Un­der EU at­tack, top palm oil pro­duc­ers Malaysia, In­done­sia re­think trade strat­egy

Business World - - AGRIBUSINESS -

FAC­ING a back­lash in Europe over palm oil’s en­vi­ron­men­tal toll, the world’s top pro­duc­ers are scram­bling to find new mar­kets and even strik­ing un­usual barter deals, such as ex­chang­ing Rus­sian Sukhoi jets for the ed­i­ble oil.

The Euro­pean Union is the sec­ond-largest palm oil ex­port des­ti­na­tion af­ter In­dia for both Malaysia and In­done­sia, which dom­i­nate pro­duc­tion in a global mar­ket worth at least $40 bil­lion.

But palm has come un­der in­creas­ing fire in Europe over its im­pact on for­est de­struc­tion, en­cour­ag­ing pro­duc­ers to look at new mar­kets rang­ing from Africa to Myan­mar.

Threat­ened by crum­bling de­mand in Europe, the in­dus­try is wag­ing a pub­lic re­la­tions bat­tle and push­ing pro­duc­ers to en­ter more price- sen­si­tive mar­kets, where In­done­sia should have an ad­van­tage over Malaysia due to its lower pro­duc­tion costs.

“Our prin­ci­ple is we will not let go of even one tonne of trade con­tract or po­ten­tial de­mand palm has glob­ally,” In­done­sia’s deputy Co­or­di­nat­ing Min­is­ter for Eco­nomic Af­fairs Mus­d­hal­i­fah Mach­mud told Reuters.

Mach­mud said palm oil sales were be­ing brought up in “ev­ery trade ne­go­ti­a­tion” In­done­sia con­ducts.

Palm oil is used in thou­sands of house­hold prod­ucts, from snack foods to soaps, as well as to make biodiesel. —

Newspapers in English

Newspapers from Philippines

© PressReader. All rights reserved.