More anti-palm oil campaigns on the horizon with new hurdles Commodities Talk - By Hanim Adnan

Hanim Adnan

WHILE Malaysia fought admirably to topple the anti-palm oil campaigns such as the Nutella Tax proposal in France and the palm oil labelling issue in Australia last year, more smearing campaigns instigated by Western NGOs and green activists are set to crop up this year.

Of particular interest would be the possible introduction of new trade barriers targeted specificially at palm oil by several member countries within the European Union (EU).

Market observers, including the Malaysian Palm Oil Council (MPOC), are saying that 2013 would see a dangerous new tide of trade regulations, red tape and protectionism that would jeopardise the market access of palm oil and other vegetable oils into the EU.

The EU governments are now legislating their food standard policy in which palm oil, in particular, is being attacked both on the health and sustainability fronts.

In France, the false claims on palm oil's alleged adverse impact on health and the environment being circulated in the French media continue to influence the minds of consumers there, despite the support for palm oil by French scientists and experts from the Centre for Agricultural Reseach for Development, the renowned Pasteur Institute and the French Foundation for Health and Nutrition.

What started in France last year has triggered a domino effect, whereby the safety concerns on palm oil are being heavily raised in Belgium and Switzerland.

In Belgium, the Constitutional Health Council is undertaking investigations on palmitic acid and is planning to publish a report outlining the fabricated dangers to the Belgian consumer's diet.

Also, similar to what had happened in France last year, several politicans in Switzerland are championing for a ban on using palm oil in certain districts.

According to the MPOC, the European Commission (EC) later this year would release a Communication on Sustainable Food believed to be the first step towards an EU policy outlining full environmental and sustainability standards for food consumed in the region.

The EC is also looking at reducing the greenhouse gas emissions of food consumption, reducing the land use of food imports, incentivising the improvement of resource efficiency and food security and reducing water usage in agriculture.

In view of all these, will Malaysia, as one of the world's largest producers of palm oil, take a stand at the World Trade Organisation should the EU introduce its discriminatory sustainable food standards later this year?

Ironically, all this is happening at the onset of oil palm being extensively cultivated in new frontiers such as Africa, Cambodia, Laos and Myanmar with the noble intention of generating income and eradicating poverty among smallholders and farmers.

Given the growing world population and per capita income, it has been projected that palm oil demand would continue to increase from 45 million tonnes in 2010 to 60 million tonnes in 2015, and hitting a whopping 75 milllion tonnes in 2020.

In terms of yield, palm oil production is one-tenth more than other oilseed rivals such as soybean oil and rapeseed oil, making it far more economical to produce crude palm oil.

Deputy news editor Hanim Adnan knows that the truth will prevail in the battle between palm oil and its detractors.