In an interview, Malaysian Minister of Plantation Industries and Commodities, the Hon. Datuk Seri Mah Siew Keong, considers the impact of recent actions in Europe that are against the interests of the palm oil industry.

How does Malaysia view the EU Parliament’s vote in April to adopt the ‘Resolution on Palm Oil and Deforestation of Rainforests’?
The Resolution makes multiple unjust accusations against the palm oil industry, without offering any evidence. It does not recognise the positive and essential socio-economic role that palm oil plays in producer countries, by reducing poverty and enabling prosperity for millions of small farmers. It is highly disappointing, and highly unusual, that a trading partner would take such a confrontational approach.

As the EU works on formalising its sustainability requirements into law, what course of action does Malaysia have in mind?
What is critical now is that we in Malaysia – the government and private sector – must formulate a comprehensive and fully-resourced strategy to defend Malaysia’s trade interests in Europe. Securing continued market access for Malaysian palm oil is the over-riding objective.

The Resolution aims at phasing out the use of palm oil in the EU’s biofuels production by 2020. Analysts estimate that the EU uses 3-3.5 million tonnes of its palm oil imports for this purpose. Is this a significant volume in terms of Malaysia’s exports?

The volume is not the key factor in this issue – rather, it is the principle that the EU must not discriminate against palm oil. The proposal is unacceptable. It also does not make sense, as it would deprive Europe of an excellent year-round supply of feedstock that is sustainably produced.

This is not the first case of discrimination against palm oil in Europe. Just as Malaysia took a strong stance against the ‘Nutella tax’ proposal in France, we will be equally firm in resisting the process to give legal effect to the Resolution.

 

Could we confirm that the Malaysian government has engaged lawyers to prepare for a scenario where the Resolution may be enforced by law?
It is important to remember that Malaysia and other palm oil-producing countries had communicated facts about palm oil to the MEP Rapporteur in the European Parliament and to others ahead of the April 4 vote on the Resolution.

Malaysia’s Prime Minister has since made it very clear that, whenever there is discrimination, we will retaliate. The correct course of action may not necessarily be legal action, but a comprehensive strategy to defend our products and secure market access in Europe.

2017 has been a busy year thus far for palm oil especially in Europe. Led by health and environmental claims leveled against palm oil, Europe has launched multiple policy threats, which serve possibly to restrict trade in this important commodity.

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Summary

 

Indonesia expects substantial yield increases with new oil palm materials

 

PT SMART Tbk, a subsidiary of Singaporean palm oil company Golden-Agri Resources Ltd, announced on May 22 that it had cultivated high-yielding oil palm planting materials that could “substantially” increase the yield from its plantations without increasing land use.

The two materials – Eka 1 and Eka 2 – were developed at the SMART Research Institute and SMART’s Biotechnology Centre, through a conventional selection programme and tissue culture from “elite palms”.

“Tissue culture helps us propagate planting materials through a non-GMO process that produces more CPO; and, in the near future, it will help to produce planting materials that make better use of nutrients and are more resistant to both disease and drought,” said SMART’s head of plant production and biotechnology division Tony Liwang.

The materials could increase SMART’s CPO yield to more than 10 tonnes/ha/year at the prime palm production age of 8-10 years, from its current yield of 7.5-8 tonnes/ha/year under optimal soil conditions, according to the company. Indonesia’s industry average yield is still under 4 tonnes/ha/year, SMART said.

“With the success to date of our tissue culture programme, we can expect to see substantially higher yields with Eka 1 and Eka 2, and greater oil extraction levels from the fruit itself,” Liwang said.

SMART expects the Eka 1 seedling to produce 10.8 tonnes/ha of CPO at prime maturity, with oil extraction levels of 32% due to increased oil ratio in the fruit, while the Eka 2 seedlings are projected to yield 13 tonnes/ha and 36% oil extraction.

Furthermore, the company expects the seedlings to reach the first harvest in 24 months, in contrast to the current industry average of 30 months.

It intends to multiply the seedling clones through tissue culture over the next five years to cultivate a sufficient quantity to plant over a larger commercial area by 2022.

SMART started developing the materials in 2007, when its research team studied more than 4,000 oil palm trees for differing varieties. Field technicians selected and bred the optimal specimens over the next 10 years.

The first clonal seedlings were planted in 2011. Following several trials and commercial pilots, Golden-Agri Resources had by 2016 planted the materials in Sumatra and West Kalimantan in Indonesia.

Source: Oils & Fats International, June 2, 2017

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Reserved dairy names barred for plant-based products in the EU

On June 14, the European Court of Justice (ECJ) ruled that plant-based products cannot be labelled with dairy names such as ‘milk’, ‘cheese’ or ‘butter’ even if the plant origin is clearly marked on the label.

The ECJ ruling gives a very strict interpretation of the EU’s rules on the use of designations reserved for milk and milk products. This was in a case brought against a German company for marketing vegetarian and vegan products labelled with dairy names such as ‘tofu butter’ and ‘veggie cheese’.

The ECJ concluded that for marketing and advertising purposes, in principle, the designations ‘milk’, ‘cream’, ‘butter’, ‘cheese’ and ‘yogurt’ are reserved under EU law for products of animal origin only.

Its ruling prohibits the use of dairy names in association with purely plant-based products unless the names are included in the EU list of exceptions. The ECJ also clarified that this prohibition applies even when the plant origin of the product is stated, because the addition of descriptive and explanatory terms cannot completely rule out consumer confusion.

The ECJ ruling is an interpretation of the EU’s Single Common Market Organisation (CMO) 1308/2013 which repealed Regulation 1234/2007. The Single CMO establishes marketing standards for milk and milk products and sets out definitions, designations or sales descriptions that may only be used for the marketing of dairy products.

By way of exception, the Single CMO allows the marketing of plant-based products under the reserved designations when the exact nature of the product is clear from traditional usage (e.g. coconut milk) and/or when the designations are clearly used to describe a characteristic quality of the product (e.g. creamy).

The EU’s first Single CMO Regulation 1234/2007 required member-states to provide to the European Commission (EC) an indicative list of non-dairy products meeting the criteria. Based on the lists submitted, Commission Decision 2010/791 – in force since December 2010 – has established a list of non-dairy products that may be labelled with reserved dairy names.

The list of exceptions is a collection of product names grouped per language (not product). Product names included in the list are not translated in all EU languages. The English-language term ‘almond milk’ for example is not included in the list, but the French, Spanish and Italian terms ‘lait d’amandes’, ‘leche de almendras’ and ‘latte di mandorla’ are.

The ECJ does not accept translations of product names included in the list as falling within the scope of authorised exceptions. The EC has clarified that, in the event of a dispute, it is ultimately for the ECJ to provide a definitive interpretation of the applicable EU law.

Source: USDA, July 11, 2017

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Nutella maker wins court battle against ‘No palm oil’ claim

 

A Belgian court has ruled that advertising claims about the health and environmental benefits of the palm oil-free Choco spread are illegal, in a case brought against the supermarket chain Delhaize.

Ferrero, which manufactures Nutella, took the case to court. Delhaize has been ordered not to repeat any claims about its Choco spread being better for the planet or human health, on pain of a €25,000 (£22,000) fine for each repetition.

Source: www.theguardian.com, June 19, 2017

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European chemicals agency refutes accusations linked to glyphosate

The European Chemicals Agency (ECHA) has fired back at NGO accusations that it carried out a malicious attempt to undermine the authority of the EU’s food safety agencies and their assessment of the ubiquitous herbicide glyphosate.

The ECHA also refuted claims it breached EU regulations and colluded with the pesticide industry when assessing the carcinogenicity of the herbicide.

In March, Global 2000 – a consortium of NGOs including Friends of the Earth and the Pesticide Action Network in Europe – released a stinging report. This argued that industry-funded studies showing that glyphosate is safe contained “fundamental scientific flaws” due to the omission of key data and inclusion of irrelevant data.

These studies were then used by both the European Food Safety Authority and the ECHA in their positive opinion of glyphosate.

“[The] ECHA is concerned [about] an attempt to publicly malign the integrity of EU institutions mandated to ensure safe use of chemical substances in the EU,” the Helsinki-based institution responded.

“This is of particular concern, when the process actually provides the opportunity to submit any further data and to make any science-based observations during the process.”

In making its assessment on glyphosate, it said “there was no collective preconception of whether or not the substance was hazardous for any of the end-points, let alone any collusion with industry, as alleged in the Global 2000 report”.

The ECHA’s opinion will be taken into consideration by member-countries who must vote on whether to renew the licence for glyphosate by the end of the year.

Source: www.politico.eu, Aug 8, 2017

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From 1965 to 1967, in addition to bringing to completion our programmes for planting, roads and buildings, we were also very preoccupied with the erection of our factory. At that time, the only company which could build a standard turn-key palm oil mill on contract, was Messrs Stork of Amsterdam.

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The editorial committee of the American Oil Chemistry Society asked Professor Casimir Akoh to edit a book on palm oil. The ambitious title given was ‘Palm Oil Production, Processing, Characterization and Uses’. Prof Akoh and his two assistants invited contributions from known experts across the world. The resulting book of 836 pages in 25 chapters fully satisfies the title.

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One of the biggest factors in a successful branding campaign, whether we are talking about edible oils and fats or other products for the market, is motivation. As a marketer of many years, I’m still amazed at how organisations can so easily get caught up in ‘big picture’ concepts and ‘small stuff’ details, such as budget and pricing, without remaining focused on motivation.

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Falie is a typical rural Liberian settlement with a population of around 1,500, roughly 24km off the nearest covered road. The houses are rough and ready, using local timber, mud and corrugated iron. No running water, no sewerage, no electricity, no health clinic, no school, no shop. Not much, in effect, apart from a tightly-knit community spirit and intense loyalty to the Zodua Clan, made up of Falie itself and two similar settlements, Gohn and Karnga – 4,760 people in all, and what seems like a long way from the capital, Monrovia.

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The speed at which news moves around the world today has opened the floodgates to a flurry of questionable information that deliberately misleads and misinforms. ‘Fake news’ can undermine companies, and even whole economic sectors, if there is no strategy to combat its spread.

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How will President Emmanuel Macron’s government handle the populist debate around science and regulation in France? The early signs are encouraging – Macron has criticised US President Donald Trump for his stance on climate change, and has encouraged scientific researchers to come to France.

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In an interesting study by UCLA professor Alan Castle and his colleagues, only one person out of more than 100 students could accurately draw the Apple logo from memory. According to Prof Castell, the most famous experiment on this subject showed that few people could correctly recall the placement of the features on a penny coin – which way Lincoln is facing or where the word ‘Liberty’ goes. This was likely due to information overload or ‘attentional saturation’.

Now, how many of us have looked at the Malaysian currency and realised that oil palm tree is prominently displayed at the back of the 50-Ringgit bank note?

Bank notes are an important medium of transaction. They have also come to symbolise a nation’s identity, as notes or coins may carry designs associated closely with its history and culture. The country’s name is automatically linked to the currency, be it the US Dollar, British Pound Sterling, Japanese Yen, European Euro or the Malaysian Ringgit (RM).

The oil palm tree is reflected on the RM50 bank note in recognition of the strategic importance of the industry in driving the Malaysian economy. The 16 million tonnes of palm oil exported in 2016 represented 37% of the global palm oil trade.

The most recent genesis of the RM50 bank note stems from the 50th year of Malaysia’s Independence. In December 2007, Bank Negara Malaysia launched the fourth series of this bank note, featuring the oil palm tree (along with biotechnology) as an icon. The design is based on the National Mission – the first thrust aims to move the economy up the value chain to higher value-added activities in agriculture, manufacturing and the services sector.

Conversation piece
The RM50 bank note is the perfect tool to explain the importance and value of the miracle that is Malaysian palm oil. On my travels, I have observed that many people do not know what palm oil is derived from. This is to be expected because the oil palm is not planted in many parts of the world. Those in Europe, for example, are more familiar with rapeseed, sunflower or the olive tree.

We are unable to transport an oil palm tree across borders to show what its looks like. But I have often wondered why the RM50 bank note has not been used as a promotional tool to educate people about the oil palm and its main product, palm oil. After all, Malaysians usually carry Ringgit notes in addition to other currencies when travelling.

Some years ago, when I attended a hearing on a palm oil-related Bill in the Australian Parliament, a Senator mentioned never having seen an oil palm tree. And yet, Australia was planning to make an important decision that would affect palm oil.

I then realised how important it is to always carry a RM50 note with me. Although there are other options, such as a photo of the oil palm tree, I can confidently say that the bank note will always make a more interesting conversation piece.

It could earn you a couple more friends, although you may end up losing RM50 as the bank note is sometimes claimed as a souvenir item! But the loss is small when you can remove misconceptions about the oil palm industry. And unlike printed materials used for education and promotion, a bank note will not be dumped in a bin, since people are aware of its monetary value.

The depiction of an oil palm tree on the RM50 bank note makes it an unusual and meaningful gift item, as it promotes Malaysia, its currency and the oil palm industry all at once.

Belvinder Sron,
Deputy CEO, MPOC

 
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