THE government is committed to ensuring smallholders are not left out of the palm oil supply chain following the introduction of new palm oil regulations by foreign countries, said Deputy Prime Minister Fadillah Yusof.

He said Malaysia thinks regulations the European Union wants to implement should involve negotiations with the government.

The message was delivered by the government during the joint mission of Malaysia and Indonesia to the EU through the Council of Palm Oil Producing Countries (CPOPC) in Brussels, Belgium, late last month.

“This is our struggle. Our purpose in going to the EU that day was to state that whatever they implement must involve us in all negotiations so that smallholders in particular will not be neglected or left out of the palm oil supply chain,” he said while officiating at the closing of the FGV Consultation Programme with Smallholders and Suppliers in the Miri Area today.

Fadillah, who is also plantation and commodities minister, said Malaysia and Indonesia had conveyed their position and concerns regarding the implementation of the EU Deforestation Regulation (EUDR) to the bloc. 

He described the introduction of various regulations on palm oil as a way of competing in the form of discrimination and trade barriers, because palm oil is more productive compared with oil produced from other sources such as soybeans, sunflowers or corn.

“Praise be to God, they have heard our views and they will come to Malaysia to go into detail about the discussions, and hopefully our Malaysian Sustainable Palm Oil (MSPO) certification scheme will be adopted so smallholders will remain in the global palm oil supply chain,” he said.

He said it is important for smallholders maintaining environmental sustainability not only to meet the needs of the world market.

MSPO or Roundtable on Sustainable Palm Oil (RSPO) compliance is to ensure the environment is preserved for future generations. 

He said the government understands challenges faced by oil palm smallholders, especially in relation to prices determined by global demand.

He said every smallholder should be prepared for worldwide economic uncertainty, with the global economy expected to grow by 3% until 2028.

He said the local economy is forecast to grow by 4% to 5% with steady exports. 

Fadillah thinks there will be steady demand for palm oil but the price may vary. 

He advised palm oil smallholders not to rely solely on the commodity, but perform integrated farming to generate consistent income. – Bernama, June 17, 2023.