Malaysia: Arbitrary decision to stop palm oil export to EU is futile attempt

RBD Palm Oil

Malaysia

Published Jan 13, 2023

Tridge summary

Analysts who spoke to The Edge cautioned that taking an all-out offensive approach such as halting palm oil export to the European Union (EU) in retaliation for the bloc’s proposed Deforestation Regulation is not an economically responsible move. Deputy Prime Minister Datuk Seri Fadillah Yusof on Thursday (Jan 12) said the government is mulling a total export ban as it treats the EU’s new regulation as an intentional trade barrier.

Original content

KUALA LUMPUR (Jan 12): Fadillah, who is also the plantation industries and commodities minister, said he will further discuss the matter with Indonesia, adding palm oil producers must not act alone in facing these challenges. Responding to Fadillah’s announcement, Singapore-based Palm Oil Analytics co-founder Sathia Varqa said such retaliation will disrupt the market as most of the palm oil deliveries for the months ahead are already traded at predetermined prices. “Governments cannot take such a confrontational approach on these issues. Considering or imposing any bans will create unnecessary chaos in the market which is already running like a well-oiled machine. “Banning will not address nor fix the problem. So what is the government going to do with all the EU buyers who have booked palm oil cargo in the future for June, July and August? Most actively traded product delivery period for palm oil is usually in April, May and June. Buyers are not buying palm oil now for tomorrow ...

Source: Theedgemarkets