Malaysian palm oil producers welcome expected delay in EUDR regulations

Palm oil producers in Malaysia have reportedly welcomed plans from the EU that would see a delay in implementing its much-publicised deforestation regulation policies that have met with fears in South East Asia and Latin America over elevated costs for farmers, reports Neill Barston.

An investigation from the Financial Times noted that European parliament officials had indicated that the new proposed EUDR legislation – which was due to come into force in December 2024, will now not see locations graded by apparent risk, enabling them greater time to meet compliance standards.

Under the terms of the legislation as it was originally put forward, countries would be bracketed into low, medium and high risk zones, but this, according to latest reports, is set to be watered down to initially band all nations under a ‘standard’ rating in order to allow them greater time to review their operations.

The EUDR regulations have been designed to ensure greater transparency within supply chains, centred on creating a standard that ensures that products  EU citizens consume are not contributing towards global deforestation. Furthermore, it also ties in respect for human rights within local producing populations as a core element of the legislation, which applies to major commodities including cocoa, coffee and rubber.

As observed by the Mypalmoilpolicy.com industry organisation, Malaysian prime minister, Anwar Ibrahim stated recently that “the EU should show some sort of appreciation, and at least give recognition to the efforts by Malaysia,” which comes as sector observers express concern that the South East Asian country’s hundreds of thousands of farmers would be negatively impacted by the burdens of EUDR regulation if additional requirements are put in place.

The prime minister’s sentiments were further backed by the country’s commodities minister, Johari Abdul Ghani, who cited a ruling by the WTO handed to the European Union, ruling that the trading bloc’s attempts to restrict Malaysian palm-oil-based biofuels, was in fact discriminatory.

According to Mypalmoilpolicy.com, Malaysia had in fact raised concerns over the EUDR regulations for almost two years in terms of its impact on farming. It asserted that the country’s exporters already have in place the tools to comply with strict deforestation criteria.

As part of this, the organisation cited The Malaysian Sustainable Palm Oil (MSPO) certification standard as guaranteeing no deforestation and good agricultural practices, which meant that the country was in a position to meet standards set in the EU, and anywhere else.

In addition, the body stated that a proposed delay in implementing the new EU legislation was a ‘welcome development’ given that in its view the ‘high risk’ label had no evidence base or clear processes set out. This was at odds with its own achievements on sustainability, which it observed had gained an internationally-accepted certification standard, and clear data demonstrating that deforestation was not considered as being within the high risk category.

However, the palm oil group stated that significant questions remained over the EUDR legislation including its requirement for traceability in supply chains – it claimed that the demand for small farmers to measure ‘polygons’ via “unworkable technology that violates privacy and interferes with the sovereignty of the state” was of concern.

On the latter point, Confectionery Production has reported on the introduction of geomapping systems within the cocoa sector in recent years, which have greatly enhanced traceability within cocoa supply chains – though support from the sector has been required in implementing these systems.

Tags: EU, Malaysia, palm oil, deforestation, EUDR