European Embargo on Palm Oil, the Loss of World’s Forest for 20 Million Hectares

The European Union’s plan of embargo on palm oil in 2020 along with the palm oil free movement imposed on the multinational palm oil industry will be paid dearly by the world community in the form of the loss of around 20 million hectares of world forest. How is it possible?

The European Union (EU) community is one of the world’s largest net importers of vegetable oil. About 60 percent of EU’s needs for vegetable oil such as palm oil, soybean oil, rapeseed oil, sunflower oil and others must be met from imports. There is a limited space for EU to increase the production of domestic vegetable oil namely rapeseed oil and sunflower oil due to limited land. According to a study by FAO, in order for EU to reach self-sufficiency in vegetable oil, around 70 percent of its agricultural land must be converted into biofuel crops. This is clearly impossible because the EU’s food security is at risk for being threatened. Therefore, import of vegetable oil remains the best choice for the EU.

The volume of EU imports of palm oil is currently around 7 million tons per year. They are for food, biofuels and the oleo chemical industry. It is estimated that from 2020 up to 2030, it will reach an average of 10 million tons per year for food, energy and the oleo chemical industry.

What is going to happen if the EU really stops using palm oil? There are only two possibilities. The first one is, they might have to increase rapeseed and sunflower production both in the EU and in other European regions (outside the EU). This means that the area of ​​plantations must be expanded. Rapeseed oil and sunflowers production is only around 0.5 ton per hectare, in order to replace 10 million of palm oil imports, 20 million hectares of new land is needed to plant sunflower and rapeseed trees. They will have to conduct a large scale conversion to European forest (deforestation).

The second option they have is to replace palm oil imports by increasing imports of other vegetable oils such as soybean oil from South America. If the EU chooses the second option, replacing 10 million tons of palm oil requires expansion of 20 million hectares of soybean plantation (or other biofuel crops). This means adding another conversion (deforestation) of the world’s forests by 20 million hectares.

In other words, if the EU carries out embargo on palm oil, then the EU will only promote a greater deforestation in the world by 20 million hectares. Meanwhile, if the EU continues to consume palm oil, there is no need for additional deforestation in the world because 2 million hectares of oil palm plantations is enough to meet the needs of 10 million tons of palm oil.

So the choices that the EU has for their embargo on palm oil are both inferior to palm oil if we look from the economic and ecological perspective. Even the options are contradictory to the EU’s own goals. EU bans oil palm so that deforestation will stop; however, it is actually spurring greater deforestation of the world’s forests.

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