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Trade politics fuel smear campaigns

BATTLE FOR MARKET SHARE: Attempts to defame palm oil via food labeling laws in Australia and Europe have manifested into trade barriers. With the United States of America (USA) making false allegations of child labour at the estates, industry veterans tell OOI TEE CHING that palm oil exports are being denied equal opportunities to trade.

IN 2009, France’s largest frozen food maker Findus announced it will remove palm oil from its products in favour of rapeseed oil. French retailer Casino, too, said more than 200 food products would be palm oil-free by the end of 2010. This would also apply to its other retail divisions like Franprix, Leader Price and Monoprix. Another French food retailer Auchan said it was working on ways to guarantee all its products were palm oil-free. 

British retail chain Marks & Spencer also campaigned against palm oil by putting up five-foot displays in its stores stating: “We think that destroying rainforest for palm oil is too high a price to pay for a biscuit.” 

Soon after, Australia proposed the Food Standards Amendment (Truth in Labelling — Palm Oil) Bill 2010. That bill was not passed. If it was, Australian consumers would have been misled into believing that palm oil was bad for health.

At present, palm oil is taxed €100 (or RM426) per tonne in France. In 2011, the French government proposed raising it to €400, so that foodstuff containing it, like Nutella, the popular chocolate spread, would become very costly. The proposal was shot down.

In March 2013, Dutch Board for Margarine, Fats and Oils head Frans Claassen reportedly said negative campaigns could force food companies to replace palm oil and therefore cut its imports. The European Union’s (EU) palm oil imports account for 10 per cent of global production, and nearly half are shipped in via the Netherlands.

Since 13th December 2014, the EU Food Information for Consumers Regulation had mandated specification of vegetable oils (i.e. palm, rapeseed, sunflower, soya) on the ingredient list. 

But food companies had also printed “No Palm Oil” on the front labels, which insinuates that palm oil is bad and needs to be avoided. Today, French chocolate maker Galler and supermarket chain Delhaize are displaying “No Palm Oil” labels on their food packaging.

Malaysian Oil Scientists and Technologists Association president Tan Sri Augustine Ong looked despairingly at photographs of infant milk at a supermarket in Singapore with “Palm Oil Free” signages. 

He shook his head. “It has come to this part of the world, too. This is defamatory. The public is being misled into believing that the saturated fats in palm oil are bad when in reality, they are a necessary part of a balanced diet.” 

A former Malaysian Palm Oil Board director-general, Ong recalled the first attack on palm oil’s reputation in the 1980s when outraged American industrialist Phil Sokolov suffered a heart attack and blamed it on palm oil consumption.

Sokolov started a campaign called “The Poisoning of America” that featured nationwide full-page newspaper advertisements describing the dangers of saturated fats in palm oil. His supporters insisted that palm oil consumption increased blood cholesterol levels and heart disease risk — a misconception that still looms to this day.

Ong acknowledged that palm oil contains a higher percentage of saturated fats compared with soft oils such as olive, soya, rapeseed and sunflower. But it must also be highlighted that half of palm oil is monounsaturated and polyunsaturated — known to increase good cholesterol and benefit the cardiovascular system.

Since the 1980s until now, Ong noted there have been studies proving the hydrogenation of liquid oil into spreadable margarine is the real trigger in raising risks of cardiovascular diseases. 

“The truth is, palm oil does not contain cholesterol and saturated fats are a necessity in our daily diet. The real villains in cardiovascular diseases and diabetes are the artificial trans fats brought on by hydrogenation of soft oils to make margarine.”

He said there are more than 150 studies proving that tocotrienols, vitamin E variants in palm oil, lower bad cholesterol.

Ong noted it is not a coincidence that defamatory campaigns on palm oil originate from rival oil-producing continents which have lost global market share to palm oil, as Malaysia and Indonesia expanded their oil palm plantings. 

Next year, global palm oil output is expected to total 63 million tonnes while soya and rapeseed oils are seen to touch 47 million tonnes and 27 million tonnes, respectively. 

In the 15 years to 2015, Oil World and other authoritative statistics show global palm oil output expanding two times faster than soya and rapeseed oils. 

The world’s top soyabean producer is USA while the world’s number one rapeseed producer is the EU. 

“As more discriminatory measures are imposed on the palm oil industry, exporters from Malaysia and Indonesia are denied equal opportunities to trade,” said Ong, adding that green activists’ smear campaigns deny smallholders of decent livelihoods and consumers of a healthy alternative to trans fats.

Next year, the US expects to reap 108 million tonnes of soyabeans and the EU targets to harvest 23 million tonnes of rapeseed.

These oilseeds are crushed for their oil and the solids are processed into animal feed. Typically, 100 tonnes of soyabean yield 15 tonnes of soya oil. Likewise, 100 tonnes of rapeseed yield 40 tonnes of rapeseed oil.

Australia is the world’s second-largest rapeseed exporter, shipping 2.12 million tonnes a year, mostly to the EU.

The world’s dominant traders, Archer Daniels Midland and Cargill, which are big beneficiaries of the EU farm subsidy under the Common Agricultural Policy, are the buyers of Australian rapeseed feeding into the EU biodiesel pipelines.

Incorporated Society of Planters chief executive officer Azizan Abdullah concurred with Ong that the green activists’ defamatory campaigns against the palm oil industry are very much fuelled by trade politics of the world’s top soyabean and rapeseed producing continents.

On the US Department of Labour’s recent claim that Malaysia’s palm oil industry engages child labour and forced labour, Azizan said: “The credibility of these claims is questionable.”

He pointed out that Plantation Industries and Commodities Minister Datuk Amar Douglas Uggah Embas had refuted allegations of child labour while adducing a comprehensive survey on the labour situation in the estates.

Based on International Labour Organisation guidelines, the study covered workers, employers and labour contractors across 68 oil palm plantations and smallholdings.

A total of 1,632 workers in Selangor, Perak, Johor, Pahang, Sabah and Sarawak were interviewed without the presence of their employers.

In Sabah, this study revealed some of the foreign workers’ children occasionally tag along to the fields. Even then, the children are only allowed to do so after school , on weekends or during school holidays. They help their parents in simple tasks, such as collecting loose fruits.

The study concluded there is no systemic forced labour or child labour in the plantation industry. 

“The way I see it, the children are filial to their parents. On the other hand, oppression is unjust use of power to impose an unequal relationship and deny another’s rights or value. The real victims of trade oppression here are the planters,” he said.

“Why should planters’ rights to grow oil palms and rubber on their land be dictated by coercive terms and conditions imposed by western economic powers? These manifestos hurt the livelihoods of millions of planters in Malaysia, Indonesia, Papua New Guinea and Africa.

“Why are tropical planters being denied their rights to re-invest for the future earnings of their investors?” asked Azizan.

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