KUALA LUMPUR (Oct 31): The Malaysian Palm Oil Board (MPOB) is targeting more than 90% of independent smallholders to achieve Malaysian Sustainable Palm Oil (MSPO) certification by the end of next year.

MPOB director general Datuk Dr Ahmad Parveez Ghulam Kadir based his optimism on the fact that 76.9% of 210,891 independent oil palm smallholders licensed with the board are already certified under the MSPO standard.

The significant compliance rate, which presents a strong foundation for further compliance, was made possible by the MPOB’s initiatives, which include providing continuous financial and technical assistance, he said in response to queries by Bernama recently.

The MPOB also undertakes awareness campaigns on the importance of sustainability through targeted training programmes as well as by implementing the Sawit Intelligent Management System (SIMS).

“The SIMS aims to improve the monitoring of palm oil transactions, ensuring greater transparency and traceability throughout the supply chain,” he said.

The MPOB is also committed to supporting independent smallholders by providing full funding for the MSPO certification audit process, he said.

“This support includes training and supplying essential inputs, such as personal protective equipment and shelves for storing herbicides and pesticides.

“By alleviating these financial burdens, the allocation encourages independent smallholders to pursue sustainable palm oil production, thereby contributing to environmental conservation and economic stability within the oil palm industry,” he said.

The MSPO certificate ensures that plantation products, especially palm oil, are produced through sustainable methods, using processes that are environment-friendly and safe, complying with good agricultural practices.

Benefits from complying with such standards would enable Malaysian palm oil to be more marketable overseas, especially in developed markets such as the European Union (EU), which constantly demands compliance with such standards.

Many western countries including the EU have laws against buying palm oil linked to environmental issues like deforestation and wildlife destruction.

Nevertheless, the EU is an important market for Malaysia, being the third largest importer of palm oil after India and China, having imported 2.7 million tonnes of palm oil and palm oil products last year.

In Budget 2025, Prime Minister and Finance Minister Datuk Seri Anwar Ibrahim announced a RM65 million allocation to counter misunderstandings about palm oil at the international level, especially from the EU, a strategic move by the government to strengthen the Malaysian palm oil market.

Commodities and Plantations Minister Datuk Seri Johari Abdul Ghani said RM50 million of the RM65 million will be used for MSPO certification, with RM15 million going towards countering anti-palm oil campaigns.

Among the latest campaigns include the European Union Deforestation Regulation (EUDR), which could raise compliance costs among global palm oil producers to US$1.5 billion (RM6.57 billion).

Imposed by the EU, the EUDR is a non-tariff barrier which reportedly discriminates against Malaysia’s four major commodities — palm oil, rubber, timber and cocoa — by restricting open market access.

Ahmad Parveez said achieving sustainable practices could impose additional costs on both industry and the government, particularly for independent smallholders with limited resources.

Uploaded by Tham Yek Lee