The European Parliament is moving to ban the use of palm oil in biofuels, while British grocer Iceland has announced it will stop using the commodity over concerns that it causes widespread environmental destruction.
Losing the key European market worries small farmers Indonesia and neighbouring Malaysia – the world’s top two producers – as prices drop for an oil found in everything from biscuits and sweets to cosmetics and vehicle gas tanks.
Europe is one of the world’s biggest palm oil consumers, along with India and China.
About half of the palm oil used last year in Europe was for biofuels that ended up in gas tanks, according to environmentalists.
Indonesia and Malaysia have threatened retaliatory sanctions on European products over the proposed palm oil ban, which calls for a complete phase-out from biofuels by 2030. The legislation is awaiting a final vote and member-state approval.
As the diplomatic row smoulders, Indonesian grower Selamet Ketaren says he and other small farmers – the backbone of the industry – are pawns at the mercy of land-clearing multinational firms that buy their crops.
Why Europe (and the globe) Can’t do Without (Asian) Palm Oil