​Malaysian Palm Oil Industry Goes on Charm Offensive

The Malaysian palm oil industry, through MPOGCF, plays an important role in handling the Malayan Tiger’s extinction crisis.

Update May 08, 2024

The Malaysian government's efforts to feature conservation work within its palm oil industry with the Malaysian Palm Oil Green Conservation appears to have paid.

Plantations and Commodities Minister Johari Abdul Ghani said Malaysia would offer gifts of orangutans to trading partners, particularly major importers such as the EU, India and China, as part of a diplomatic strategy.

"This will prove to the global community that Malaysia is committed to biodiversity conservation," Johari said on social media platform X late on Tuesday. Reuters

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• In case you haven’t noticed, the Malaysian palm oil industry is on a charm offensive.
• The campaign led by the Malaysian Palm Oil Green Conservation Foundation (MPOGCF) has been on a tear on a social media.
• Reforesting projects, preservation of iconic Malaysian wildlife in tigers and orangutans have all been featured in the media campaign.

This is not a new project by the Malaysian palm oil industry. The only thing new about it, is that the industry is ramping up its communications program to share the many initiatives on protecting wildlife in Malaysia in and beyond plantations.

What is the MPOGCF?
According to information on its website, the About US page says:

"The palm oil industry adopts and implements sustainable and good agricultural practices, yet it has been accused of unsustainable practices including the destruction of rainforests and wildlife habitat, particularly the orangutan.
The Malaysian palm oil industry has not been spared by these accusations, despite numerous efforts to provide explanation and correct information."

The fact is that the Malaysian palm oil industry has long allocated funding towards conservation. These funds were previously managed by the Malaysian Palm Oil Council (MPOC) as a conservation project under the Malaysian Palm Oil Wildlife Conservation Fund (MPOWCF). The project funded conservation projects in Malaysia, most notably, the Wildlife Rescue Unit in Sabah.

The Wildlife Rescue Unit’s work in protecting endangered wildlife from pangolins to elephants and orangutans is exemplary for a conservation group but its efforts were seldom acknowledged.

The birth of an orangutan in a foreign zoo, for example, gets more internet coverage on how these zoos are "saving endangered species" but the hard work in actually saving the entire species barely gets a mention from the same media. Yet Malaysian media reports like this one from Malaysiakini, shows the depth and breadth of the MPOWCF’s work in protecting biodiversity in Malaysia.

Banging A Gong on Deaf Ears

Despite the work of the MPOWCF and Malaysia’s commitment to stop deforestation for palm oil in 2019, the threats made against the palm oil industry from the European Union increased. The EU banned palm oil from its renewable energy program despite protestations from Indonesia and Malaysia.

This must have raised the concerns of the Malaysian government which under the advisement of the Ministry of Plantations and Commodities, created the MPOGCF to “prove the commitment of the industry towards conserving our environment.”

The MPOGCF has gone on a tear since, to prove that Malaysian palm oil is sustainably produced. Its social media accounts in Twitter, Instagram, Facebook and LinkedIn posts regularly on conservation initiatives happening in Malaysia.

Beyond social media, the MPOGCF’s media outreach has resulted in news publications of its conservation work from orangutans at the national zoo, to funding pest control at smallholder farms.

The MPOGCF’s media campaign may have reached deaf ears in Brussels as Malaysia protests the EU’s trade barriers in EUDR.

Going Green Beyond the EU

But Malaysia’s protest is not unique in being rejected by the EU. The brusque reaction from lawmakers in Brussels towards its own trade associations, which have a valid concern about the efficiency of EUDR, is telling about the bigger problems that the European Union faces.

According to Politico, the EU’s much touted “Green Deal” which the EUDR is part of, is facing a domestic crisis.

“the green sheen is fading, as twin food and energy crises inflamed by Russia's invasion of Ukraine embolden critics, from French farm lobbies to the bloc's own agriculture commissioner, who argue that the shift is too ambitious and will impose an uneven and unfair compliance burden across EU member countries.”

This has led to an existential crisis highlighted by Dutch farmers protesting the country’s move to reduce emissions from the agricultural sector.

The domestic squabbles in the EU is obviously beyond what the Malaysian palm oil industry can do against its biggest protagonist in the EU. There is no telling if EU farmers will elect pro-farming officials in 2024, the likes of which caused Total Energies to ban palm oil from its operations. What is known is the “Green Deal” is fading under pressure from European industries.

Going green for the Malaysian palm oil industry will matter to its major customers in India and China.

• The Solvent Extractors’ Association (SEA) of India has signed a memorandum of understanding (MoU) with small-holders of Sarawak State of Malaysia for supply of sustainable palm oil produce by them and expansion of market access for MSPO-certified (Malaysian Sustainable Palm Oil) oil from Sarawak palm oil small-holders in the Indian market.
• Malaysia, the world’s second-largest palm producer, and China, the world’s second-largest buyer, will jointly promote the use of Malaysia’s sustainable palm oil in China, as well as the design and implementation of new technologies such as artificial intelligence in oil palm plantations.

While the EU market is undoubtedly important to Malaysia, the fractionated state of the European Union with its overall hostility against agricultural imports, especially palm oil, has not deterred the Malaysian government from pushing a sustainability agenda for its palm oil industry.

The investments made by the Malaysian palm oil industry into the MPOGCF will start paying off in the short term as both India and China start asking for sustainably produced palm oil.

In the longer term, conservation programs supported by the Malaysian government through MPOGCF, will be important in evaluating the sustainability of Malaysian palm oil. The state-run Malaysian Palm Oil Certification Council (MPOCC) looks at environmental impact in the same way as third-party certification schemes for palm oil. What would make Malaysia stand out in sustainable palm oil production, is connecting the conservation work done by MPOGCF, to the overall program to make Malaysian palm oil sustainable.

This is critical for the credibility of Malaysia’s efforts to make its palm oil production sustainable as the MPOGCF shows that the Malaysian program extends beyond plantations, into the overall preservation of species in Malaysia in ex-situ locations.

National Certification and Conservation Programs Better for Consumers in Domestic and Foreign Markets

A new report by environmental scientists, Eric Lambin, and Paul Furumo, exposed the failure of corporate pledges to stop deforestation. Their suggestion was to tackle domestic markets.

"The trick is to tackle the domestic markets. For most commodities, the major exporting firms from the tropics are also active locally. The good news is that if those companies used the same deforestation-free supply lines for their domestic products as they do for, say, their exports to the EU, the potential impact could increase to cover about a third of all deforestation risk. That would be significant."

This suggestion may work well for producing countries that consume large amounts of what they produce but for it to work in Malaysia, which exports most of its commodities, the conservation work at the MPOGCF must regard India and China, as “domestic markets” as those consumers are being assured of environmental quality with certification from the MPOCC.

The European Union is not a lost cause for now as the conservation efforts undertaken by MPOGCF, could show the EU what needs to be done as the European Union seeks to restore nature in an environment where nature matters as much as agriculture.

Published July 2023. CSPO Watch