Details

Last Updated: 27 December 2022

Hits: 1911

MEDIA STATEMENT
EU REGULATION ON DEFORESTATION-FREE PRODUCTS : A DELIBERATE
ACT TO BLOCK MARKET ACCESS

On 6th December 2022, The EU Council and Parliament reached a provisional deal on a proposal to minimise the risk of deforestation and forest degradation associated with products that are imported into or exported from the European Union.

As a producing and trading country, Malaysia is deeply concerned over the developments of the EU Deforestation-Free Products Regulation, targeting commodities including palm oil, timber, cocoa, and rubber. This unilateral initiative is detrimental to free and fair trade, and could result in adverse impacts on global supply chain. Some aspects of the risk-assessment process of the Regulation are counterproductive to commitments to curb global deforestation and run the risk of disincentivizing producing countries.

Malaysia underscores the need for a balanced approach between achieving development goals and climate ambition. The 2030 SDGs remain the utmost priority for Malaysia. We have embarked on sustainability initiatives including national certification schemes, such as the Malaysian Sustainable Palm Oil (MSPO) certification scheme, Malaysian Timber Certification Scheme (MTCS) and Sustainable Forest Management (SFM) practices, with a view to facilitating access into the EU Single Market.

The Regulation will place additional burdens on Malaysian palm oil exporters to the EU market, specifically additional traceability requirements and data that must be provided to end-customers based in the EU. Countries will be ranked as ‘high risk’, ‘standard risk’ or ‘low risk’ and restrictions on commodities will be either more or less stringent, based on this ranking.

The Deforestation-Free Products Regulation is a deliberate act by Europe to block market access, hurt small farmers and protect a domestic oilseeds market that is inefficient and cannot compete with the cost of palm oil. Moreover, this Regulation could lead to higher food prices and reduced output at a time of record global inflation.

Europe’s justifications for promoting this Regulation is based on unsound reasoning and has a weak scientific basis. Malaysian palm oil is sustainable, and is one of the most certified vegetable oils in the world today. The Malaysian Sustainable Palm Oil (MSPO) standard already guarantees Malaysia’s commitment to comprehensive sustainability standards. Malaysia will continue to provide sustainable and deforestation-free palm oil to our European and global customers. There is no need to add further costs and burdens.

It would be offensive to Malaysia if either palm oil, or the country, is designated high risk by the EU Regulation. There is no justification for it .

Unnecessary regulations on palm oil exacerbate the food supply crisis, increase costs of food, increase energy costs and harm both the European and Malaysian economy and undermines our poverty alleviation efforts. The EU must commit to genuine engagement with producing countries.

Malaysia values the EU as one of our important trading and investment partners. We stand ready to further enhance this mutually-beneficial partnership, especially building on the recent signing of the Malaysia-EU Partnership and Cooperation Agreement (PCA) as well as possible resumption of Malaysia-EU Free Trade Agreement (FTA) negotiations.

YAB DATO’ SRI HAJI FADILLAH BIN HAJI YUSOF
DEPUTY PRIME MINISTER AND MINISTER OF PLANTATION
AND COMMODITIES
23rd DECEMBER 2022

Details

Last Updated: 12 May 2022

Hits: 613

MEDIA STATEMENT
ADVANCING AGRICOMMODITY SECTOR IN A SUSTAINABLE
ECOSYSTEM AT MALAYSIA INTERNATIONAL AGRICOMMODITY
EXPO AND SUMMIT (MIACES)
_____________________________________________________________________________________

1. Minister of Plantation Industries and Commodities, YB Datuk Hajah Zuraida Kamaruddin, officiated the soft launch of the Malaysia International Agricommodity Expo and Summit 2022 (MIACES 2022) held at Malaysia International Trade and Exhibition Centre (MITEC) Kuala Lumpur today.

2. MIACES 2022 could not have been organized at a better time as the anticipated openings for the Agricommodity sector to further flourish in the global market. It will be the premier event in the calendar of Agricommodity and primary industries internationally, scheduled to be held from 26-28 July this year at MITEC.

3. Organized by the Ministry of Plantation, Industries, and Commodities (MPIC) and anchored by the Malaysian Rubber Council (MRC), Malaysian Palm Oil Council (MPOC) and Malaysian Timber Council (MTC), MIACES 2022 is expected to create opportunities to expand to new markets for Agricommodity exports.

4. The event comprises three days expo, summit, ministerial roundtable, and award night to appreciate the industry practitioners putting their efforts in uplifting the industries. It will showcase 250 companies, 500 trade delegates, 10,000 visitors to attend this three-day event, and MOUs are anticipated to be signed and witnessed by our distinguished dignitaries locally and internationally. It will also showcase the latest equipment, machinery, and technology.

5. The Ministry believes that agricommodity sector could grow into a stronger economic contributor by increasing agricommodity industry players, producers, investors, stakeholders and advancing sustainable primary production here in Malaysia. MPIC intends to grow a cluster of large agricommodity firms that can take on the world and build on Malaysia’s agricommodity strength.

MINISTRY OF PLANTATION INDUSTRIES AND COMMODITIES
23 March 2022

Details

Last Updated: 21 June 2022

Hits: 604

MEDIA RELEASE
KEYNOTE ADDRESS OF MINISTER OF PLANTATION INDUSTRIES AND
COMMODITIES AT THE MALAYSIAN-BRITISH PARTNERSHIP FORUM,
“65 YEARS AND BEYOND” AT THE CALEDONIAN CLUB, LONDON

1. The UK and Malaysia have enjoyed 65 years of diplomatic relations since the Federation of Malaya’s independence in 1957. This year also marked the 70th year of Her Majesty Queen Elizabeth II acceded to the throne of the British monarch. As we are all aware, Her Majesty The Queen is the first British monarch to celebrate a Platinum Jubilee, marking 70 years of service to the people of the United Kingdom, the Realms and the Commonwealth.

2. Our partnership is founded firmly on common values :

• Respect for the independence, sovereignty and territorial integrity of all nations
• Mutual respect and benefit
• A commitment to rules-based trade and to low-carbon development to tackle
climate change
• Respect and promotion of the rule of law and human rights
• Advancement of international law and multilateralism and the promotion of
peace, security and prosperity in line with the United Nations and
Commonwealth Charters

3. The UK is Malaysia 19th largest trading partner. In 2021, the total trade of goods and services for both countries accounted for £5.2 billion. Malaysian export of agricultural commodities (Palm Oil, Rubber, Timber, Cocoa and Pepper) contributed to 14% of the total trade, valued at £734 million. This agriculture trade export has shown an increase of 17% compared to 2020, which is £628 million.

4. As the UK has shown interest in ensuring that agricultural commodities entering the UK are sustainably sourced, Malaysia has been working closely with the UK to ensure that the voice of producing countries like Malaysia are heard and any new laws to be enacted that may affect the trade exchanges are in line with the spirit of the United Nations Sustainable Development Goals (UNSDG) as a whole – economically, socially and environmentally.

5. We also showed our support during UK’s Presidency of the 26th Conference of Parties (COP 26) last year and contributed to the Glasgow Declaration on Forests and Land used. In relation to that, we are committed to strengthening our cooperation through the Forest, Agriculture and Commodities Trade Dialogue (FACT Dialogue) where we were tasked as the co-facilitators for the Smallholder Support Working Group. Malaysia’s Sustainability Efforts in Commodities

6. Sustainability has always been the central theme of Malaysia’s economic policy direction throughout the years from the National Economic Policy (NEP) in the 1970s, New Economic Model (NEM) in 2009, Vision 2020 and the latest Shared Prosperity Vision 2030.

7. Sustainability has always been associated with deforestation. However, it is crucial to note that sustainability is more than just forests. The United Nations'definition of sustainability is clear: social and economic sustainability is on an equal plane with environmental. So, the Malaysian Government is also focused on supporting small farmers and their economic communities. Among the initiatives includes developing infrastructure, granting financial assistance where needed, and protecting the ability of small farmers to earn a living.

8. Our sustainability practices recognises how these issues are interconnected and requires a systematic approach. MPIC stands guided by the action plans of the UNSDGs blueprint, particularly on:

• Goal 1 (No Poverty)
• Goal 2 (Zero Hunger)
• Goal 8 (Decent Work and Economic Growth)
• Goal 9 (Industry, Innovation and Infrastructure)
• Goal 12 (Responsible Consumption and Production)
• Goal 15 (Life on Land)
• Goal 17 (Partnerships to achieve the Goal)

9. Taking an example from the palm oil industry, I want to stress that the Malaysian palm oil industry now focuses on improving productivity and yields rather than expanding land for cultivation. Forest protection is a priority for our government. Malaysia also assures the world that it will not retreat from its 1992 Earth Summit pledge on sustainable development – it will keep at least 50% of its total land area under permanent forest. Malaysia has also committed to plant '1 million forest trees species within the next ten (10) years'.

10.Another important measure taken by the Malaysian Government through the Ministry of Plantation Industries and Commodities (MPIC) is the introduction of the Malaysian Sustainable Palm Oil Certification (MSPO) in 2015, which was made mandatory starting from January 2020. The MSPO Certification Scheme ensures that Malaysian palm oil is sustainably produced and safe for consumption. It also seeks to reduce the industry's social and environmental impacts and help independent smallholders certify their palm oil for the export market. In addition, the certification ensures the country's palm oil industry complies with international sustainability requirements encompassing the whole supply chain, from growers and millers to traders and retailers.

11.MPIC through the National Agri-commodity’s Strategic Plan is also committed to ensure that other commodities will have their own certification systems in the future. Circular Economy

12.Integrating a circular economy into the production of Agri-commodities, particularly palm oil, is an effective solution to optimise the usage of resources (raw materials) and minimise wastage from production, emissions and energy inefficiency.

13.This is done by reducing, reusing and recycling materials commonly underutilised in the current linear economy. The model adopts a circular pathway which utilises usable materials after the first processing cycle by reintroducing it back into the second processing cycle of similar or different products as secondary raw materials. Ultimately, this process will translate into optimising raw materials by continually adding value to its users along the supply chain.

14.Production of palm oil results in multiple types of secondary products (solid and liquid) in high volumes, such as Palm Oil Mill Effluent (POME), Empty Fruit Bunch (EFB), decanter cake and palm pressed fibres. These biomass products can be further utilised directly to produce new value-added products or as alternative energy sources to fuel the production facility.

15.The incorporation of this model will not only address the environmental aspect plaguing the palm oil industry but also the economic concern of the supplies of primary raw materials. MPIC is also planning to expend the circular economy technology to other Agri-commodities such as rubber, pepper and Kenaf to ensure a more effective and sustainable waste management.

16.As the industry embarks on reusing its waste, the reliance on primary sources will diminish. This contributes to reducing deforestation and lowering our carbon footprint. Introducing new usages of secondary products will also bring about new economic opportunities. Furthermore, it could significantly disrupt the current energy industry by increasing the accessibility to biomass as an energy alternative, in tandem with the world's commitment to decarbonising its economy by reducing its reliance on fossil fuels.

17.I wish to highlight that Malaysia has been at the forefront of promoting palm oil and palm biomass in the manufacturing sector. The National Biomass Strategy 2020 (NBS2020) set a target to turn palm biomass into higher-value products that will create an incremental gross national income (GNI) of £5.5 billion (RM30 billion) and 66,000 new jobs while attracting £4.6 billion (RM25 billion) in investment and reducing carbon emissions by 12%.

18.The circular economy model is undoubtedly the way forward for Malaysia’s Agri-commodity sustainable and ethical sourcing. Despite the challenges of integrating, it into the current linear model, the focus would be to create more value. There is much value extracted from reusing and recycling these raw materials.

CLOSING REMARKS : Malaysia – UK Partnership Opportunities

19.Malaysia opens its doors to work with international parties including government agencies, academicians, research institutes, industry players and businesses to ensure the Agri-commodity industry continues to develop progressively and sustainably.

20..Looking at sustainability and circular economy, we realise that we have to work with many stakeholders and potential tech players to harness the latest technology to further explore the full potential of Agri-commodities production. There is a need for better facilities, more advanced technologies and substantial investments into the industry to ensure a competitive edge against
traditional practices.

21.I hope this forum can further look into the possible opportunities for partnerships between our countries and strengthening both countries' national economic agendas.

22.On that note, I wish all delegates and participants of the Malaysia – British Partnership Forum a fruitful discussion. *The keynote address was delivered during the Malaysian British Partnership, “65 Years and Beyond” held at The Coledonian Club, 9 Halkin St, London on 17th May 2022

YB DATUK HAJAH ZURAIDA KAMARUDDIN
MINISTER OF PLANTATION INDUSTRIES AND COMMODITIES
25 MAY 2022

Details

Last Updated: 24 May 2022

Hits: 414

FUTURE-PROOFING PALM OIL FROM ADVERSE WESTERN PROPAGANDA

THE notoriety of developed economies against palm oil – the most produced, consumed and traded edible oil – all in favour of protecting the soybean trade (the second most-produced edible oil) is well-known. The European Union (EU) Parliament has voted for palm oil-based biofuels to be banned entirely by 2021. In contrast, other crop-based biofuels will be capped at 7%
and enjoy a gradual reduction to 3.8% by 2030.

Such a ban is linked to the EU’s belief that oil palm cultivation is responsible for deforestation. Another trade ban that has often affected Malaysian palm oil export is the US Customs and Border Protection (CBP), curtailing palm oil import into the world’s largest economy based on forced labour allegations. In the EU case, palm oil exports into the continent face numerous hurdles even with Asian palm oil exporters voluntarily abiding by the sustainable certification ruling under the Roundtable on Sustainable Palm Oil (RSPO) scheme.

In fact, putting in place mandatory sustainability requirements is not an issue for exporters, given that sustainable volumes will receive a market price premium. However, the EU’s failure or hesitance to recognise the national sustainability standards in Malaysia (the MSPO or Malaysian Sustainable Palm Oil standard) and Indonesia (the ISPO or Indonesian Sustainable Palm Oil standard) is a severe worry for both top two global palm oil producers. This is ironic, considering Europe only represents 6.4% of the global palm oil market. Yet, the cartel-like RSPO endeavours to apply pressure from consumers in affluent Western markets on Asian palm oil producers.

To re-cap, Indonesia was the first to initiate its national certification scheme (the ISPO) in 2011, with Malaysia following suit four years later (with the MSPO). Since then, both countries have been campaigning globally to win recognition of their standards and the right to define sustainable palm oil on their own terms. Uneven turf Unfair attacks and new allegations continue to discredit and pursue the industry's downfall amid existing legislation and certification standards to ensure labour rights are protected or the very fact that oil palm cultivation occupies only 0.31% of the global 5 billion hectares of agricultural land.

As highlighted by Gambian Centre for Sustainable Palm Oil Studies (CSPO) member Muhammed Magassy, it should come as no surprise if significant palm oil producers (like Malaysia and Indonesia) regard the EU’s anti-palm oil stance as “crop apartheid” given such behaviour re-animated the exploitative, colonial origins of the industry. While the EU biofuel ban is in place, it simultaneously evokes subtle protectionism by exempting European oilseed products such as rapeseed and sunflower, which require more land, water, and fertiliser than palm oil, from any economic penalty.

“We in Africa know this too well; the EU’s Common Agricultural Policy (CAP) provides domestic farmers €42 billion (RM196.2 bil) in annual subsidies, hence strengthening their ability to export at artificially low prices to the developing world,” argued Muhammed Magassy in “Green Trade War on Palm Oil” published by London-based The Parliament e-magazine. “This gives European producers an unfair advantage in markets such as Africa, bankrupting local farmers.”

Imagine such biasness is allowed to prevail even as palm oil also boasts numerous health benefits, which has led to the Malaysian Palm Oil Council (MPOC) unveiling the Malaysian Palm Oil Full of Goodness campaign to showcase the Malaysian Palm Oil industry’s sustainable initiatives and management. Dismantling barriers Denial of entry is already fuelling deep concerns among global industry players concerned that such a ruling may influence other major export destinations to follow suit. Of late, there has been a resurgence of anti-palm oil campaigns – even at the school level by associating the emergence of oil palm plantations with the disappearance of orang utans.

As mentioned earlier, such stigma surfaces even though there have been existing legislations to protect and prohibit the expansion of oil palm cultivation under existing conservation programmes. It just seems that no matter how many preventive measures are put in place, they are never enough. As much as Malaysia and neighbouring Indonesia, which are the world’s two largest palm oil producers, harbour no intention to make enemies, it is obviously high time for the palm oil industry to take a more proactive and aggressive stance to dispel baseless claims by powerful competitors who are out there to champion other types of edible vegetable oils.

It is time for all concerned certification bodies to come forward to defend palm oil, dispelling all the allegations. Slim chance or otherwise, Malaysia/Indonesia must proactively pursue their legal recourse filed with the World Trade Organization (WTO) against the EU’s restrictions on palm oil biodiesel. Truth must be told As highlighted by FGV Holdings Bhd’s group CEO Mohd Nazrul Izam Mansor at the Future-Proofed Palm Oil Summit (FPPO 2021) in November last year, the global agribusiness and food producer places a strong commitment to environmental, social
and governance (ESG) considerations in all its undertakings.

This is clearly embedded in the group’s sustainability policy where FGV has adopted the no deforestation, no planting on peat and no exploitation commitment. In its quest to conserve biodiversity and wildlife, the group has embarked on a new three-year initiative to protect and enhance high conservation value and high carbon stock areas within the vicinity of its plantations by planting fast growing indigenous or native tree species and wild fruit trees. “Wildlife protection and human-wildlife conflict management remain a high priority for FGV. One of our conservation projects involves the rescue, rehabilitation and release of injured or displaced Malayan Sun Bears,” he said in a special address at FPPO 2021.

“While this project is ongoing, we have expanded our Protection of Rare, Endangered and Threatened Species Programme to include pygmy elephants, gibbons and pangolins.” On the social component, FGV has been focusing on efforts in the past several years towards ensuring compliance to human rights and labour standards. These efforts have been intensified since early 2019 especially with our affiliation to the Fair Labour Association (FLA) which is a long-term programme to improve structures and systems for the enhancement of FGV’s labour practices.

Even then, it is worth noticing that FGV was slapped with a US CBP Withhold Release Order (WRO) on Sept 30 last year on allegations of forced labour. Nevertheless, FGV has appointed independent auditing firm Elevate Ltd expedite the auditing process which will eventually pave way to the lifting of the (WRO). FGV is not alone in such quandary as another Malaysian palm oil giant Sime Darby Plantation Bhd (Sime Plantation), too, is not spared from the WRO action. The world’s largest producer of Certified Sustainable Palm Oil (CSPO) is expected to deliver its impact report submission to the US CBP by end-April which will go towards the lifting of the WRO imposed on the company since December 2020.

Interestingly, Sime Plantation has recently revealed that it is transforming all its 33 Malaysian palm oil mills into certified food safety facilities by end-2023, after which the same standards will be rolled out across the group’s operations in Indonesia, Papua New Guinea and the Solomon Islands. On my part, I am seeking meetings with the US CBP and the EU by July this year to
set the record straight on forced labour allegations while once and for all, address the fallout from WROs issued by the US CPB to FGV Holdings and Sime Plantation in 2020.

On a similar note, Malaysia will be represented at the dispute proceeding on the EU’s alleged discrimination against the national palm oil industry from May 8 to 18 for us to provide our side of the story on the matter. I call on all Malaysians to work together with us to address the anti-palm oil propaganda by Western countries which is clearly aimed at bringing down our country's palm oil industry. I will ensure we put up an "aggressive" fight against these foreign pressures and provide them with all the relevant evidence. We will show them that Malaysia is not a
nation to be fooled around with.

Datuk Zuraida Kamaruddin is Malaysia’s Plantation Industries and
Commodities Minister.