Association (GAPKI) is now seeking new export markets for palm oil products to compensate the potential reduction in European Union (EU) market which has been increasingly restricted following the application of EU deforestation-free regulation (EUDR).
GAPKI Chairman Eddy Martono said that the palm oil producers and the Indonesian government have been continually seeking new markets to export the palm oil products. The latest such seeking efforts were pursued in countries of Eastern Europe recently.
“We’re trying not to fully rely on the traditional markets. We’re seeking new markets, while keeping the traditional ones,” Eddy told Bisnis.com on Wednesday, 07 June 2023.
Eddy pointed out that the Indonesian government has long anticipated forest-related policies like the EUDR by, among others, applying the moratorium of palm oil licenses based on the presidential instruction (Inpres) No.8/2018 on the delay and evaluation of palm oil licenses and productivity increase of oil palm plantations.
According to Eddy, there has been no more licensing for new oil palm plantations since the application of the moratorium. “But it’s different case if there are farmers who converted their smallholding plantations, such as rubber, to oil palm. “It affected the oil palm companies as they also buy fresh fruit bunches (FFB) from the smallholders,” said Eddy.
The EUDR implementation requires due diligence for seven agricultural and forestry commodities, including palm oil. The due diligence requirement is aimed to prove that the commodities are free from deforestation before entering the EU market.
Indonesia is the world’s largest producer of palm oil, contributing 59% to the global market of palm oil. The world’s second largest producer of palm oil is Malaysia with a global market share of 25%. The other producing countries of palm oil command 16 percent.
“We as palm oil companies could not tackle the EUDR problem alone. We have to collaborate with the government, especially because the EUDR will also affect the oil palm smallholders,” said Eddy. (*)
Source: Bisnis.com
