This month, the European Union expressed intentions to ban the use of palm oils in biofuels. Given that Indonesia and Malaysia are the main exporters of palm oil worldwide, they will be hardest hit by the proposed ban. Malaysia’s minister of trade is hitting back saying that the move will impact and discriminate against the rural poor in both countries. In fact, a ban of any type will affect the revenue source of over 650,000 small agrarian workers in rural Malaysia.  

Earlier this year, amongst incrementing concerns regarding the impact of palm oils used in biofuels on the environment, the European Parliament voted that a draft law be set in place to ban the usage of the oil rather than more sustainable energy forms by 2021.  

Malaysia’s Minister of Trade, Mustapa Mohamed, stated that he would mention the concern once he met with Cecilia Malmstroem, the European Union’s Trade Commissioner, during the 2-day Singapore Association of Southeast Asian Nations (ASEAN) regional meeting of trade ministers from Southeast Asian countries.

Mohamed told reports that given the importance of the subject he would definitely raise it with Malmstroem.  He added that they had been in touch and were given assurances that the decision regarding the ban was not yet final and that the vote from the European Parliament was not compulsory as of yet.

Palm oil use has been a source of controversy for a long time given that environmentalists report that it propels deforestation as massive areas of rainforest are cut down to allow for plantations. In response to deforestation concerns, in 1992 the Malaysian Government promised to cut palm oil plantation expansion by keeping at least half of the country’s land as forest cover.

The oil is a key component of many products used globally from cosmetics to food. In fact, it is a typical cooking ingredient across Southeast Asia, Africa, and areas in Brazil. Its widespread use in the food industry is due to its low cost and high saturation of refined palm oil when used in frying, for example. One report showed that in 2015, 7.7 kgs of palm oil was used per person on average.

At least in Europe its use in cosmetics and the food industry has plummeted thanks to pressure on large companies from activist groups, such as the Roundtable on Sustainable Palm Oil. However, the use of palm oil has been escalating in biofuels.