MPOC: EU Must Now do The Right Thing, and Delay EUDR

The following is a statement from Belvinder Kaur Sron, Chief Executive Officer of the Malaysian Palm Oil Council.

“The EU Commission should now do the right thing, and listen to the ever-growing calls for a delay to the EUDR. A delay is now the only way to ensure small farmers are supported, to provide stability for businesses, EU Member States, and governments around the world, and to avoid a chaotic implementation of EUDR in January 2025.”

Malaysia has consistently urged the European Union authorities, and other stakeholders, to recognise that the EUDR discriminates against the developing world, that the implementation date of 30^th December 2024 is unworkable, and that a delay is needed.

Other governments, industries and experts have supported this position, both inside the European Union and in other countries around the world. Developments this week in Europe itself have lent further support to the calls for a delay.

EUDR is a non-tariff barrier that will add significant administrative costs and burdens, and risks excluding smallholders from the EU supply chain altogether. The EU also has not provided clear guidelines for compliance, even though the implementation deadline is in less than 4 months.

The EU must urgently undertake the following steps to address the flaws of the EUDR:

• Provide a genuine and wide-ranging exemption for smallholders to prevent their exclusion from supply chains
• Publish specific and credible criteria, so that proven sustainable commodities such as Malaysian palm oil can be identified as ‘low risk’
• Accept the Malaysian Sustainable Palm Oil (MSPO) standard as a compliance tool for EUDR to ease market access for proven zero-deforestation palm oil

Background on EUDR:

• EU Deforestation Regulation (EUDR) is a non-tariff barrier targeting commodities, including palm oil. It requires all imports to the EU, from 30^th December 2024, to provide huge quantities of data including on geolocation, ‘polygon’ mapping of plantations, due diligence statements, and other burdensome administrative requirements
• Small farmers of palm oil in Malaysia could be forced out of supply chains because they do not have the technical capacity to provide all of the data demanded by EUDR
• Glenauk Economics estimates the cost of EUDR for the palm oil sector to be $650million annually, with $260m of costs burdening small farmers specifically
• Malaysia’s MSPO standard already guarantees legality and zero-deforestation commitments, while also supporting small farmers. Accepting MSPO is a better route for the EU to ensure its environmental objectives.

Global Concerns 

• German Chancellor Olaf Scholz this week asked the EU to delay the implementation of EUDR
• Seventeen developing and middle-income nations from Asia, Latin America and Africa all signed a letter to the EU Commission expressing concerns about the EUDR
• The Biden Administration urged the EU to delay the EUDR, stating that Brussels “has not provided clear implementing guidance”
• 20 of the EU’s 27 Agriculture Ministers supported an effort to delay EUDR due to implementation concerns inside Europe
• Peter Liese MEP, the leading center-right EPP MEP on the Environment Committee, has publicly supported the need for a delay to EUDR implementation
• NGO FairTrade said that it is “very concerned that producer organisations will be cut off from trade with the EU market or pushed out of supply chains”as a result of the EUDR
• New York Times criticised EUDR because “lower- and middle-income nations are being compelled to bear the cost of ruinous environmental shifts caused mostly by the world’s wealthiest nations.”
• Malaysia’s Prime Minister Anwar Ibrahim said he planned to “fight discrimination against palm oil” in further discussions with the EU
• Dr Anna Jerzewska, founder of Trade and Borders, has concluded: “We all agree that EUDR if implemented in December will be a complete disaster, right? I mean no one actually thinks we’re ready?”