The Case of WENGOs Blindly Pushing for Labelling of Palm Oil

I was invited by the Senate Committee on Community Affairs in Canberra, Australia to give a testimony on the mandatory labeling of palm oil proposed under the Truth in Labeling – Palm Oil Bill. It seems that palm oil is now a target not only of Western Environmental NGOs (WENGOs), but also some ambitious Green Politicians of the developed world. On reflection, the WENGOs could be accused of taking the issue too far without thinking how their actions and allegations are un-justified and how these may affect the livelihoods of poor oil palm farmers in developing countries such as Malaysia and Indonesia.

I would not blame the Green Politicians for their lack of knowledge on the oil palm industry; the utterances that they made to support the Bill in Canberra clearly revealed their ignorance. They claim for example, that palm oil is a ‘fruit’ oil and should not be labeled as a ‘vegetable’ oil. Obviously, the WENGOs have diligently fed their Green Senators with the necessary cannon powder to debate on the Bill, but it was soon pointed out at the hearing that olive oil, produced as a fruit oil in the EU and Australia is also classified internationally as a vegetable oil because it comes from a plant or vegetable source as opposed to animal fats which come from animal sources.

Sustainability: New Market for Certified Sustainable Oils and Fats?

Confusion reigns over certified and uncertified oils

In recent years, the Western Environmental NGOs (WENGOs) together with producers and buyers of palm oil have attempted to promote the development and market for certified sustainable oils and fats products in addition to existing non-certified products. This has resulted in two types of market for oils and fats: the certified sustainable oil market and the market for normal oils that are not certified. The most desirable and ideal market is of course one where the oils and fats products are proven to be sustainably produced. The proof is via a certification and auditing process where the oils or fats which are found to comply with a set of sustainability principles and criteria will be issued certificates attesting to their sustainable production and processing. These products are supposed to be marketed at a premium to meet the needs of sophisticated markets especially in the EU. In the case of palm oil, such products are referred to as Certified Sustainable Palm Oil in general or Certified RSPO palm oil (CSPO) if the RSPO system is used as the basis for auditing and certification. In contrast, the main market is still mostly for non-certified normal palm oil. Such products cannot be marketed as sustainable as the WENGOs will protest that there is no proof of sustainability. Neither can it be labeled as unsustainable palm oil as there is no proof for that either.Unfortunately, Certified RSPO palm oil has received limited acceptance thus far. The available capacity in Malaysia of about 1 million tonnes of CSPO palm oil has not been fully taken up. Only 30 % of the potentially available RSPO palm oil has been exported to the EU. The main excuse is the lack of willingness of the importers to pay a premium to offset the initial cost of certification. To make matters worse, some of the WENGOs are casting doubts on the ability of RSPO members to supply sustainable palm oil.