10 August 2016: Malaysia, Indonesia to counter black campaign

27 July 2016: Awaiting CPOPC impetus

25 April 2016: Critique of CPOPC-agribusiness  “right to develop”  stance?

Commentary: Palm Oil Politics Impede Sustainability in Southeast Asia - Indonesia has facilitated the inflow of Malaysian capital and technology. Malaysian companies control 25 percent of oil palm plantations in Indonesia. By Rob Cramb & John McCarthy | on April 20, 2016... Indonesia and Malaysia are at the center of the world’s decades-long palm oil boom. Between them the two countries have planted more than 15 million hectares of oil palm, employ about 4 million workers, and produce 84 percent of the world’s palm oil. It is the biggest and fastest rural transformation the countries have seen. Palm oil, a vegetable oil used in many foods and other products, has come under fire for its role in deforestation, biodiversity loss and massive forest fires, as well as major social and economic conflicts. This has led to a rise in consumer activism and campaigns against unsustainable oil palm production, with many brands committing to purchase palm oil from sustainable sources only. While governments, civil society groups and industry roundtables are trying to address these many problems, the industry continues to create conflict as it moves into frontier zones with apparent impunity. Why is this?....This “oil palm complex” is managed by a powerful cross-country coalition of political and agribusiness interests. Despite the industry rhetoric, this coalition puts “profits” well ahead of “people” or “planet.”.... Three important but contradictory trends have emerged in the past two decades.... Domination of big plantations...Rise of smallholders....Is private regulation working? A third trend arises from the widespread failure of governments to regulate the excesses of the oil palm industry. Civil society groups and some large corporations have sought to bring about change though private regulation. In the past two years, transnational activism has achieved important shifts in the policies of major producers, buyers and end users of palm oil. Leading firms such as Cargill and Unilever have made commitments to cut their links to deforestation, peatland development and exploitation in the palm oil they procure. Thus there are some signs that the balance of power within the oil palm complex may have shifted in favor of more inclusive and sustainable outcomes. However, these commitments will have limited impact without major changes in accountability and enforcement within the two countries. This especially applies at state and district levels where the key land and profit-sharing deals take place... Moreover, the launching by Indonesia and Malaysia in 2015 of the Council of Palm Oil Producing Countries suggests that these governments and their domestic agribusiness allies are pushing back against the pressure from international NGOs and global corporations. They are emphasizing their “right to develop” and capitalizing on the acquiescence of their biggest markets – China and India – which have higher priorities than safeguarding Southeast Asian forests and livelihoods....http://jakartaglobe.beritasatu.com/opinion/commentary-palm-oil-politics-impede-sustainability-southeast-asia/

  Indonesia & Malaysia Set Criteria for the Council of Palm Oil Producer Countries 12 April 2016 by Arief Havas Oegrosono -- Nine or ten crude palm oil (CPO) producers want to join the Council of Palm Oil Producer Countries (CPOPC), the intergovernmental palm oil council set up by the world's two largest CPO producers and exporters: Indonesia and Malaysia. These two initiators signed an agreement in November 2015 for the establishment of the CPOPC - headquartered in Jakarta - that aims to control the global CPO supply, stabilize palm oil prices, promote sustainable practices in the palm oil industry, and enhance the welfare of oil palm smallholders; more or less the role that OPEC has in the crude oil industry. http://www.indonesia-investments.com/news/todays-headlines/indonesia-malaysia-set-criteria-for-the-council-of-palm-oil-producer-countries/item6697

17 April 2016: Indonesia & Malaysia Set Criteria, no development on peat lands

25 Feb 2016: Two new green industrial zones and Batam questions

12 December 2015: FGV/Felda- Eagle high deal back on

Felda Group to buy 37 pct of Eagle High in new deal-Rajawali exec By Cindy Silviana Dec 11, 2015  * Eagle High shares soar 8 pct after Rajawali comments * Most of purchase likely via different Felda unit -Rajawali * Felda Global may take less than 10 pct -Rajawali * Felda Global says still evaluating possible new deal (Adds comment from Felda Global Ventures, share price) JAKARTA, Dec 11 Malaysia's Felda Group still plans to buy 37 percent of PT Eagle High Plantations Tbk in a restructured deal, a managing director of the Indonesian firm's parent company said, sending shares in Eagle High soaring. The companies are finalising the price, Rajawali's managing director Darjoto Setyawan told Reuters in a text message interview. Read more at Reuters http://www.reuters.com/article/felda-glo-vntrs-eagle-high-plnt-ma-idUSL3N14023820151211#SeA8p6J3iTZRoeAp.99

CPO Productivity Expected to Rise Next Year 27 November, 2015 TEMPO.CO, Nusa Dua - The Indonesian Palm Oil Producers Association (Gapki) predicted that CPO production in 2016 would be somewhere between 33 million and 35 million tons comprising 22 million tons for exports and 13 million tons for domestic consumption.Gapki director executive Fadhil Hasan said that CPO prices next year would be around US$580-US$600 per ton. According to Fadhil, the CPO prices have been affected by the implementation of biodiesel mandatory program, drought, crude oil prices and the establishment of the Council of Palm Oil Producing Countries (CPOPC).   “El Nino and forest fires have reduced CPO productivity by 3-5 percent,” Fadhil said when speaking at the 9thIndonesian Palm Oil Conference (IPOC) in Bali on Friday, November 27, 2015. http://en.tempo.co/read/news/2015/11/27/056722854/CPO-Productivity-Expected-to-Rise-Next-Year

PNG to be member of Palm Oil cabal   25 November 2015  Indonesia's Resources Minister Rizal Ramli says the Jakarta-based council can be a "game changer" for an industry under pressure from falling prices and unsustainable farming practices. Rizal says membership will be extended to other producers such as PNG, Brazil, Colombia, Thailand, Ghana, Liberia, Nigeria, the Philippines and Uganda.
... http://www.radionz.co.nz/international/pacific-news/290492/png-to-be-member-of-palm-oil-cabal


 Malaysia, Indonesia to harmonise palm oil certification  By OOI TEE CHING - 27 November 2015; .... Last week, at the Asean Summit in Kuala Lumpur, Malaysia prime minister Datuk Seri Najib Razak and Indonesia President Joko Widodo announced each country will contribute an initial US$5 million to kickstart CPOPC’s operations.... Yesterday, Indonesia Vice President Muhammad Jusuf Kalla in addressing an international business gathering of 1,200 at the Indonesian Palm Oil Conference (IPOC) 2015, announced Indonesia will be restoring damaged forest and peatland ecosystem. Jusuf announced the government is setting aside Rp50 trillion, for the next five years, to lay the groundwork for rehabilitation. The first phase of restoration will cover two million hectares of forest and peatland. Fadhil acknowledged Jusuf’s remarks that the allocation is equivalent to the annual tax contributed by plantation companies to the government.  In preparation for climate change talks beginning November 30 in Paris, Indonesia and Mal aysia will highlight CPOPC’s long term plans in tackling the region’s haze problem. This will include better dissemination of facts and figures of oil palm planting on peat soil. CPOPC membership, under government-to- government framework, is open to all oil palm cultivating countries such as Brazil, Colombia, Thailand, Ghana, Liberia, Nigeria, Papua New Guinea, the Philippines and Uganda.... http://www.nst.com.my/news/2015/11/114069/malaysia-indonesia-harmonise-palm-oil-certification

Indonesia, Malaysia to try to manage prices together by CK TAN, Nikkei staff writer November 22, 2015  http://asia.nikkei.com/Markets/Commodities/Indonesia-Malaysia-to-try-to-manage-prices-together

30 November 2015: Felda / FGV puts on hold Eagle High deal. Any impact on CPOPC?

Felda puts US$680 million Eagle High stake deal on hold  30 November 2015 1:58 PM; .....Felda Global Ventures Holdings Bhd, the world's No. 3 palm plantation operator, has put on hold a planned US$680 million (RM2.8 billion) purchase in Indonesia after shareholders criticised the deal as too expensive and market conditions deteriorated, sources directly involved with the matter said. - See more at: http://www.themalaysianinsider.com/malaysia/article/felda-puts-us680-million-eagle-high-stake-deal-on-hold#sthash.R9Us5sXk.dpuf

Editor: Some observers point to Felda/FGV - Eagle High being prominently part of the CPOPC announcement. So, the question is whether the new apparent "on hold" status of the deal will impact on any aspect of CPOPC.

   

20 October 2015: CPOPC news review - an Indonesia-Malaysia initiative

Editor's note: CPOPC concept  recently announced (agreed 11 October by Najib and Jokowi), and apparently led by Indonesia. Coordinating Maritime Affairs Minister Rizal Ramli, who led the Indonesian delegation at the meeting with Malaysia’s Plantation Industries and Commodities Minister Douglas Uggah in Jakarta. Interesting that the key bureaucracies (Indonesia Min Ag and MPOB) were not lead on the move and seem to be now catching up to something apparently born in high politics; together with a good mix of big business too. FGV-Eagle High were present at the same event (on a industrial estate deal), and big plantations have also been facing up to Singapore pressure over sustainability-traceability gaps amidst the Southeast Asian haze. The haze has been intense for well over a month now (with some predictions of it lasting through to early next year). Question arise over whether there has been a surprising pick up in smallholder land clearance (judging by rise in some key deforestation measures). CPOPC also comes at the same time as IPOP dilution and a sudden leadership change at ISPO. Palm oil circles noting this unusual contemporaneous flurry of high level business-political shuffles. One key question is this: is CPOPC going to be a price cartel? MITI Minister Mustapa weighs in it is not for price control (while Uggah urges USA to remove Malaysia from forced labour list).

Had a long chat on Friday with a top financial analyst. We were trying to figure out if these moves are to likely to improve the medium or long-term market position palm oil. The analyst has been worried for some time about the deteriorating market perception of palm oil - on it losing markets on poorer perceptions, including middle-income consumers switching away. Price did not come into our discussion. I think we have to watch for good implementation of ISPO whose re-regulation would help alongside upgraded and added efforts on the haze (an annual bad press that clings to palm oil). Because commercial issues are so entangled with sustainability-traceability, some specialists also worry about delays to real action, including strong upgrade of ISPO or implementation of Indonesia regulations. The downplay of regulations for voluntary programmes is puzzling. Surely it should be voluntary programmes with regulations fully complied? Or is it time for a discussion on regulations and business compliance as well as smallholder compliance?


News links:

So, what will it actually do?

1. Promote sustainability? Maybe not? What about ISPO implementation? Regaining policy sovereignty over green trade barriers?

Bold move in palm oil — Jakarta Post Saturday October 17, 2015; OCTOBER 17 — The devil is in the details. This saying is quite relevant for Indonesian and Malaysian officials making preparations for the establishment of a cartel-like organisation called the Council of Palm Oil Producing Countries (CPOPC) that both governments agreed on in Jakarta early this month. It was the first time that both countries, which control about 85 per cent of global palm oil production but which have so far been competing fiercely against each other in the international market, agreed on concrete cooperation in controlling the palm oil market, which has been in a slump since last year. Coordinating Maritime Affairs Minister Rizal Ramli, who led the Indonesian delegation at the meeting with Malaysia’s Plantation Industries and Commodities Minister Douglas Unggah in Jakarta last week, said the CPOPC would jointly promote the marketing of palm oil and its products, conduct palm oil research and development and harmonize the principles and criteria used for their respective certification of sustainable palm oil. - See more at: http://www.themalaymailonline.com/what-you-think/article/bold-move-in-palm-oil-jakarta-post#sthash.49WH24qx.dpuf

New palm oil council would drop "no deforestation" pledge - Indonesia JAKARTA  |  By Augustinus Beo Da Costa; Oct 14 A new palm oil producer grouping being set up by Indonesia and Malaysia would replace "no deforestation" pledges made by major palm companies in favour of a joint set of standards proposed by the two countries, an Indonesian minister said late Tuesday. Indonesia wants big palm oil companies to row back on the historic pledges made at a climate change summit last year, arguing that they are hurting smallholder producers who cannot afford to adopt sustainable forestry practices. Indonesia is the world's biggest producer and exporter of palm oil producer, a key driver of economic growth, and legions of smallholders account for about 40 percent of its palm output. "Indonesia and Malaysia have agreed to harmonize and combine our two standards," Indonesia's chief natural resources minister Rizal Ramli told parliament. "This is an example of how to fight for our sovereignty. We are the biggest palm oil producer. Why (should) the consumers from the developed countries set the standard for us as they want?" http://www.reuters.com/article/2015/10/14/indonesia-palm-ipop-idUSL3N12E22820151014

Sarawak rejects trade barriers  By OOI TEE CHING - 17 October 2015 @ 11:00 AM; .... Wilmar’s refinery in Bintulu, Sarawak, was the main buyer from 41 palm oil mills across the state, absorbing 1.7 million tonnes of CPO, or half of the state’s production. In sourcing CPO to feed its refinery, the Wilmar-Unilever pledge dictated to planters in Sarawak that starting January, it will stop buying oil from estates where there are allegations of land grabbing from natives. The pledge will also lead to a halt in the sourcing of palm oil from farmers who have planted their trees in areas of “high carbon stock” and peat swamp. In an interview at his longhouse in Silas Estate near Bintulu, village head Meikle Ding spoke about his people’s sentiment.  When asked if the native customary rights (NCR) landowners had seen any tangible benefits from the Wilmar-Unilever pledge, Meikle replied: “It looks protective of us natives, but in reality our genuine business partner is Ta Ann Plantation.” ..... Just like the soyabean and rapeseed farmers in Western countries, Meikle said his people were equally deserving of their right to sell their palm oil without trade hindrance. He noted that his people felt Wilmar and Unilever’s pledge was restrictive of Sarawak’s freedom to export to an open market. “The Wilmar-Unilever pledge dictating to planters in Sarawak to comply with it by the end of the year is discriminatory. We prefer a meaningful pledge that states “Yes” to high palm oil prices, “Yes” to our right to prosperity and “Yes” to business growth,” he added. Meikle also questioned whether the Asia-Pacific Economic Cooperation (Apec) and Trans-Pacific Partnership (TPP) agreements would address discriminatory and oppressive business dictates from buyers like Wilmar and Unilever. His query has struck a poignant chord on global edible oils trade politics....  Earlier this week, Indonesia and Malaysia agreed to harmonise and combine palm oil certification standards. Indonesia’s Chief Natural Resources Minister Rizal Ramli told the Parliament that it was time for Indonesia and Malaysia to fight and regain sovereignty on their own turf.... http://www.nst.com.my/news/2015/10/sarawak-rejects-trade-barriers


2. Is it about price? Yes. No?

Mier lauds move to set up palm oil council, on urgency of price stabilising mechanism   By Chester Tay / The Edge Financial Daily   | October 15, 2015 : 10:19 AM MYT; KUALA LUMPUR: The setting up of the intergovernmental Council of Palm Oil Producing Countries (CPOPC) to regulate the edible oil’s production, stocks, and market prices is a step in the right direction, according to the Malaysian Institute of Economic Research (Mier). This is because there is an urgency for both Malaysia and Indonesia to introduce a price stabilising mechanism for crude palm oil (CPO), said the research institution’s deputy director Dr Ahmad Fauzi Puasa in an interview with The Edge Financial Daily last week. “Malaysia and Indonesia need to have a round-table talk to figure out a way to implement this price stabilising mechanism, before it (CPO price) gets even more volatile,” Ahmad Fauzi said. Earlier this month, both countries agreed to spearhead the establishment of the CPOPC. The idea was formally agreed on between Prime Min ster Datuk Seri Najib Razak and Indonesian President Joko Widodo during a meeting at the Presidential Palace in Bogor on Sunday. “The formation of the CPOPC is the biggest achievement in the bilateral relations between Malaysia and Indonesia, and will bring greater benefit to the wider palm oil industry,” Najib said on his Twitter account on Tuesday. The two nations collectively account for 85% of global palm oil production. http://www.theedgemarkets.com/my/article/mier-lauds-move-set-palm-oil-council-urgency-price-stabilising-mechanism

Palm Oil Council not to Control Price, Malaysia Says 14 October, 2015 | 13:32 WIB; "CPOC is not formed to increase [oil palm] prices, because it's not easy to compete against a market. It could work for a day, but not for a long time," Malaysian International Trade and Industry Minister Dato Sri Mustapa Mohamed said in an interview on Tuesday, October 13, 2015 in Jakarta. Mustapa explained that the CPOC will be formed to provide benefits for both countries, particularly in the plantation sector. Despite not being aimed at controlling prices, Mustapa hoped that the palm oil prices must be set at a reasonable level. Mustapa added that the two countries must have an aligned understanding in terms of regulations on palm oil utilization for biodiesel. Indonesia earlier had enforced biodiesel B15, which would be increased to B20. Meanwhile, Malaysia had just enforced biodiesel B5 and would increase it to B7. "Malaysia had not planned to enforce B15 yet. We had just started with B5, and now B7. This must be followed up by the two governments," Mustapa said. http://en.tempo.co/read/news/2015/10/14/056709371/Palm-Oil-Council-not-to-Control-Price-Malaysia-Says


3. Labour standards?

US urged to remove Malaysian palm oil from forced labour list 16 October 2015; LOS ANGELES: Malaysia is appealing to the US Labour Department to remove its palm oil from the “List of Goods Produced by Child or Forced Labour”, Plantation Industries and Commodities Datuk Amar Douglas Uggah said. Among the criteria used by the department to assess child or forced labour was the withholding of passports of foreign workers and payment of low wages, he said. “The Government has undertaken an independent study, covering 68 plantations nationwide, and it showed that incidences of this nature are negligible. “Thus, it is unfair for the department to list the Malaysian palm oil industry alongside others,” he added. Uggah said this in his keynote address at the Global Oils and Fats Forum USA 2015, here on Wednesday. http://www.thestar.com.my/Business/Business-News/2015/10/16/US-urged-to-remove-Malaysian-palm-oil-from-forced-labour-list/?style=biz


Setting it up - a real start in 2015 since bilateral effort first mooted in 2006?

Indonesia, Malaysia to set up palm oil council Published: 3 October 2015 7:11 PM; ... The organisation, which is going to be called Council of Palm Oil Producer Countries, will coordinate palm oil production, manage stocks and stabilise palm prices, Indonesia's Coordinating Minister for Maritime Affairs Rizal Ramli said in a news conference with Malaysian officials today.... Ramli led an Indonesian delegation to visit Malaysia at the end of August to discuss about the plan, during which an agreement for further cooperation was reached. The two governments plan to establish the council after Indonesian President Joko Widodo meets his counterpart Malaysian Prime Minister Najib Razak, Ramli said. Previous attempts to develop better palm relations between the two countries have had limited success. - See more at: http://www.themalaysianinsider.com/business/article/indonesia-malaysia-to-set-up-palm-oil-council#sthash.LEEhLf9h.dpuf

M’sia, Indonesia hold bilateral meeting on palm oil industry October 6, 2015; KUCHING: The bilateral meeting between the governments of Indonesia and Malaysia on strengthening cooperation in the palm oil industry was held in Jakarta on Saturday, October 3 2015. The Malaysian delegation was led by Datuk Amar Douglas Uggah Embas, Minister of Plantation Industries and Commodities together with Datuk Razali Ibrahim, Deputy Minister in the Prime Minister’s Department. The Indonesian delegation was led by Bapak Rizal Ramli, Coordinating Minister of Maritime Affairs and Resources together with Bapak Sofyan Djalil, Minister of National Development Planning, Ibu Musdalifah, Deputy Coordinating Minister of Economy.  This was a follow-up to the meeting held on August 27, 2015 in Kuala Lumpur as has been directed by the two Heads of Government. This bilateral meeting was also joined by Sarawak Oil Palm Plantation Owners Association (Soppoa), Malaysian Palm Oil Association (MPOA), Malaysian Palm Oil Board (MPOB), Malaysian Palm Oil Council (MPOC), Indonesia Palm Oil Association (GAPKI) and Indonesia Palm Oil Fund (BPDP Sawit).... Read more: http://www.theborneopost.com/2015/10/06/msia-indonesia-hold-bilateral-meeting-on-palm-oil-industry/#ixzz3p63ZT6ur

Najib welcomes historical move to set up palm oil council with Indonesia Sunday October 11, 2015; ....The plan to set up a Council of Palm Oil Producer Countries by Malaysia and Indonesia is an indication of the success of bilateral relations, said Prime Minister Datuk Seri Najib Razak. He said the council, which was proposed by both countries in 2006, has become a reality when a consensus was reached on the structure of the organisation which would operate from here....          
- See more at: http://www.themalaymailonline.com/malaysia/article/najib-welcomes-historical-move-to-set-up-palm-oil-council-with-indonesia#sthash.dGuCvu2T.dpuf