Malaysia, Indonesia in united stand to promote palm oil

18/11/2010 (The Star Online), Brussels - In a united stand, the world's top palm oil producers Malaysia and Indonesia have expressed strong intention to undertake more joint activity to promote the commodity's sustainable production image and address the mounting negative publicity among the green NGOs and major importing Western countries.

One such move was the recently-concluded two-day Joint Malaysia-Indonesia Ministerial Mission to the European Union (EU) which started on Monday with the aim of addressing concerns on the EU Renewable Energy Directive (RED) set to be implemented by Dec 5.

Malaysia's Plantation Industries and Commodities Minister Tan Sri Bernard Dompok and Indonesia's Agriculture Vice-Minister Dr Bayu Krisnamurthi said in a joint press conference on Tuesday that there were positive outcomes from the meetings with the European Commissioners on issues related to palm oil.

The issues discussed at the closed door meetings include Directive 2009/28/EC on the promotion of the use of energy from renewable sources and its WTO-compliance, sustainable production of palm oil, indirect land use change (ILUC), biofuel certification, revision of the default values under Annex V of the RED and high-biodiversity grassland.

Dompok said: The European Commissioners had indicated that they were open and willing to review the EU RED criteria on palm oil if Malaysia and Indonesia were able to provide more inputs in the form of data and proven research findings to support the merits of the commodity.

The EU RED has set criteria on the use of palm oil as feedstock for biofuel production which could form a non-tariff barrier for the import of the commodity into the EU.

As top palm oil producers, Malaysia and Indonesia had attracted the most scrutiny whereby politicians from all sides had been influenced by NGOs and are currently promoting discriminatory trade measures against palm oil as part of the implementation of the EU RED.

For decades, Malaysia has been meeting the European demand for quality vegetable oil for use in food and oleochemical products, Dompok said.

However, within the past one to two years, Europe's new focus on fighting climate change and promoting alternative fuels has fundamentally shifted the political and commercial context for imports of palm oil and other vegetable oils with high potential for biofuel applications.

According to Malaysian Palm Oil Board statistics, Belgium had last year imported 1.24 million tonnes of palm oil, followed by the Netherlands at 989,834 tonnes and Britain at 42,293 tonnes respectively.

On the sustainable production of palm oil, apart from participating in the voluntary Roundtable on Sustainable Palm Oil (RSPO) certification, both countries are undertaking new efforts in ensuring sustainable production.

Bayu said: Indonesia is developing its own standard the Indonesia Roundtable on Sustainable Palm Oil (ISPO) and this will be made compulsory to all its plantation companies by early next year.

Dompok said Malaysia was implementing the codes of practice for the local palm oil sector.

Malaysia and Indonesia are striving for support from 10 to 15 other palm oil-producing countries in an effort to get a stronger voice in championing the palm oil cause.

Given the fact that there were no single certification on biofuels currently recognised by the European Commission, the ministers had proposed the implementation of a single EU certification scheme and the requirements of such schemes should be in line with the EU RED.

Next on the agenda for Dompok under his tight palm oil and timber programme will be London.

There will be a dialogue session with the NGOs which many consider as the major highlight of his working trip to London to be followed by a roundtable discussion with Britain's timber representatives and retailers' dialogue.

Palm Oil Production