Malaysia and Indonesia produce the majority of palm oil. The two largest palm oil exporters are Indonesia and Malaysia. Indonesian palm oils account for 58% of global market share, while Malaysian palm oil accounts for 24%.
The EUDR will also cover palm oil, which is a commodity often linked with deforestation.
The way governments control palm oil plays a major role in the industry as a entire.
The governments of Malaysia, Indonesia, and Thailand have all tightened the regulations surrounding palm oil in recent years to increase the sustainability of the industry. Will their efforts suffice?
The government wants to take control of the sector
This is reflected in two recent developments. According to Mongabay, in Indonesia, the Indonesian Government has blocked the Tanah Merah Oil Palm Project, which was long planned for the Papua region. This decision was upheld by Indonesia’s Supreme Court.
According to Earthsight NGO, the project would have provided around 2,800sqkm of primary forest to palm oil companies.
Human Rights Watch reports that Sarawak, Malaysia has ceased issuing licenses to new plantations of palm oil.
Luciana tellez-chavez, senior researcher for the organization, said that the decision to “mitigate the deforestation” was taken.
The two decisions are part of a larger effort by these countries to regulate palm oil.
The RSPO has been joined by national sustainability initiatives such as Indonesian Sustainable Palm Oil and Malaysian Sustainable Palm Oil.
In 2019, Malaysia banned the conversion of forest land, as Indonesia had done the previous year.
Tellez-Chavez says that despite this, the control over land is under the state’s jurisdiction in Malaysia, which makes it difficult to enforce the ban.
Tellez-Chavez says that “any policy change in these countries will have major consequences for the majority of palm oil in circulation around the globe.”
Recent scrutiny has “unquestionably pushed governments to act.” This has led to a moratorium on plantation expansion in Indonesia and Malaysia. Companies are also required to adhere the national palm oil certification scheme.
Does this impact the EUDR?
Tellez-Chavez believes that Sarawak’s decision not to renew palm oil plantation licenses is a testament to the EUDR’s effectiveness as a catalyst for change.
Here’s why you should protect the EUDR – it is effective. In a post on social media, she said that the EUDR encourages governments and industries to increase standards in order to preserve what’s left of wilderness around the globe.
It is not clear if this would work in reverse – i.e., if increased regulations could impact the status of the two countries at the EUDR benchmarking.
She explains that “certainly these measures would make palm oil exported from both countries more compliant with EUDR requirements” but in the end, the risk benchmarking criteria of the regulation was designed to evaluate results and not just promises.
The measures must be implemented, followed, and yield results, in order to reduce deforestation, respect rights, and increase the amount of trees.