The Edge Malaysia (03/11/2025) - KUALA LUMPUR (Nov 3): The European Union Deforestation Regulation (EUDR) risks squeezing palm oil out of global supply chains, as persistent bias and trade barriers continue to penalise producing nations despite their proven progress in protecting forests, said Malaysian Palm Oil Board (MPOB) chairman Datuk Mohamad Helmy Othman Basha.

He cautioned that persistent bias and restrictive rules could trigger a shortage in global supply, with top producers like Indonesia — the world’s largest palm oil exporter — diverting more output to meet domestic needs, including its B50 biodiesel mandate.

“The relentless negativity towards palm oil has resulted in some markets pushing it away. And so, the anti-palm oil folk may soon get their wish — the world is already seeing the steady disappearance of palm oil from the global market,” he said in his speech at the Annual Roundtable Conference on Sustainable Palm Oil (RT2025). 

Helmy, who is also the group managing director of SD Guthrie Bhd (KL:SDG), said the EUDR continues to unfairly penalise developing countries such as Malaysia and Indonesia despite their tangible progress in curbing deforestation. 

Citing data from the World Resources Institute and Global Forest Watch, he noted that Malaysia’s primary forest loss has fallen by more than 60% from its peak, while Indonesia has recorded consistent annual declines — with both nations maintaining over 50% forest cover, higher than many developed countries.

“Despite a record of declining deforestation and maintaining forest cover above 50%, Malaysia was given a ‘standard-risk’ rating under the EUDR, while countries with worse track records and lower forest cover were rated ‘low risk’. To some of us, it feels like the same old tune — victimise palm oil producers so others can continue doing what they always have done,” he said.

Helmy argued that applying uniform environmental standards across rich and poor nations is inherently unjust, calling it “economic apartheid”. Deforestation, he said, must be viewed alongside economic realities, as developing nations still rely on their natural resources to build infrastructure, create jobs, and sustain livelihoods.

“The only equitable and ethical solution is to allow poorer nations to use their natural resources responsibly. The quid pro quo? Every rich country with less than 50% forest cover must step up and start planting — or start paying underdeveloped nations to maintain theirs. There is no other way,” he said.

Helmy also criticised what he described as global hypocrisy, noting that while palm oil has long been painted as an ‘environmental villain’, fossil fuel producers — the largest direct contributors to climate change — often escape similar criticism under the banner of “energy security”.

“When fossil fuel use is excused under the name of energy security, sustainable palm oil is banned in the name of deforestation. The hypocrisy needs to stop,” he stressed.

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