Asia Palm oil industry needs a complete change of direction: Expert

Palm oil industry needs a complete change of direction: Expert

The EU has threatened to ban palm oil used in biofuels, targeting both Malaysian and Indonesian producers

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Kuala Lumpur — Palm oil producers should examine their entire businesses model to stop their impact on climate change, according to Mr Darrel Webber, Chief Executive Officer of the Roundtable on Sustainable Palm Oil (RSPO),

He said on Tuesday (Jan 14) that palm producers had to move on from just trying to protect forests and boosting yields. Their aim should be to fix their entire supply chain and business to achieve a greater aim in environment preservation.

“People will question why you are using any fossil fuels in your operations,” said Mr Webber.

“Climate change issues have been there a long time but there is a greater sense of urgency,” he said.

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“It is almost guaranteed that this sense of urgency will be ramped up in the coming years,” he said to the Thomson Reuters Foundation in an interview days before his retirement from the palm oil group.

The European Union is in a tussle with palm oil producers over deforestation and the periodic thick smog over parts of South-east Asia. Forest fires in Indonesia are partly blamed on palm oil plantations, causing severe environmental issues across South-east Asia.

The Europeans are also worried about the effects of palm oil on European companies involved in the making of biofuels. In December 2018, the French parliament voted to remove palm oil from the country’s biofuel scheme starting in January this year.

The EU has threatened to ban palm oil used in biofuels, targeting both Malaysian and Indonesian producers. Malaysia and Indonesia have said they will jointly fight any EU ban through the World Trade Organisation (WTO).

On June 10 last year, the EU Parliament passed a law to restrict and ban palm oil biofuel altogether by 2030. The law targets oil palm producing companies in South-east Asia, Africa and Latin America.

In response to the enactment of the law, Indonesian President Joko Widodo said the EU had provoked a “trade war”.

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