On 16 July, Malaysia announced its intention to file a complaint with the World Trade Organisation (WTO) against the European Union regulation to remove palm oil from European biofuels by 2030.
Last April, Malaysia, Indonesia and three other palm oil producing countries already asked the EU to suspend the implementation of the provisions restricting the use of certain palm oils in biofuels at a meeting of the WTO Council for Trade in Goods (see EUROPE 12237/27).
The offices of the Malaysian Minister of Justice is currently drafting the complaint and the country hopes to be able to work with Indonesia on this matter.
Moreover, on 12 July, Indonesian President Joko Widodo confirmed that he intended to fight against the European policy aimed at reducing the use of palm oil "because it affects 16 million farmers and workers in this sector".
Indonesia is the world's largest producer. Between them, Indonesia and Malaysia account for 85% of world production. However, the cultivation of oil palm in Indonesia is causing massive deforestation in the country.
The main purpose of the delegated act defining raw materials intended for the production of biofuels at high risk of indirect land use change (ILUC), which entered into force at the beginning of June, is to limit the use of palm oil in biodiesel in the EU by 2030 (see EUROPE 12213/26).
A review in 2021. Biodiesel produced from uncertified palm oil can no longer be included in the EU's renewable energy targets. The scheme still provides for a number of exemptions for small farms of less than 2 hectares and for palm oil produced on abandoned or degraded land.
By June 2021, the European Commission will review the effects of this Regulation on the cultivation of the raw materials concerned and the provision on smallholders. Approximately 50% of palm oil imports into the EU are intended for biodiesel production. (Original version in French by Lionel Changeur)