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Newly-implemented Malaysian Sustainable Palm Oil means more business
The newly-implemented Malaysian Sustainable Palm Oil (MSPO) certification standard this year has garnered strong support from both domestic palm oil industry players and exporters alike
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he newly-implemented Malaysian Sustainable Palm Oil (MSPO) certification standard this year has garnered strong support from both domestic palm oil industry players and exporters alike.
Even though MSPO affiliation is currently on a voluntary basis, many Malaysian plantation companies which have obtained other certification ' namely the Roundtable on Sustainable Palm Oil (RSPO) and the Indonesian Sustainable Palm Oil (ISPO) ' have expressed strong interest in acquiring this national certification for certified sustainable palm oil (CSPO).
The MSPO is the third such certification standard in the world for palm oil, after the ISPO launched in 2011, and the multi-stakeholder grouping RSPO set up in 2004.
By securing both international and domestic CSPO certifications, palm oil industry players opine that it would ensure sustainable practices in the estates and palm oil exported from Malaysia are certified sustainable, as dictated by importing nations particularly the European Union and the United States.
Focus on small players
Dr Ainie Kuntom, a senior research fellow for product development and advisory services division of the Malaysian Palm Oil Board (MPOB), points out that the focus this year would be the implementation of the MSPO scheme for smallholders as well as small and medium oil palm planters in the country.
The local palm oil custodian is also pushing hard for MSPO certification to be recognised by the importing countries, and to obtain endorsement of the MSPO scheme for the Accreditation of Certification Body (ACB) for oil palm management system along the supply chain by Standards Malaysia.
At the Reach & Remind Friends of the Industry Seminar 2015 & Dialogue organised by the Malaysian Palm Oil Council at the Putrajaya Marriot Hotel recently, Dr Ainie says activities to be carried out this year include assisting SME producers and smallholders to implement MSPO requirements, MSPO briefings to oil palm companies and dealers, MSPO lead auditor course, technical advisory services (TAS) meetings with authorities of importing countries, and MSPO roadshows overseas.
'However, all these planned activities are subject to changes, should the government decide to establish a new body to govern the MSPO,' she says.
Currently, the MPOB acts as the governing body for MSPO. However, the governing body in future is expected to be a separate entity, she says, while the MPOB becomes the owner of the standard.
Dr Ainie says the MSPO standard which is developed along the Sustainable Agriculture Practices and the three elements of sustainability ' people, planet and profit ' will also be up for review in 2018.
Rise in CPO prices
RSPO technical director Salahuddin Yaacob says the CSPO uptake in 2014 increased to 5.35 million tonnes, from 4.5 million tonnes in 2013.
'CSPO uptake has climbed steadily over the past six years, from a mere 4,452 tonnes when it was first exported in 2008,' he says.
This increase is on the back of higher CSPO supply at 11.9 million tonnes last year versus 9.7 million tonnes a year earlier.
Indonesia ' the world's largest palm oil producer ' produced 33.5 million tonnes of crude palm oil (CPO) last year, of which 5.9 million tonnes are CSPO.
Malaysia, the world's second largest CPO producer at 20.35 million tonnes, produced 5.02 million tonnes of CSPO.
Of the total global CPO production at 62.35 million tonnes in 2014, CSPO make up 19.2 per cent or 11.9 million tonnes.
Global companies, of which some are members of the RSPO such as Carrefour, Walmart, Unilever, Nestlé, Johnson and Johnson, P&G, Mondelez International and Ferrero, are committed to 100 per cent RSPO-certified sustainable palm oil, says Salahuddin.
To date, the total number of RSPO members stands at 2,081 ' from oil palm growers, palm oil processors and traders, to retailers, consumer goods manufacturers, banks and investors as well as environmental and social non-governmental organisations.
Salahuddin points out that the RSPO trademark, which was launched in 2011, is currently registered or pending registration in over 60 countries.
Given the increasing palm oil use globally, the RSPO has also envisaged that palm oil consumption is set to grow to 77 million tonnes in 2050, from 50 million tonnes in 2011. (***)
