Malaysia to Crack Down on Fraud in Used Cooking Oil Exports, Official Says
KUALA LUMPUR: Malaysia will crack down on fraud in the used cooking oil industry, its deputy plantation and commodities minister told Reuters, as western governments investigate whether shipments of the biofuels feedstock from Asia actually contain virgin oil.
Strengthening Enforcement Mechanisms
"The Malaysian Palm Oil Board (MPOB) is reviewing its standards and policies governing used cooking oil (UCO) and palm industry waste known as sludge palm oil (SPO) to better distinguish them in order to prevent discrepancies in exports," said deputy plantation and commodities minister Chan Foong Hin. "The government is also strengthening enforcement mechanisms to uphold industry credibility and Malaysia’s reputation as a responsible exporter."
Ensuring Traceability
"Ensuring that the entire supply chain is traceable would combat fraudulent practices," Chan added. "Basically, the centre of this issue is the traceability. How do you make the whole supply chain traceable?"
Combating Fraudulent Practices
The European biodiesel industry last year complained of a surge in imports from China it believed involved supplies declared as made with recycled oil and fat but actually produced with cheaper and less sustainable virgin oil. Neighbouring Indonesia, the world’s biggest palm oil producer, last month moved to curb exports of UCO and palm oil residue, saying that shipments in recent years had exceeded production capacity, indicating virgin crude palm oil (CPO) had been mixed in.
Deforestation Rules
Malaysia’s palm industry should not view the EU’s looming deforestation regulation negatively, according to Chan. "About 87% of Malaysia’s palm oil plantations are sustainably certified through the Malaysian Sustainable Palm Oil (MSPO) standards," he added. "In fact, we are ready."
Compliance with Regulations
In December, the EU approved a one-year delay to the landmark deforestation law requiring importers of soy, beef, cocoa, coffee, palm oil, timber, rubber, and related products to prove their supply chains do not contribute to the destruction of the world’s forests, or face hefty fines.
Optimistic about Demand
Chan downplayed a downturn in shipments to top palm oil buyer India, which hit a 14-year low in January, as a "short-term" situation given the demand needs of its 1.45 billion population. "The permanent factor is the population. So yes, we are still optimistic," Chan said.
Conclusion
Malaysia is taking a proactive approach to address concerns over fraud in the used cooking oil industry, ensuring that the country’s reputation as a responsible exporter is upheld. By strengthening enforcement mechanisms and promoting transparency throughout the supply chain, Malaysia can maintain its position as a reliable supplier of high-quality palm oil products.
FAQs
- What is Malaysia doing to address concerns over fraud in the used cooking oil industry?
Malaysia is reviewing its standards and policies governing used cooking oil and palm industry waste to prevent discrepancies in exports and strengthening enforcement mechanisms to uphold industry credibility and reputation. - What is the Malaysian Palm Oil Board doing to address the issue?
The MPOB is reviewing its standards and policies to better distinguish used cooking oil and palm industry waste, and to ensure the entire supply chain is traceable. - How does Malaysia view the EU’s deforestation regulation?
Malaysia’s palm industry should not view the EU’s looming deforestation regulation negatively, as the country is committed to anti-deforestation and has a high percentage of sustainably certified palm oil plantations.