Statement from MPOC on EUDR Delay

MEDIA STATEMENT

MPOC: DELAY TO EUDR IS THE RIGHT DECISION

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

“The EU Commission’s announcement that EUDR implementation will be delayed until 30^th December 2025 is the right decision. This is a victory for common sense, and a welcome relief for all of those businesses who highlighted the need for a delay.

“Malaysian palm oil exporters are able to comply with EUDR: this is not in doubt. Malaysia’s commitment to zero deforestation is written in law. The MSPO standard is the world’s leading mandatory palm oil certification scheme. Malaysia is ready to supply EUDR-compliant, sustainable and traceable palm oil to our European customers.

“This delay is a sensible decision to ensure that supply chains around the world have the time to prepare the technical and bureaucratic processes demanded by EUDR.”

Malaysia has over the past 2 years consistently provided evidence to the European Union authorities and other stakeholders, that the implementation date of 30^th December 2024 was unworkable, and the EU systems were not ready.

Other governments, industries and experts supported this position, both inside the European Union and in other countries around the world.

A chaotic implementation of EUDR has now been avoided, to the benefit of both European consumers and Malaysian exporters.

The 12 month delay also now provides an opportunity for the EU to improve EUDR to meet the genuine concerns of many partners, including Malaysia. This should include:

• A genuine and wide-ranging exemption for smallholders to prevent their exclusion from supply chains
• Fair and transparent benchmarking criteria so that proven sustainable commodities such as Malaysian palm oil will 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 to provide huge quantities of data including on geolocation, ‘polygon’ mapping, due diligence statements, and other burdensome administrative requirements. The EU has now announced a delay, and EUDR will now be implemented on 30^th December 2025
• 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 Pressure Led to EUDR Delay

• In December 2022, senior Malaysian officials publicly opposed EUDR, correctly predicting it would lead to supply chain chaos
• Malaysia’s Prime Minister Anwar Ibrahim said he planned to “fight discrimination against palm oil” in further discussions with the EU
• Malaysia and sixteen other developing and middle-income nations from Asia, Latin America and Africa all signed a letter to the EU Commission expressing concerns about 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.”
• German Chancellor Olaf Scholz asked the EU to delay the implementation of 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

BELVINDER KAUR SRON
CHIEF EXECUTIVE OFFICER
MALAYSIAN PALM OIL COUNCIL