![\"\"](\"https:\/\/i0.wp.com\/gapki.id\/en\/allies-en\/uploads\/2023\/02\/palmoil_thai-german-cooperation.info_.png?resize=918%2C524&ssl=1\")
<\/a><\/p>\nPalm oil is one of the most popular and least expensive plant-based oils in the world. It is used across the globe for a wide range of packaged food products, ranging from cooking oil and baked goods to confectionary, sweets and snacks. Palm oil also finds use globally in the production of animal feed, soaps, detergents, cosmetics and biofuels. Indonesia and Malaysia are the leading global producers of palm oil, contributing more than 80% of global output. Nigeria, Thailand, Colombia, C\u00f4te d\u2019Ivoire, Cameroon, Guatemala, Honduras and Papua New Guinea contribute to the remaining share.<\/p>\n
Since the first quarter of 2022, palm oil prices have spiked due to the resurgence in domestic demand in Indonesia, the single-largest global producer. As a locally produced and economical cooking oil, Indonesians also widely utilize palm oil. Following the ease of Covid-19 restrictions, domestic on-premise and retail demand for cooking oil surged. Moreover, biofuel production using palm oil has surged in recent years, spurred by government subsidies.<\/p>\n
Concurrently, the confluence of climate change, Covid-19 and the Russia\u2013Ukraine conflict disrupted the global supply of edible oils, such as sunflower oil, soybean oil and rapeseed oil. This catalyzed international demand for alternatives, including palm oil, thereby escalating the international prices of the commodity. Though the Indonesian Government restricted exports to keep domestic palm oil prices at bay, the bans were soon recalled as domestic inventories piled up and global food inflation skyrocketed in 2022.<\/p>\n
However, the palm oil industry in these countries has been under fire due to reports that palm plantations encroach into forest land, which is the habitat of endangered wildlife species. In January 2023, the EU Parliament proposed to hold individual businesses responsible for ensuring that products shipped to the EU are not linked to deforestation. The law applies to all overseas commodity exporters, ranging from cocoa suppliers in West Africa to palm oil suppliers in Southeast Asia.<\/p>\n
The EU bloc is one of the biggest consumers of palm oil products. Consequently, the EU Parliament\u2019s new traceability and due diligence norms will translate into widespread labor loss and cost escalation for palm oil farmers and traders, particularly in Indonesia and Malaysia. \u00a0Small-scale farmers will struggle to comply with the sustainability law and obtain certifications. Large palm oil exporters and traders also face procurement challenges due to the varying harvesting standards and farming methods across regions. The added costs of compliance and certification will eventually be passed on to the end consumers in the EU, thereby sapping the price advantage of palm oil over other vegetable oils.<\/p>\n
While the US and UK Governments also passed similar regulations in 2021 to curb the cultivation of commodities that catalyze illegal deforestation, the EU\u2019s law is more hard-hitting. Food applications of palm oil and soybean oil in the EU bloc are thereby expected to decrease through the decade, thereby generating opportunities for other vegetable oils, such as rapeseed oil and sunflower oil. Consequently, GlobalData projects that the global edible oil market will expand by about 9% value CAGR over 2022-2026, outpaced by the value sales growth of the sunflower oil segment. Over and above this, the EU\u2019s Renewable Energy Directive II of 2022 proposed to gradually phase out palm and soybean oil-based biofuels by the year 2030 due to their link to forest degradation.<\/p>\n
Unsurprisingly, the EU Parliament\u2019s proposal for deforestation-free palm oil has attracted strong protests from the Indonesian Government and the local trade organisation, the Indonesian Palm Oil Association (GAPKI), who perceive it as discrimination of Western economies against key trade partners in The Association of Southeast Asian Nations (ASEAN). Late last year, the Council of Palm Oil Producing Countries (CPOPC) also called for an international standard for deforestation and the international acceptance of the Malaysian Sustainable Palm Oil certification scheme to help suppliers comply with the new sustainability laws. In the long term, producers are expected to conform to the new sustainability regulations and focus on premium-certified palm oil.<\/p>\n
Notably, the CPOPC anticipates the implementation of the EU Parliament\u2019s proposal to be postponed in light of the global cost of living crisis. (*)<\/p>\n
Source: retail-insight-network.com<\/a><\/em><\/p>\n","protected":false},"excerpt":{"rendered":"The authorities and local trade organizations in major palm oil-producing countries have voiced opposition to the EU Parliament\u2019s newly proposed due-diligence requirements to ensure deforestation-free commodity supply chains. The stringent sustainability credentials law will have a debilitating impact on palm oil exporters, particularly in Indonesia and Malaysia.<\/p>\n","protected":false},"author":1,"featured_media":22622,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"neve_meta_sidebar":"","neve_meta_container":"","neve_meta_enable_content_width":"","neve_meta_content_width":0,"neve_meta_title_alignment":"","neve_meta_author_avatar":"","neve_post_elements_order":"","neve_meta_disable_header":"","neve_meta_disable_footer":"","neve_meta_disable_title":"","neve_meta_reading_time":"","_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_feature_clip_id":0,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2},"jetpack_post_was_ever_published":false},"categories":[3708,3709],"tags":[],"class_list":["post-22621","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-publication","category-recent-news"],"yoast_head":"\n
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The announcement was made after a meeting last week between Airlangga Hartarto, Indonesia\u2019s coordinating minister for economic affairs, and Malaysia\u2019s\u2026","rel":"","context":"In "Publication"","block_context":{"text":"Publication","link":"https:\/\/gapki.id\/en\/news\/category\/publication\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2021\/11\/RI_Malaysia_palmoil_unite_astra-agro.co_.id_.jpg?fit=1200%2C618&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2021\/11\/RI_Malaysia_palmoil_unite_astra-agro.co_.id_.jpg?fit=1200%2C618&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2021\/11\/RI_Malaysia_palmoil_unite_astra-agro.co_.id_.jpg?fit=1200%2C618&ssl=1&resize=525%2C300 1.5x, https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2021\/11\/RI_Malaysia_palmoil_unite_astra-agro.co_.id_.jpg?fit=1200%2C618&ssl=1&resize=700%2C400 2x, https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2021\/11\/RI_Malaysia_palmoil_unite_astra-agro.co_.id_.jpg?fit=1200%2C618&ssl=1&resize=1050%2C600 3x"},"classes":[]},{"id":26327,"url":"https:\/\/gapki.id\/en\/news\/2023\/06\/05\/ri-malaysia-stall-trade-talks-with-eu-due-to-palm-oil-row\/","url_meta":{"origin":22621,"position":2},"title":"RI, Malaysia Stall Trade Talks with EU Due To Palm Oil Row","author":"admin","date":"June 5, 2023","format":false,"excerpt":"BRUSSELS - Indonesia and Malaysia have said they will delay trade talks with the EU while they seek fairer treatment for small palm oil producers hit by the bloc\u2019s \u201cpunitive\u201d new rules to prevent deforestation. Dato\u2019 Sri Haji Fadillah bin Haji Yusof, deputy prime minister of Malaysia, told the Financial\u2026","rel":"","context":"In "Publication"","block_context":{"text":"Publication","link":"https:\/\/gapki.id\/en\/news\/category\/publication\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2023\/06\/gapki_mangrove_2x.jpeg?fit=1200%2C800&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2023\/06\/gapki_mangrove_2x.jpeg?fit=1200%2C800&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2023\/06\/gapki_mangrove_2x.jpeg?fit=1200%2C800&ssl=1&resize=525%2C300 1.5x, https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2023\/06\/gapki_mangrove_2x.jpeg?fit=1200%2C800&ssl=1&resize=700%2C400 2x, https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2023\/06\/gapki_mangrove_2x.jpeg?fit=1200%2C800&ssl=1&resize=1050%2C600 3x"},"classes":[]},{"id":26315,"url":"https:\/\/gapki.id\/en\/news\/2023\/05\/22\/ri-asks-importers-to-pay-premium-for-sustainable-palm-oil\/","url_meta":{"origin":22621,"position":3},"title":"RI Asks Importers To Pay Premium for Sustainable Palm Oil","author":"admin","date":"May 22, 2023","format":false,"excerpt":"KUALA LUMPUR - Indonesia, the world\u2019s 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\u2026","rel":"","context":"In "Publication"","block_context":{"text":"Publication","link":"https:\/\/gapki.id\/en\/news\/category\/publication\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/gapki.id\/en\/allies-en\/uploads\/2023\/03\/palmoil_pharmanord.dk_.png?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/gapki.id\/en\/allies-en\/uploads\/2023\/03\/palmoil_pharmanord.dk_.png?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/gapki.id\/en\/allies-en\/uploads\/2023\/03\/palmoil_pharmanord.dk_.png?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/gapki.id\/en\/allies-en\/uploads\/2023\/03\/palmoil_pharmanord.dk_.png?resize=700%2C400&ssl=1 2x"},"classes":[]},{"id":28019,"url":"https:\/\/gapki.id\/en\/news\/2024\/06\/16\/opinion-without-dialogs-eu-risks-eudr-not-working-in-southeast-asia\/","url_meta":{"origin":22621,"position":4},"title":"OPINION: Without Dialogs, EU Risks EUDR Not Working In Southeast Asia","author":"admin","date":"June 16, 2024","format":false,"excerpt":"The European Union\u2019s palm oil ban is well underway, and Indonesia and Malaysia are taking action to protect their global palm oil exports,\u00a0filing complaints to the World Trade Organization (WTO). Though pivoting toward a sustainable future, Indonesia and Malaysia cannot phase out palm oil production until they further develop their\u2026","rel":"","context":"In "Publication"","block_context":{"text":"Publication","link":"https:\/\/gapki.id\/en\/news\/category\/publication\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2024\/06\/car_mobil_sawit_thediplomat.com_.jpg?fit=732%2C463&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2024\/06\/car_mobil_sawit_thediplomat.com_.jpg?fit=732%2C463&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2024\/06\/car_mobil_sawit_thediplomat.com_.jpg?fit=732%2C463&ssl=1&resize=525%2C300 1.5x, https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2024\/06\/car_mobil_sawit_thediplomat.com_.jpg?fit=732%2C463&ssl=1&resize=700%2C400 2x"},"classes":[]},{"id":26074,"url":"https:\/\/gapki.id\/en\/news\/2021\/08\/02\/wto-agrees-to-review-eus-anti-palm-oil-policy\/","url_meta":{"origin":22621,"position":5},"title":"WTO Agrees To Review EU\u2019s Anti-Palm Oil Policy","author":"admin","date":"August 2, 2021","format":false,"excerpt":"GENEVA -- The World Trade Organization (WTO) has agreed to a request from Kuala Lumpur to establish a panel examining a European Union (EU) law that restricts the use of palm oil-based biofuels. Under the EU\u2019s renewable energy directive (RED), palm oil-based fuels are to be phased out by 2030,\u2026","rel":"","context":"In "Publication"","block_context":{"text":"Publication","link":"https:\/\/gapki.id\/en\/news\/category\/publication\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2021\/08\/wto_palmoil_malaymail.com_.jpg?fit=988%2C564&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2021\/08\/wto_palmoil_malaymail.com_.jpg?fit=988%2C564&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2021\/08\/wto_palmoil_malaymail.com_.jpg?fit=988%2C564&ssl=1&resize=525%2C300 1.5x, https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2021\/08\/wto_palmoil_malaymail.com_.jpg?fit=988%2C564&ssl=1&resize=700%2C400 2x"},"classes":[]}],"jetpack_sharing_enabled":true,"jetpack_likes_enabled":true,"jetpack_featured_media_url":"https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2023\/02\/palmoil_thai-german-cooperation.info_.png?fit=918%2C524&ssl=1","_links":{"self":[{"href":"https:\/\/gapki.id\/en\/wp-json\/wp\/v2\/posts\/22621","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/gapki.id\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/gapki.id\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/gapki.id\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/gapki.id\/en\/wp-json\/wp\/v2\/comments?post=22621"}],"version-history":[{"count":0,"href":"https:\/\/gapki.id\/en\/wp-json\/wp\/v2\/posts\/22621\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/gapki.id\/en\/wp-json\/wp\/v2\/media\/22622"}],"wp:attachment":[{"href":"https:\/\/gapki.id\/en\/wp-json\/wp\/v2\/media?parent=22621"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/gapki.id\/en\/wp-json\/wp\/v2\/categories?post=22621"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/gapki.id\/en\/wp-json\/wp\/v2\/tags?post=22621"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
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