FELDA, which harbours the largest population of oil palm smallholders in Malaysia, fully condemns the discriminatory act by the European Union (EU) to ban palm oil from entering its market.
This year, the EU Parliament has passed two resolutions – to impose a single certified sustainable palm oil (CSPO) scheme for Europe-bound palm oil exports after 2020 and to phase out palm oil from the EU biofuel programme by 2020.
The resolutions were passed on claims that palm oil producers have failed to achieve the United Nations Sustainable Development Goals (SDG), which includes responsible consumption, production and climate action.
However, the claims by the EU linking palm oil to climate change and deforestation is unfair and unjustified to Malaysian oil palm growers including smallholders, which are strong supporters of the United Nations SDG, says Felda chairman Tan Sri Shahrir Abdul Samad.
“Malaysia as one of the world’s largest palm oil producers, has over the years taken strong measures to sustainably manage its plantations,” he adds.
Shahrir points out that: “There are no more deforestation for the purpose of opening up new oil palm plantations with many ongoing programmes to protect and rehabilitate the habitats such as orang hutans in Sabah and Sarawak.
“Our government is also fully committed to maintain more than 50% of the country’s forest reserves.”
Another United Nations SDG effort by Malaysia is to make it mandatory for all its oil palm smallholders nationwide to be certified under the Malaysian Sustainable Palm Oil (MSPO) by 2020.
Hence, it is rather disappointing for Malaysia that the EU Parliament failed to recognise Malaysia’s efforts towards producing certified sustainable palm oil (CSPO) for the global market.
On the plight of Felda’s over 112,000 smallholders likely to be affected by the EU action, Shahrir says: “The income of our smallholders is heavily dependent on significant contribution by oil palm cultivation from planting to selling palm fruits.”
In fact, the smallholders’ income derived from oil palm crop is more than double compared with rubber crop.
According to Felda’s Annual Report 2016, the average smallholder’s income for oil palm is around RM3,173 per month from RM1,499 per month from rubber.
“This supports the importance of palm oil contribution to elevate smallholders from the poverty level as the selling price of palm fruits is higher than other crops which they have planted before.” .
Another point highlighted by Shahrir is on Malaysia’s certified timber exports to the EU, which is well accepted for its good forest management practices. About 70% of the local certified timber are exported to the EU annually.
“So, if the major concern by the EU is deforestation, then timber should be their first target and not palm oil,” questions Shahrir.
“It is ironic that the EU is willing to accept our timber, but at the same time, they also accused us for deforestation (in oil palm)?”
As for the second EU resolution to phase out palm oil based biofuel by 2021 compared with other crops fuel by 2030, Shahrir says this reflects the biasness of the EU in its effort to protect its own oilseeds crop.
“This is a dangerous game the EU is playing, it is very sneaky. The way they are going against palm oil biodiesel creates animosity and misinterpretation on palm oil.
“In the end, this will lead to a lot of damages to all other palm oil products as well given the damaging infos being fed into the consumers’ mind.”
Should the EU resolutions been forced, Shahrir says it could create spillovers to other countries given the negative palm oil image portrayed by the EU that will dampen the CPO prices.
In return, this scenario will weigh heavily on the income of the local smallholders.
One of Shahrir’s main concerns next year is the price of CPO, which could be dragged down if the resolutions are enforced by the EU.
“The CPO price will be affected should the resolutions are passed. The income of smallholders will go down thus ceating a big social impact on palm oil farmers.
“Big palm oil companies will have options to reinvest into something else should the resolutions be enforced.
For farmers, they might be forced to move into planting another crop.”
To counter this discriminatory EU resolutions, Shahrir urges all Malaysians, including the smallholders to have a ‘national protest’ by joining the petition on EU’s campaign against palm oil.
“Any Malaysian can come to its nearest Felda office nationwide to sign for the petition. We are expecting around 100,000 participants,” says Shahrir.
The National Association of Smallholders, which oversees over 400,000 smallholders nationwide, is also joining forces with Felda for the said petition.
Shahrir adds that Felda is targeting to submit its smallholders’ petition by early January next year to the EU ambassador in Malaysia.