Malaysia's Commitment, Compliance and Progress in Producing Certified Sustainable Palm Oil for the Global Markets

Transcription

1 Malaysia's Commitment, Compliance and Progress in Producing Certified Sustainable Palm Oil for the Global Markets Dr. Kalyana Sundram, Chief Executive Officer Malaysian Palm Oil Council (MPOC), Presentation at EPOC Nov 2017

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3 Deforestation: A definition that is still debated Malaysia s currently claims 56% forest and green cover, a commitment it has maintained since the Rio Earth Summit Universal definition of what actually constitutes a forest remains difficult. There was a net loss of129 million ha of forest between 1990 and Between 2010 and 2015 there was an annual loss of 7.6 million ha and an annual gain of 4.3 million ha per year. Thus net annual decrease in forest area of 3.3 million ha EU Resolution claims 13 million ha forest loss, versus our calculation (factual???) of 3.3 million ( )! How is such a discrepancy possible? The EU along with Western NGOs paint a very different and gloomy picture about deforestation. Palm Oil Producers are handicapped and not reacting with facts. Corrective measures are thus in order

4 Europe Exploits its Own Forest Resources, Which is Not Widely Known EU Conference May 2017: Beyond Wood The Multiple Services of Provided by Europe s Forests European forests provide resources that are also exploited by rural EU communities EU Forest based industries provide 3.5 million jobs within EU Only 50% of these forests are actually certified but no clarity on their certification systems How does EU exploitation of forests compare with their demands on PO producer countries? Obviously very little media exposure on these activities

5 EU: NET IMPORTER OF OILS & FATS Net Imports Production Consumption NET IMPORTER OF OILS & FATS This has further strengthened the role of the region as a net importer of oils and fats Palm is set to fill in the gap left between consumption and production 0 DEMAND FOR BIOFUEL BOOSTS LOCAL DEMAND Tallow & Grease 4% Olive oil 5% Others 7% Rapeseed oil 30% Import demand for oils and fats in this region has been on the increasing trend due to the shortage in domestic oils and fats production and the expansion of biofuels. Butter, as fat 6% Lard 7% Total MMT (2016) Source: Oil World, MPOC Soybean oil 7% Sunflower oil 12% Palm oil 22%

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7 Malaysia s Sustainability Initiatives and Commitments Through Malaysian Sustainable Palm Oil (MSPO) entire industry supply chain is targeted for mandatory certification end 2019 Certified Sustainable Palm Oil (CSPO) would become the norm rather than the exception. We will meet demands such as the Amsterdam Declaration, etc.

8 Efforts by MPOC via its Malaysian Palm Oil Wildlife Conservation Fund in conserving wildlife and biodiversity within plantation enclaves

9 Efforts by MPOC via its Malaysian Palm Oil Wildlife Conservation Fund in conserving wildlife and biodiversity within plantation enclaves Jungle Patrol with Sabah Forestry to reduce human wildlife interaction in key habitat areas adjoining to palm oil plantations Awareness program for plantation managements and workers: Biodiversity for Busy Manager Series Manual for Biodiversity Managers Satellite tracking to study population dynamics and ecology of Banteng in Sabah via a collaboration between MPOC and Danau Girang Field Centre of Cardiff University

10 The original and remaining extent of natural peatlands in Europe Western European countries have lost over 90% of their natural peatlands. The Netherlands has destroyed 100% of its natural peatlands as a result of agricultural and economic development. Peatlands in the Central and Eastern European region now occupy a frontier position. Data: H. Joosten and J. Couwenberg

11 Mechanized peat harvesting in East Friesland, Germany Worth remembering: European countries burn their peat at scale! Peat should be conserved wherever possible, in Europe, Asia, or elsewhere. But to know that countries like Finnland and Sweden every year use millions of tonnes of peat in heating does put things into perspective. Other countries like Germany still use peat widely for gardening purposes, although alternatives exist. The report Fuel Peat Industry in the EU [1] summarizes the situation as follows: The total annual peat use during the 2000 s has been 3,370 ktoe. The three largest users are Finland (59 % of total use), Ireland (29%) and Sweden (11%), corresponding to 99% of the total use. Peat is used in central heating power plants (CH) (45% of the total use), in condensing power generation (CP) (38%), district heating (DH) (10%) and residential heating (RH) (8%). The total number of power plants is 125. The approximate number of people receiving heating energy from peat is 1.94 million. The metric toe means ton of oil equivalent and as a unit of energy is defined as the amount of energy released by burning one ton of crude oil. Thus, 3,370 kilo toe are equivalent to burning 3.3 million tons of fossil oil.

12 Managing the NO Palm Oil labels throughout Europe Now evident of a huge proliferation of more than 1600 products throughout Europe Legal experts agree such labels are illegal but EU refuses to act on this matter Advertising now exploits No palm oil as a marketing opportunity Creating a Negative Myth around palm oil associated with health, sustainability and environmental damage.

13 excl. land use changes excl. land use changes Margarine (80% fat), from palm oil Sunflower oil Rapeseed oil Blend of palm, sunflower, rapeseed oil 60% fat, blend 40% fat, blend 80% fat, palm oil, LUC: peat soils, 25 yr 80% fat, blend, LUC: peat soils, 25 yr Palm oil, LUC: peat soils, 100 yr Blend, LUC: peat soils, 100 yr Palm oil, LUC: mineral soils, 25 yr Blend, LUC: mineral soils, 25 yr incl. land use changes 80% fat, allocation total milk solids 100% grassland 100% arable land Reduced fat (60% fat) Butter light (40% fat) Allocation fat content Allocation price Credits for by-products Max soy, rain forest, 25 yr Average soy, rain forest, 25 yr Average soy, rain forest, 100 yr Average soy, Cerrado, 25 yr Average soy, Cerrado, 100 yr incl. land use changes Palm oil, aluc Blend, aluc kg CO 2 -eq / kg margarine Agriculture Land use changes Processing Transports Packaging Logistics Shopping trip Refrigerator Max soy, aluc Average soy, aluc kg CO 2 -eq / kg butter Animal feed Methane Agriculture other Land use changes Processing Transports Packaging Logistics Shopping trip Refrigerator

14 Our Concluding Remarks & Take Home Message: Malaysia affirms its commitment towards supply of Certified Sustainable Palm Oil (CSPO) through its national MSPO standards by end Malaysian palm oil is open to greater inter-governmental collaboration and cooperation with NGOs and industry end users, especially those of Europe origin, to work towards common goals of sustainability and not impose punitive actions that are aimed at crippling our industry and economy.

15 THANK YOU