8 March 2024

2 minute learn

Palm oil producer Golden Agri Assets (GAR) intends to take care of its exports to the European Union at round 800,000 metric tons subsequent yr even after the EU’s landmark new deforestation regulation takes impact, Reuters reported, citing an organization official.

The European Parliament permitted a legislation final April that may ban imports of seven commodities together with palm oil, soyoil, and beef if they’re linked to destruction of the world’s forests.

“We need to proceed buying and selling within the EU. It isn’t the most important of our export markets but it surely is a crucial one – clearly, a premium-paying one. We need to keep in that house,” Anita Neville, the agency’s chief sustainability and communications officer, mentioned in an interview in Kuala Lumpur this week.

Singapore-based Golden Agri exports 700,000-800,000 tons of crude palm oil and laurics to the EU yearly, which represents 10% to fifteen% of its income, she mentioned.

The corporate believes that it is own-sourced palm oil is compliant with the EU Deforestation Regulation (EUDR), and has traceability instruments in place, Neville mentioned.

It’s arranging its provide chain, together with rerouting vehicles and making ready separate vessels to segregate EUDR criticism merchandise from these with out proof of land legality, geolocation, and that they’re deforestation-free.

“GAR has been engaged on making ready for EUDR for 2 years and we really feel moderately assured that we’re properly positioned to conform to EUDR,” she mentioned.

Whereas Golden Agri will prioritise its personal merchandise when EUDR takes impact on Dec 30 this yr to make sure compliance and keep away from monetary penalties, in the long run it wants its smallholder suppliers to assist meet demand, particularly for palm kernel oil.

“To attain excellent compliance from day 1, you will notice some individuals excluding smallholders due to the extent of threat,” Neville mentioned.

However, she added, “this rule isn’t going away.”

“So we additionally should be pondering how we construct our system and alternative to carry extra smallholders in day 21, 51, and so forth,” Neville mentioned, including that the corporate is engaged on lists of compliant third events.

The world’s two greatest palm oil producing international locations, Indonesia and Malaysia, have voiced issues that the deforestation legislation could possibly be detrimental to small farming companies.