Indonesia and Malaysia, the world’s top palm oil producers which account for some 85 percent of global supply, have decided not to take part in the workshop on Indirect Land Use Change (ILUC) held by the European Union as part of the formulation of its Renewable Energy Directive II.
Indonesia and Malaysia, both members of the Council of Palm Oil Producing Countries (CPOPC) “will not participate in the workshop linked to the Indirect Land Use Change which is part of the European Union’s Renewable Energy Directive II because it is deemed to be very discriminative against palm oil products in the European market,” press release of the Indonesian Coordinating Ministry for the Economy obtained here on Friday (9/11) said.
The workshop is being scheduled to be held in Brussels later this month.
Indonesian officials have aired concerns that the European Union will use the ILUC criteria to gradually halt or restrict the use of palm oil-based biofuel. CPOPC Executive Director Mahendra Siregar told a recent conference on palm oil in Bali earlier this month that ILUC was not an internationally-recognized and tested parameter and was only used by the European Union and the United States.
He also said that the use of the ILUC criteria could keep Indonesian palm oil biodiesel out from Renewable Energy Directive II and literally close the European Union market to the commodity. Such moves, he said, would be in contraversion of the international rules and agreements, including those of the World Trade Organization (WTO).
The European Commission is currently working on criteria that would classify as either high risk or low risk, for ILUCs. This is where Indonesia’s concern lays, with officials pointing out the under such classification, Indonesian palm oil would come as a high ILUC risk.
EU Ambassador to Indonesia and Brunei Darussalam, Vincent Guerend, told the same conference in Bali that the European Union would consult producing countries, including Indonesia and Malaysia, in preparing the ILUC criteria but also added that the final word would, of course, remain with the Union.