Indonesia and Malaysia, which account for around 85 per cent of global palm oil production, have accused the European Union of unfairly targeting the controversial product to impose limits on levels of contaminants.
The bloc is looking to set harsher limits on food contaminants in refined oils and fats, including palm oil, that can harm the kidneys and male fertility. Palm oil is already facing restrictions on its use as a biofuel in transport in Europe.
During 2019, the European Commission, the EU’s executive branch, last year stated that palm oil caused excessive deforestation and should be phased out as a biofuel between 2023 and 2030. The wider palm oil sector contributes around 3.5 per cent to Indonesian GDP and sustains an estimated 6 per cent of the population. The Indonesian government in 2018 earned US$17.8 billion from exports of the oil.
“The EU is raising a trade barrier by trying to formulate an even higher standard. We cannot let this happen,” said Indonesia’s economy minister, Airlangga Hartarto, at a palm oil forum in Jakarta.
Brussels has already imposed a limit on the contaminant glycidyl esters and is expected to soon target 3-monochloropropane diol (3-MCPD). The contaminants can form when cooking oils are being refined. The Council of Palm Oil Producing Countries (CPOPC), which is dominated by Indonesia and Malaysia, also questioned the new EU limits, which will be tougher than those imposed elsewhere.
“They put two levels, one for their oils, one for our oils. In other words, discriminatory,” said Yusof Basiron, an executive director of CPOPC.
He said the lobby group wanted palm oil to have the same safety limit of 3-MCPD as other cooking oils. Last month India imposed restrictions on imports of refined palm oil from Malaysia in response to Prime Minister Mahathir Mohamad’s criticism of Indian action in Kashmir and the new anti-Muslim citizenship law.
Now Malaysia is looking to secure at least half of Pakistan’s considerable palm oil market, according to Teresa Kok, Malaysia’s primary industries minister. Malaysia currently supplies approximately 22 per cent of palm oil to Pakistan’s 200-million-strong population.
“The country’s population growth is an opportunity for us. There is certainly room for improvement and the recent announcement by Prime Minister Imran Khan [to buy more palm oil] is good news to us,” Kok told the media.
Khan, who visited Malaysia this week, said Pakistan would try to fill Malaysia’s shortfall in palm oil exports to India.
“We noticed that India has threatened Malaysia for supporting the Kashmir cause. Pakistan will try its best to compensate,” the cricket legend turned politician said.