PUTRAJAYA: Financial aid is being prepared for smallholders by June 2017 to push for the implementation of the government-driven Malaysian Sustainable Palm Oil (MSPO) certification.
The MSPO is essentially a reflection of a unified code of laws concerning best practices throughout the supply chain, from oil palm planting to palm oil processing.
“The MSPO certification will be made mandatory. We want this to be carried out in stages from 2018 onwards,” said Plantation Industries and Commodities Minister Datuk Seri Mah Siew Keong.
“I know making MSPO mandatory is tough and can be very costly for some 550,000 smallholders. We want to raise the standards, the level of best practices across the whole industry,” he told reporters after hosting a meeting with European Union lawmakers on the progress of MSPO certification here today.
The European Union is the second biggest market for Malaysian palm oil. In 2016, Malaysia’s export of palm oil and palm-based products to the EU was recorded at RM10.30 billion, an increase of 4.14 per cent from RM9.89 billion in 2015.
Mah noted getting all oil palm planters in Malaysia MSPO-certified is tough but necessary for the long term prospects of the industry.
“The government assures the implementation of MSPO will be practical. Financial aid will be made available for smallholders by the middle of this year,” the minister said, adding smallholders must implement the MSPO by December 2019.
Oil palm planters who are certified under the business-to-business Roundtable Sustainable Palm Oil (RSPO) scheme will be required to implement the MSPO certification by 31st December 2018.
“Plantation companies who are RSPO-certified will have to implement MSPO certification by 31 December 2018,” the minister said.
“For those without RSPO certification, they will need to implement MSPO by 30th June 2019,” he said, adding the government wants to promote premium pricing for the value add that goes into this initiative.
The objective of the MSPO is to facilitate better palm oil market access through multilateral or bilateral free trade agreements with buyers.