Abstract
The palm oil industry has contributed enormously to the economic growth of developing countries in the tropics, including Malaysia. Despite the industry being a development tool for emerging economies, the oil palm crop is inundated with allegations of its unsustainable plantation practices and viewed as environmentally detrimental and socially adverse. These negative perceptions are amplified through anti-palm oil campaigns and protectionist trade regulations in developed countries, particularly in the European Union (EU). This situation, if further exacerbated, could potentially affect the export of palm oil and the industry as a whole. As such, this article provides a critical review of the key sustainability issues faced by the Malaysian palm oil industry as the second biggest exporter of palm oil to the global market. The various insights and the interpretations of sustainability are contested according to the contexts and the interests of the countries involved. Hence, palm oil is constantly exposed to bias masked by non-tariff barriers from consumer countries to protect their domestically produced vegetable oils. This could constrain the commodity competitiveness in the international market. As issues on palm oil sustainability continue to evolve, policymakers at key stakeholder agencies need to devise strategies to manage global disruption in the palm oil trade.
Highlights
The rapid growth in the world population and the increase in demand for renewable energy, towards mitigating greenhouse gas (GHG) emissions, have resulted in the rise in demand for oilseeds
As a highly contested oilseed crop, palm oil dominates the discussion on sustainability compared to other vegetables in the oils and fats sector
The exchange of information on this commodity has been prevalent among palm oil-producing countries, palm oilconsuming countries, non-governmental organizations (NGOs), traders, manufacturers, growers, processing and milling facilities, associations, consumers, and policymakers in the past decades
Summary
The rapid growth in the world population and the increase in demand for renewable energy, towards mitigating greenhouse gas (GHG) emissions, have resulted in the rise in demand for oilseeds. This situation has contributed towards the expansion of oilseed cultivation, especially oil palm, in the tropical producing countries. As one of the major exporters of palm oil, Malaysia’s oil palm plantation area reached 5.87 million hectares, which supplied 34.3% of the total palm oil trade and constituted 18.3% (17.37 million tonnes) of the global oils and fats industry last year [1]. In order to fully optimize land usage for oil palm crops, palm oil research has been focused on sustainable plantation and development
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