Land Legality is the Basis of Malaysia’s MSPO, ahead of US Congress’ Proposal

Image credit: Tom Williams/Pool via REUTERS

US Congress Seeks to Reduce Illegal Deforestation Globally

Democrats in the U.S. Congress on Wednesday were set to unveil legislation to reduce illegal deforestation globally by restricting the trade of certain agricultural commodities, such as palm oil and cattle, produced with those methods.

The news report from Reuters further stated that:

The "FOREST Act of 2021," introduced simultaneously in the Senate and House of Representatives by Democratic Senator Brian Schatz and Representative Earl Blumenauer, could have a major impact on trade from nations such as Brazil and Indonesia, but faces a difficult climb in the deeply divided Congress.

In these times of climate crisis when nations and corporations seek to reduce the environmental impacts of consumption, the US proposal feels like a vindication for Malaysian palm oil.

Proposed US Legislation a Justification for MSPO

This new initiative to reduce deforestation, specifically illegal deforestation, indirectly supports the raison d'être or justification for the existence of the MSPO. To understand this point, some background information on the palm oil industry in Malaysia is needed.

Palm oil production and all related industry activities are strictly managed by the Malaysian Palm Oil Board (MPOB). It was incorporated by an Act of Parliament (Act 582) and established on May 1, 2000. The MPOB is a key government agency under the Ministry of Plantation Industries and Commodities whose main role is to promote and develop national objectives, policies, and priorities for the Malaysian oil palm industry.

As a government agency under the auspices of the Ministry of Plantation Industries and Commodities, the MPOB has firm control over every aspect of the palm oil industry in Malaysia. The control extends from what species of oil is cultivated to the operations of palm oil mills.

Among the many legislative roles of the MPOB is the licensing of all palm oil operations in Malaysia. This is how the MPOB can control all aspects from what species of oil palm is being sold in commercial nurseries to the licensing of smallholders irrespective of their farm size down to the effluence discharge of palm oil mills.

The strict quality control system established by the MPOB was put in place to promote Best Management Practices for agriculture and has evolved with the latest science and technologies of the time.

This was put in place not so much out of concern for how outsiders might perceive the Malaysian palm oil industry but as an earnest effort to ensure that Malaysian palm oil production benefitted everyone. This is inclusive of the smallholder who might grumble about having to buy oil palm seedlings from MPOB licensed nurseries to the Malaysian whose quality of life might be affected by the industry.

The Role of the MSPO in Quality Assurance

What the MPOB has done to assure the sustainability of Malaysian palm oil is not so clearly evident unless one is familiar with the industry.

This was the driving force behind the establishment of the Malaysian Sustainable Palm Oil (MSPO) scheme which sought to quantify in no uncertain terms, that Malaysian palm oil is sustainably produced. 

The MPOCC as custodian of the MSPO certification scheme is responsible for ensuring that the mission statement of creating a supply chain of certified sustainable palm oil for the world is realized.

As of this writing, close to 90% of all Malaysian palm oil production is certified under the MSPO with doubled certifications under other certification schemes including the Roundtable on Sustainable Palm Oil (RSPO) and the International Sustainability & Carbon Certification (ISCC) to deliver a quality of vegetable oil that is without peer.

The comprehensive qualifications needed to become certified under these multiple quality schemes are firm assurance to the US Congress that Malaysian palm oil is first and foremost, legal.

Legality is one of the first criteria under the MSPO as palm oil operations in Malaysia must be able to prove that it is legal. This can only be proved with a license from the MPOB which is also required by the MSPO and ISCC. The licensing is so thorough that even the harvests from licensees are monitored to ensure that their reported yields match up to the expected tonnage of Fresh Fruit Bunches.

This measure may seem extreme but it is necessary to ensure that Malaysian palm oil was not produced through illegal deforestation such as those that operate within protected areas. It is a deterrent for illegal farms that have worked well to preserve forested areas in Malaysia that are protected by law.

This explains the delay in certifying 100% of Malaysian palm oil under the MSPO as the key issue of land claims for individual farmers in Malaysia needs to be endorsed by the state before the MPOCC can consider any applications for their certification. 

Land rights for the indigenous farmers especially in the main producing states of Sabah and Sarawak are under the purview of state governments. The state governments have implemented legal title drives in recent years to support the ambitions of the MSPO.

This is an arduous task that needs to consider the many levels of claims as tribal territorial claims need to be verified further into individual land claims. This method of establishing land claims for Malaysia’s indigenous peoples has worked well to mark out community areas especially communal forests which all villagers have a right to access.

The bottom-line for the US Congress proposal to reduce the import of commodities from illegally deforested areas is that the problem does not exist within certified palm oil from Malaysia. Clear and convincing evidence of this can be seen through the MSPOTrace app that traces Malaysian palm oil from farm to factory.