Thursday, September 01, 2011

Why only palm oil?

By Zaidi Isham IsmailPublished: 2011/08/31

THE next time you go to the shopping mart to buy a food item, take a look at the ingredients label.

Chances are it will say the generic term vegetable oil rather than soyabean, rapeseed or palm oil.

Labelling of vegetable oils in the US, Europe and Malaysia has been accepted as the industry norm due to health reasons.

However in other parts of the world, such as Australia and New Zealand, the vegetable oils labelling is not carried as there are no laws requiring food manufacturers to do so.

Since 2009 however, some of Australia's lawmakers have been taking steps to change all that. They want to ask food manfucturers to specify the vegetable oil content, especially palm oil.

This has riled up Malaysia, which sees the move as unfair and discriminatory and can be seen as a non-tariff barrier on palm oil.

Plantation Industries and Commodities Minister Tan Sri Bernard Dompok said it is okay to label palm oil on food products but Australia must compel other vegetable oils to do the same.

The playing field must be fair.

"Why just palm oil? What about the other oils? if you just single out palm oil, people will be asking, what's wrong with this product? We want to put things right from the start. Palm oil poses no danger to health at all."

Isn't it good to label palm oil? The oil is already known for its health benefits. So what is there to fear?

No problem, if the labelling is based on health grounds.

But Malaysia sees the whole labelling issue as a front by the non-governmental organisations to weed out which food manufacturers use palm oil and which do not.

Once it is able to identify the company which uses palm oil, it will launch an attack on the food company to stop its imports, like what they did to Cadbury and Kit Kat.

Their campaigns were so intense that both companies have stopped using palm oil.

NGOs will also link palm oil to forest degradation and the destruction of orang utan habitats.

It is because of this, Dompok led a 10-day trade mission last July to woo Australian parliamentarians not to support the initiative.

The Australian Parliament is due to convene this September to debate the "The Truth in Labelling - Palm Oil Bill", passed last month by the senate and is now on its way to the house of representatives.

The Bill is spearheaded by the independent senator Nick Xenophon and has received strong support from the Greens, the World Wildlife Fund, Zoos Victoria and Greenpeace as well as crucial backing in the senate from the coalition.

Dompok said the Malaysian Government will continue to negotiate with Australia's lawmakers by sending envoys in the coming months to talk them out of it.

Dompok said the Bill threatens the livelihood of 570,000 smallholders in plantations and a further 290,000 in downstream industries.

Out of the four million hectares of oil palm estates in Malaysia, 40 per cent is handled by smallholders.

"The industry has helped a lot of our people to come out of poverty. We have almost reached the point where we can't go much further with palm oil plantations," said Dompok.

He said Malaysia, which has national parks and world heritage sites, is very conscious of its need to preserve its own forests, which cover 55.7 per cent of its total area, well above the 50 per cent it guaranteed to retain at the 1992 Rio de Janeiro Earth Summit.

Besides arguments by NGOs that it destroys the habitat of Malaysia's 11,000 orangutans are baseless as the primate can only be found in Southeast Sabah and Southern Sarawak, which has been gazetted as forest sanctuary and are far from oil palm estates.

There are no orang utans in Peninsular Malaysia.

Malaysia's land used for agriculture, including for palm oil, is governed by strict laws and must be registered and licensed by the Malaysian Palm Oil Board.

"The move to label and and penalise palm oil has the potential to reverberate globally," said Dompok.

He said the labelling will also be cumbersome to Australia's food makers which can cost up to A$60,000 (RM186,000) just to label palm oil on a single food item.

Dompok said the government is deeply disappointed that the Liberal, National and Greens parties and Senator Xenophon have chosen to put politics ahead of the mutually advantageous relationship between Malaysia and Australia.

"This legislation undermines the spirit of our co-operation, especially now when our two countries have forged an asylum seeker deal."

All is not lost for Malaysia however. Should the Bill be passed, Malaysia can take up the battle at the World Trade Organisation where Malaysia can present its case against Australia's discriminatory move on palm oil.

Malaysian Palm Oil Council chief executive officer Tan Sri Dr Yusof Basiron said Malaysia has to fight all the way as NGOs are using Australia and New Zealand as their testing ground to see whether the Bill can be passed.

"Should it be passed, the NGOs know that if they can do it in Australia, it can also be done in the US and Europe," said Yusof.