As palm oil, cocoa and coffee producers prepare to implement new EU rules on deforestation, the governments of Malaysia and Indonesia say smaller producers need more time to comply with EU bureaucratic requirements.
The EU law came into force on June 29 this year and requires companies to monitor their supply chains and ensure that products placed on the EU market are not linked to deforestation.
Traders who focus primarily on meat, palm oil, soy, cocoa and coffee as well as raw materials such as rubber, wood or leather have until January 1, 2025 to implement the new rules.
Violations can result in their products being banned from the EU market, operators being fined and their products and profits confiscated.
Indonesia and Malaysia, the world's biggest palm oil producers, have reacted angrily to the EU's new anti-deforestation law, calling it "discriminatory and punitive in nature". In 2019, Jakarta complained to the World Trade Organization about the EU's plan to abandon palm oil as a feedstock for biofuels.
But the tone at last week's Euroactive debate was friendlier, with both sides showing a willingness to help producers implement EU legislation to combat deforestation.
“A large industry is ready,” said Rizal Afandi Luqman, secretary general of the Council of Palm Oil Producing Countries.
“But that is not the case with small farmers,” the official said, adding that small farmers have a weak supply chain.
According to CPOC, smallholders account for 41% and 27% of the total palm area in Indonesia and Malaysia, respectively, and are responsible for about 35-40% of global palm oil production.
Lukman said that especially low-income farmers living in remote areas need more time to train these people. He explained that access to information such as geolocation data would be difficult due to barriers related to education and digital literacy.
“It’s just a matter of time,” Luqman said, stressing that EU SMEs have until June 2025 to comply with EU anti-deforestation law.
“That's why I think it's fair if small farmers in producing countries also benefit from this delay,” he said at the Euractive event.
The representatives of Indonesia and Malaysia who spoke at the event expressed their desire to continue the open dialogue between EU bodies and palm oil producing countries and praised the work of the joint working group bringing together the producing countries and the European Union Commission . praised.
The task force, launched on June 29, aims to find a “win-win solution” to implement EU laws to combat deforestation and hopes to “prevent disruption” when the new law comes into force in January 2025 said Luckman. .
“We need to work with the supply chain of producing and consuming countries to find solutions to issues such as traceability,” Luqman said.
“I think we’re at a point where we’re looking for a solution,” he said.
Find “cleaning house”.
One solution being implemented by Indonesia is to set up a "clearinghouse" for palm oil producers where all information needed to comply with EU rules will be imported and sent to European customs authorities, Indonesia's deputy food minister said. said Musdhalifa Makmud. Nutrition. Agribusiness.
In addition to palm oil producers, the database is also available for other crops such as coffee, rubber, wood and cocoa.
“We don’t want small businesses to be confused about how many documents they need to fill out. That’s why we want to implement a program,” said McMood, calling for time to build the digital infrastructure.
Malaysia is supporting small businesses with capacity building training and certifications to help them comply with new EU regulations.
Traceability measures could be introduced to ensure that sustainable palm oil trade with the EU complies with EU requirements that palm oil certified with the Indonesian Sustainable Palm Oil Label (ISPO) “does not cause deforestation”. Complies with European standards.
However, activists question the feasibility of setting up an IT system to monitor small-scale palm oil producers in remote areas.
Gert van der Bijl, EU policy adviser at development NGO Solidaridad, said oil palm kernels are often traded after harvest and are often bartered before being sent to mills.
“Traceability for this type of farmer is very complicated,” he said, noting that compliance data must cover labor laws, tax laws and anti-corruption laws.
Van der Bijl said the risk was that large traders in Indonesia or Malaysia would stop buying from small farmers due to legal compliance issues that jeopardized their businesses.
The European Commission is aware of these problems.
Astrid Ladefogde, a senior official in the Commission's environment directorate, said working with producer countries to protect and restore the environment through the Global Forum shows "very real concerns" about keeping small businesses in the supply chain. Forests.
But while it is difficult to comply with European Union rules, it does mean that you have to follow and monitor large companies, not small companies.
“Some large companies have been committed for years to include small farmers in their sourcing strategy and to ensure that palm oil exported to Europe meets EU standards as part of their broader sustainability policies,” he said.
Ladefoged said that it was not mandatory to use the certification system to enter the EU market, pointing out that the question had been deliberately left open and that certification was important for some manufacturers but for others not.
An EU official previously told Euractiv that "most UDR obligations do not fall on farmers, but on operators bringing regulated products to the EU market." The Commission official downplayed the complexity, saying that geographical location requirements "come with a simple solution “smartphone”.
An open discussion is required
Van der Bijl said dialogue and bilateral cooperation are necessary to ensure proper implementation of the law.
“Ultimately what matters is that compliance with ADR requirements contributes to broader deforestation goals,” he stressed.
Using Peruvian coffee farmers as an example, van der Bijl says that one of the challenges is to increase the productivity of their existing land so that they can export coffee to Europe without destroying more forests.
“If we want to reduce deforestation, we need to work with farmers to increase productivity so they can produce sustainably. And I think that is ultimately important,” he said, explaining that bilateral cooperation will contribute to sustainable agricultural development in these countries.
Van der Bijl said that cooperation between the EU and producing countries must pay attention to the causes of deforestation. “And I think we need to talk more about poverty, government and powerlessness.”
“We will do our best to comply with the requirements,” said Dato' Haji Mad Zaidi Mohd Carli, secretary-general of Malaysia's Ministry of Agriculture and Natural Resources. “And let’s see, we still have twelve months left,” he said, hoping that there might be more “negotiation room” to bring small farmers on board.
“I have always wanted an open discussion about how to solve this problem, but any help from the EU in implementing the rules would be welcome,” he said.
Watch the full Euractive event here.
This article follows the political debate “ European rules for forest-free products – what consequences for small farmers? “, sponsored by CPOPC.
[Editing by Zoran Radosavljevic]
