Malaysia’s Small Farmers Defeat Europe’s Planned Ban on Palm Oil Biofuels

Compromise Agreement on RED is Reached; Ban on Palm Oil is Rejected

KUALA LUMPUR, Malaysia – Malaysia’s Small Farmers took a major step towards defeating the EU’s planned ban on Palm Oil biofuels, after the EU reached a compromise position on the Renewable Energy Directive (RED).

To be clear: the final text of the RED agreed by the negotiators, did not include any ban on Palm Oil biofuels. Explicit criticism of Palm Oil was also removed from the final RED text.

This is good news for Malaysian Small Farmers, in the face of a concerted and aggressive campaign by a chorus of protectionists from Europe. It is important to remember why this matters:

  • 650,000 Malaysian small farmers and their families depend on Palm Oil
  • Palm Oil is the biggest driver of poverty alleviation for rural communities
  • The EU ban would have harmed the incomes and livelihoods of these families
  • Defeating the ban is a win for economic development over protectionism

In January 2018, the EU Parliament voted overwhelmingly in favour of a total ban on all Palm Oil biofuels, from 2021. That plan was rejected by the EU Commission and by EU governments, following a well-directed campaign from Malaysian Small Farmers.

The proposed Palm Oil ban from 2021 has been completely removed from the final RED text that was agreed in Strasbourg on 13th June.

A final vote is now required in the EU Parliament and Council to confirm the RED Directive.

Dato’ Haji Aliasak Bin Haji Ambia, President of the National Association of SmallHolders (NASH), said:

“We are pleased the EU’s planned ban on Palm Oil biofuels from 2021 was rejected.  The ban was anti-WTO, protectionist, discriminatory, and totally unacceptable. No ban on Palm Oil will take place, and the European market will remain open to Palm Oil biofuels.

“This is a cause for celebration for all Malaysians, especially the 650,000 small farmers and our families across the country. All those in Europe who lobbied for a Palm Oil ban were really lobbying for poverty and hardship for Malaysians.

“Members of the European Parliament sought to sentence Malaysia’s Small Farmers to a life of poverty. They have stated already their plan to control Palm Oil again after 2019 through ILUC and a new regulation on Palm Oil imports for food. This is more of the same: discrimination and unequal treatment.  The fight continues.”

 

Here Are The Facts:

The Original Ban

On 17th January 2018, the EU Parliament demanded three very simple things:

  1. Total ban on all palm oil biofuels under the RED
  2. The ban to begin immediately in January 2021
  3. No other oil crops would be subjected to this criteria or discrimination. Only palm oil.

All three of these points have been deleted from the final RED Compromise Agreement on 13th June 2018. The EU ban on Palm Oil has been defeated.

The Situation Today

The three EU demands were defeated, and replaced with the following in the RED compromise text:

  1. EU Commission will present a report in 2019 about how to calculate ILUC and HCS emissions from biofuels considered “High Risk.” No specific crop is targeted.
  2. Based on the new EU report on high risk biofuels, some biofuels will be capped at their 2019 import level. There will be no ban on any crop. No specific crop is currently targeted for a phase-out.
  3. Based on the new EU report, some biofuels may be gradually phased out from 2024-2030. There will be no ban on any crop. No specific crop is targeted, as of today.

Palm oil is not mentioned, or targeted, at all in the new text.

It is entirely inaccurate to state that palm oil has been banned or phased out under the RED. That statement no longer exists in the final RED text.

Looking Ahead

The EU Commission’s planned report on ILUC and High Carbon Stock in 2019 will be the beginning of the next battle over Palm Oil biofuels. ILUC has been condemned as junk science by economists and experts worldwide. Opponents will now attempt to use ILUC and HCS as the vehicles to restrict the future use of Palm Oil biofuels in Europe.

Draft version of the RED Compromise Text – Article 25

In case the contribution from biofuels and bioliquids, as well as from biomass fuels consumed in transport, produced from food and feed crops in a Member State is limited to a share lower than 7% and/or a Member State decides to limit the contribution further, that Member State may accordingly reduce the overall share referred to in the first sub-paragraph.

The contribution to the targets set out in Article 3(1) and Article 25(1) from high indirect land-use change risk food or feed crop-based biofuels, bioliquids and biomass fuels produced from crops for which a significant expansion of the production area into land with high carbon stock is observed, shall not exceed the level of consumption in 2019 in the Member State, unless they are certified as low indirect land-use change-risk biofuels, bioliquids and biomass fuels pursuant to []. As of 31 December 2023, their contribution shall decrease gradually to reach a contribution of 0% by 31 December 2030 at the latest. 

The Commission shall submit, by 1 February 2019, to the European Parliament and the Council a report on the status of production expansion of relevant food and feed crops worldwide and shall adopt, by 1 February 2019, a delegated act setting out the criteria for certification of low indirect land-use change-risk biofuels, bioliquids and biomass fuels and for establishing the high indirect land-use change risk feedstocks for which a significant expansion of the production area into land with high carbon stock is observed. The report and the accompanying delegated act shall be based on the best available scientific data.

 

Faces of Palm Oil is a joint project of the National Association of Small Holders (NASH), the Federal Land Development Authority (FELDA), the Dayak Oil Palm Planters Association (DOPPA), the Sarawak Land Consolidation and Rehabilitation Authority (SALCRA) and the Malaysian Palm Oil Council (MPOC) that seeks to advocate on behalf of Malaysian smallholders. To learn more, visit FacesOfPalmOil.org

Equal Treatment for Palm Oil Biofuels, Demand Malaysian Small Farmers

EU “Compromises” on Palm Oil Must Respect WTO and Non-Discrimination

KUALA LUMPUR, Malaysia – Malaysia’s small farmers set out their expectations as the EU institutions enter their fifth Trilogue negotiation over the Renewable Energy Directive (RED), on Wednesday 13th June.

EU leaders are split on how Palm Oil imports will be treated under the RED: MEPs have called for a total ban; the French Government proposed a freeze on Palm Oil imports; now new compromise proposals have been tabled calling for the EU Commission to investigate feedstocks expanding into “high carbon stock” land.

The National Association of SmallHolders (NASH) sets out that any compromise must treat Palm Oil equally; must respect WTO rules; avoid non-scientific criteria such as ILUC; and reject politically-motivated terms such as “high carbon stock” (HCS).

Dato’ Haji Aliasak Bin Haji Ambia, President of the National Association of SmallHolders (NASH), said:

“EU leaders, Ministers and Ambassadors have made multiple promises to Malaysian small farmers over many months. The only way we can trust Europe is if there is 100% equal treatment for Palm Oil biofuels. That is the only fair, just and WTO-acceptable outcome from today’s Trilogue.

“That means:

  • No cap, freeze, or ban targeting Palm Oil;
  • No deceitful technical criteria, such as ILUC;
  • No reliance on unclear and undefined terms, such as HCS;
  • No WTO-incompatible targeting of non-EU feedstocks.

“Anything else would be a betrayal of Europe’s promises to Malaysia.  

“The EU claims to disagree with President Trump – but if the EU imposes any trade restrictions on Palm Oil biofuels it is clear that they are simply copying & pasting Trump’s anti-trade playbook to satisfy their domestic protectionist lobbies.”

 

ENDS

Faces of Palm Oil is a joint project of the National Association of Small Holders (NASH), the Federal Land Development Authority (FELDA), the Dayak Oil Palm Planters Association (DOPPA), the Sarawak Land Consolidation and Rehabilitation Authority (SALCRA) and the Malaysian Palm Oil Council (MPOC) that seeks to advocate on behalf of Malaysian smallholders. To learn more, visit FacesOfPalmOil.org.

ICYMI: Reuters – Malaysian Small Farmers Criticise French ‘Betrayal’

On Monday, 11 June, French Environment minister Nicolas Hulot announced on Twitter that “France wants to stop the rise in use [of palm oil and soybean oil] from one year to the other.” This follows efforts by French officials in Brussels to propose a freeze on Palm Oil biofuel imports as part of the EU’s Renewable Energy Directive.

This proposal is a betrayal of multiple promises made by the French Government, which Faces of Palm Oil noted yesterday. The French Government is now adopting Trump-like trade tactics that violate WTO rules.

Reuters reports the protests of Malaysian small farmers, whose livelihoods are threatened by the French proposals:

“Small farmers in Malaysia, the world’s second largest palm oil producer after Indonesia, said a move to cap palm oil exports at an EU level would be discriminatory and a “betrayal”.

Dato’ Haji Aliasak Haji Ambia, President of National Association of Smallholders (NASH) Malaysia, explained to international media the consequences of a disguised ban:

“This proposal is a betrayal of promises made by the French Government, and others in Europe, to the people of Malaysia,” they said in a statement sent by Faces of Palm Oil lobby group. Those promises must be honoured. Attempts to camouflage this discrimination behind technical calculations are deceitful.”

As Europe moves toward a conclusion of the Renewable Energy Directive (RED) negotiations, they must guarantee 100% equal treatment for Palm Oil alongside other oilseeds, and scrap the proposition of a ban altogether.

Faces of Palm Oil is a joint project of the National Association of Small Holders (NASH), the Federal Land Development Authority (FELDA), the Dayak Oil Palm Planters Association (DOPPA), the Sarawak Land Consolidation and Rehabilitation Authority (SALCRA) and the Malaysian Palm Oil Council (MPOC) that seeks to advocate on behalf of Malaysian small farmers. To learn more, visit http://facesofpalmoil.org

Malaysia’s Small Farmers Condemn 11th Hour Move by France and Italy to Discriminate against Palm Oil

KUALA LUMPUR, Malaysia – Today, the National Association of Small Holders (NASH) condemned the 11th hour tactics of the Governments of France and Italy to impose a freeze on Palm Oil biofuel exports as part of the EU’s Renewable Energy Directive (RED).

This proposal is a betrayal of promises made by the French Government, and others in Europe, to the people of Malaysia.

The proposed freeze replaces the planned Ban on Palm Oil originally passed by the EU Parliament in January 2018.

The new proposal will be discussed on 11th June in Luxembourg, at a meeting of EU Energy Ministers.

As reported by Euractiv, the proposal consists of a “cap on counting towards the targets at a level of 2020 consumption or on a basis of a threshold 130 gCO2eq/MJ”.

Any cap on Palm Oil biofuel exports to Europe is a discriminatory act and a clearly-targeted trade barrier aimed at Malaysia’s 650,000 small farmers of Palm Oil.

The RED must guarantee 100% equal treatment for Palm Oil with other oilseeds. This is the only acceptable outcome for international trade rules and is the only outcome that will avoid unnecessary and negative trade consequences for both Europe and Malaysia.

Dato’ Haji Aliasak Haji Ambia, President, National Association of Smallholders Malaysia stated:

“Any EU ban or cap on Palm Oil biofuels is a discriminatory action against the hundreds of thousands of small farmers across Malaysia. The Governments of France and Italy promised that there would not be discriminatory treatment against Palm Oil. Those promises must be honoured. Attempts to camouflage this discrimination behind technical calculations are deceitful. Europe is now adopting Trump-like trade tactics that violate WTO rules. The EU cannot credibly claim to be a defender of global trade if this discrimination against Palm Oil is adopted.”

 If Member States and the Commission are true to their word about defending international trade, they should reject this compromise proposal – and commit to equal treatment for Palm Oil.

 

Some of the many EU promises made to Malaysia:

RED Trilogue #4: Deadlock in Brussels

The fourth Trilogue on the Renewable Energy Directive (RED) took place in Brussels on 31st May; and as far as Palm Oil is concerned the situation is ‘as you were’.

Palm Oil was discussed only briefly during the Trilogue meeting, and that discussion was short and to the point. The EU Parliament continues to insist on a ban on Palm Oil biofuels. The EU Commission continues to oppose the ban.

To summarise more accurately, the positions of the three institutions are as follows:

  • The EU Parliament is still intent on imposing discriminatory protectionist trade barriers on Palm Oil that clearly break WTO rules – and will make Europe look and act like President Trump, who is declaring a global trade war on everyone.
  • The EU Commission remains committed to defending WTO rules, and Europe’s position in the world – and therefore opposes the Palm Oil ban.
  • The Council of the EU (made up of the 28 EU governments) remains divided.

Why is the Council divided? Strong and well-funded lobbying by rapeseed interests in Central and Eastern Europe means that many of those governments are now supportive of the Palm Oil ban.

The larger countries in the Council – including Spain, Italy, Netherlands, and France – remain opposed to the ban. Again, the WTO issue is to the fore, as well as the fact that a trade dispute would be highly damaging because these countries export a lot to ASEAN.

Others – including Germany and the U.K. remain uncommitted unsure of whether to grab the mantle of global trade leadership for Europe or surrender to a domestic minority and discriminate against South East Asian trading partners. Therefore, the Council does not have a unified position.

 

What happens now?

 

A period of reflection takes place in all three EU Institutions..

 

In the EU Parliament, the MEPs will discuss whether or not they should drop the ban, and instead agree to a compromise.

In the Council, a meeting of EU Energy Ministers is scheduled for 11 June. A new compromise proposal on Palm Oil is likely to be presented by the Bulgarian Presidency of the Council of the EU, and perhaps agreed by the Member State Ministers.

It is worth recalling that the EU Parliament has rejected all previous compromise proposals put forward by the Council. Will they ever be prepared to back down from their absolutist position?

 

From the perspective of producing countries there is only one test for any proposed compromise. Equal treatment.

Any final RED must commit to equal treatment between Palm Oil and EU-produced oilseeds. This ‘Equal Treatment’ principle is essential in order to satisfy WTO rules, and in order to prevent a damaging trade dispute with South East Asia and an erosion of European leadership in the region. It really is that simple.

The Member States supporting WTO and good trade links, as well as equitable treatment, should stand firm. France, Spain, Sweden, Italy, Netherlands and others have proven themselves to be committed to global rules and long-term mutually-beneficial trade. They have rejected the siren voices of protectionism who call for Palm Oil to be banned.

France and Total, in particular, has been targeted by bullying campaigns and guerrilla-like tactics from NGOs and trade unions – despite it being clear that French strategic interests at home and abroad, especially job creation, favour good relations with Palm Oil producing countries in Asia and Africa.

The support from France and others has attracted significant praise and gratitude across Palm Oil producing countries and regions.

To summarise, the RED battle continues: neither side has prevailed, and no final decision has been made. Triumphalism or defeatism on either side would clearly be premature.

As 13th June, and Trilogue #5 approach, thoughts in much of Europe – and the world – are turning away from politics, towards the football World Cup. It’s clear there is still everything to play for in the RED negotiations.

Is the EU Planning a Disguised Ban on Palm Oil under RED?

The EU’s Trilogue negotiation process is about finding a compromise: that’s how it works. The current Trilogues over the Renewable Energy Directive (RED) are no different. The EU negotiators effectively face two opposing positions on the issue of Palm Oil. The EU Parliament wants to ban it entirely; and the Commission and Council reject that ban.

If common sense prevails, the ban will be dropped altogether. That is WTO-compliant, non-protectionist, helps the EU’s trade strategy, and gives more choice to EU renewable energy users and consumers – and most importantly assists oil palm farmers around the world.

However, common sense is rarely the forte of the EU Parliament. Are the other parts of the EU able to find a way forward?

They’ve made one attempt already in the form of a re-brand. Brussels tried to re-brand the ban on Palm Oil in the media as a “Subsidy Cap”. This was an attempt to convince producing countries that a discriminatory market barrier is not that bad. Yeah, right.

The EU’s Embassy in Indonesia tried this as well: it actually released a document claiming that no trade barriers or discriminatory legislation towards Palm Oil exist.

The EU’s Embassy in Malaysia tried as well when they stated, “The EP has not voted in favour of a ban of palm oil-based biodiesel. Instead it has voted in favour of excluding biofuels produced from palm oil from being accounted towards the EU Renewable Energy targets. This would by no means limit the amount of biofuels from palm oil that can be produced or imported and consumed in the EU.”

Small farmers know a ban when we see one. How do we know the ban on Palm Oil is a ban (and not a “subsidy cap”)? We know because the EU Parliament – which first proposed the ban – said it was a ban.

Here’s the official EU Parliament press release: “MEPs vote to ban palm oil in biofuels from 2021”

Virtually the only reason biofuels are used in the European Union in such volumes is because the law – the RED – mandates the use of renewable fuels.

Palm Oil can be and is legally used as a feedstock for biofuel under the RED because it meets the EU’s criteria.  Removing Palm Oil from the RED is an effective ban. It kills demand for Palm Oil renewables in the EU. To suggest otherwise is misleading.

This attempt to find a middle ground failed. What’s next?

The EU will likely try for a ‘Disguised Ban’ on Palm Oil: it won’t call out Palm Oil, but will introduce new, tougher criteria to lock Palm Oil out of the EU (in effect, achieving the same result as the outright ban).

Such a ‘Disguised Ban’ may introduce some form of Indirect Land Use Change (ILUC) or additional sustainability criteria.  We don’t know; however, look for something to come out soon, perhaps ahead of the next Trilogue on 17th May.

Such a disguised ban would be pleasing for many in Brussels, especially the MEPs and the Commission can say to its ASEAN partners, ‘See? We stopped the ban.’

Not so fast.

ICYMI: The Times exposes threat to UK jobs from the EU’s proposed Palm Oil ban

The Times published this morning an article by Ben Webster highlighting how U.K. defence contracts – responsible for thousands of jobs – could be at risk from the EU’s proposed ban on palm oil biofuels.

The deal, worth more than £1.5 billion, could be in trouble should the EU move forward with the proposed Palm Oil ban.

The Times revealed that emails exchanged between the UK Ministry of Defence and Malaysian officials described how an outright ban “could affect our bilateral relationships and potentially defence sales.”

Webster writes:

 “Malaysia plans to buy up to 18 Typhoon fighter jets to replace grounded Russian MiG-29s. BAE Systems hopes to secure the contract, worth more than £1.5 billion. BAE employs 5,000 people directly in the UK on the Typhoon programme and there are 9,600 other jobs in the UK supply chain.

 The European parliament voted in January to phase out palm oil in biofuel, prompting a backlash from growers in Malaysia, where the issue could influence the outcome of tomorrow’s general election.

 Mah Siew Keong, a Malaysian government minister, has threatened a tit-for-tat boycott of European goods.”

Three million Malaysians, including 650,000 small farmers, all dependent on income from oil palm plantations, are at risk of being stripped of their livelihood should the EU vote to put an operational ban in place by 2021.

Read the full article in The Times online here.

Faces of Palm Oil is a joint project of the National Association of Small Holders (NASH), the Federal Land Development Authority (FELDA), the Dayak Oil Palm Planters Association (DOPPA), the Sarawak Land Consolidation and Rehabilitation Authority (SALCRA) and the Malaysian Palm Oil Council (MPOC) that seeks to advocate on behalf of Malaysian small farmers. To learn more, visit http://facesofpalmoil.org

ICYMI: The Guardian Investigation Finds the EU’s Palm Oil Ban Would be a Disaster

The Guardian published yesterday the untold story and real-life consequences that the European Union’s proposed palm oil ban will have on Malaysian farmers and communities should the palm oil ban go in to effect in 2020. The story also highlights how the proposed ban has “made the EU a dirty word in Malaysia” and damaged Europe’s image.

Speaking to several farmers in rural Malaysia, Hannah Ellis-Petersen reports on the devastating effects these farmers and their families will face should their livelihood be stripped from them.

Citing the all too real consequences the proposed palm oil ban will have on thousands of Malaysian farmers, Hannah Ellis Petersen speaks to these farmers who, for decades, have provided for their families and have lifted themselves out of poverty by tending to their oil palms.

Ellis-Petersen writes:

“Yet for Malaysia’s smallholder farmers, many of whom were rescued from poverty when the government’s land authority, Felda, gave them 10 acres of land to harvest palm oil in the 80s, the allegations of environmental destruction are baffling. They account for 40% of Malaysia’s palm oil output and yet none engage in any land-grabbing, the slash and burn or deforestation practices that were pivotal proponent for MEPs voting to ban palm oil in biofuels.

“There are also wider political ramifications of the EU ban. Banning palm oil in biofuels is likely to also weaken the EU’s influence in southeast Asia, and hand even more more power to China – the biggest palm oil customer in the world – at a time when the EU has expressed concern about increasing Chinese domination of the region.”

Dato’ Aliasak, President of the National Association of Small Holders Malaysia, is quoted saying, “Palm oil has allowed the rural poor in Malaysia to develop our own land, lift ourselves and our families out of poverty, and take control of our own economic destiny.”

Read The Guardian’s full article online here.

Faces of Palm Oil is a joint project of the National Association of Small Holders (NASH), the Federal Land Development Authority (FELDA), the Dayak Oil Palm Planters Association (DOPPA), the Sarawak Land Consolidation and Rehabilitation Authority (SALCRA) and the Malaysian Palm Oil Council (MPOC) that seeks to advocate on behalf of Malaysian small farmers. To learn more, visit http://facesofpalmoil.org

Malaysian Small Farmers Say No to EU Ban on Palm Oil

Today, the National Association of Small Holders (NASH) launched a new advertising campaign, “Europe’s Crop Apartheid”, in Politico Europe to defend Malaysia’s small farmers against the EU’s ban on Palm Oil biofuels.

The European Parliament’s ban on Palm Oil threatens 650,000 small farmers and over 3.2 million Malaysians who rely on the Palm Oil industry for their livelihoods. Some in Europe claim this is a ‘subsidy cap’, not a ban. Malaysian small farmers are not foolish. We know a ban when we see one. Approving this ban on Palm Oil biofuels will signal that Europe is retreating from its trade commitments in Asia.

Text of the advert:

Here’s the facts about the EU’s proposed Ban on Palm Oil under the Renewable Energy Directive:

  1. The European Parliament has voted to Ban Palm Oil biofuels.
  2. The EU Commission claims, “excluding biofuels produced from Palm Oil from being accounted” under RED is not a Ban. 
  1. The EU Commission wants you to think the Ban is a “Subsidy Cap” post 2021. This is patronising. Malaysia’s small farmers are not foolish: we know a Ban when we see one.
  2. The “Subsidy Cap” means exclusion for Malaysia’s Palm Oil farmers. European oilseeds will not be excluded. The very definition of discrimination.
  3. EU leaders attack American tariffs but now seek to impose discriminatory tariff-like measurers on Malaysian exports.
  4. Approving a Ban on Palm Oil biofuels will signal Europe is abandoning its WTO commitments and withdrawing from Asia.
  5. The Malaysian Government considers the Ban and any discrimination on Palm Oil biofuels as modern day Crop Apartheid imposed by Europe.

For more information on the Palm Oil ban: