
Welcome to our dedicated EUDR resource hub for the Malaysian palm oil industry. Here, visitors can explore concise information about the European Union Deforestation Regulation (EUDR) and its implications for Malaysia. Discover the Malaysian Palm Oil Council’s (MPOC) initiatives and access essential EUDR resources and references to stay informed and engaged.
About EUDR
As the world’s largest trading bloc, the European Union (EU) is a primary consumer of agricultural commodities. This includes commodities grown in tropical countries such as palm oil, timber, cocoa and coffee. However, EU’s ever-growing demand for food, feed, fuels and biomass has led to increased production of these commodities, resulting in an expansion of agricultural land globally. This global expansion for agricultural commodities has been identified as the main driver for deforestation and forest degradation globally.
Recognising its impacts on deforestation globally due to its market demands, the EU Commission has proposed a Regulation in 2021 to minimise EU-driven deforestation and forest degradation. This was later legislated in the form of the EU Deforestation Free Regulation (EUDR), which entered into force on 29 June 2023. This regulation is part of EU’s Green Deal objectives, which outlines its ambitions to be climate neutral by 2050.
The complete EUDR document can be found here: Regulation - 2023/1115 - EN - EUR-Lex (europa.eu)
EUDR aims at minimizing EU consumption of commodities and products coming from supply chains associated with deforestation or forest degradation, and increasing the EU demand for and trade in legal and deforestation-free commodities and products.
- Minimising EU’s contribution to deforestation and forest degradation worldwide, in order to reduce greenhouse gas (GHG) emissions and biodiversity loss, especially endangered species.
- Minimising deforestation and forest degradation risk of products from supply chains associated with deforestation and forest degradation entering the EU market.
- Increasing demand for deforestation-free and legal commodities and products in EU
Seven commodities are affected, namely palm oil, cattle, cocoa, coffee, soy, timber, rubber and the commodities’ derivatives. The list of commodities here will be regularly reviewed and updated, taking into account new data such as changing deforestation patterns.
However, the EU has informed that "the exact list of products is to be found in Annex I. Products not included in Annex I are not subject to the requirements of the Regulation, even if they contain relevant commodities in the scope of the Regulation. For example, soap will not be covered by the Regulation, even if it contains palm oil".
To verify if the said product is affected by the EUDR, refer to the list of products and its Customs Code in the Annex I below:
Source: EU
More information on the EUDR scope can be found here: Scope - European Commission (europa.eu)
These are the key EUDR requirements that would impact both operators and producers alike:
- Article 3 (Prohibition), which requires commodities and relevant products to be deforestation-free, legally produced and covered by a due diligence statement.
- Article 8 (Due Diligence) stipulates that EU operators and traders placing relevant products on the EU market will need declare through a due diligence statement that their products entering the EU are both deforestation-free (produced on land that has not been subject to deforestation after 31 December 2020) and legal (produced in accordance with the relevant legislation of the country of production).
- Article 9 (Information Requirement) which requires supply chain traceability and transparency, including geographical information on the commodities source of origin. There is an obligation to precisely provide the geo-location of the plot of land involved in the production/farming of the products & commodities for each shipment, to ensure that these products can be traced back to its areas of origin, and verified if it meets the EUDR requirements.
- Article 29 (Assessment of Countries), where the Country Benchmarking System will assess producing countries / parts thereof’s level of risk of deforestation and forest degradation to be either “High-Risk”, “Standard Risk” or “Low-Risk”. “High-Risk” countries will be subjected to higher frequency of audit checks by Competent Authorities, and more due diligence efforts by operators and traders.
More information of the operators obligations can be found here: Due Diligence - European Commission (europa.eu)
More information on the Country Benchmarking can be found here: Benchmarking & Partnerships - European Commission (europa.eu)
Entry of products linked to deforestation will be prohibited and all products linked to deforestation will be withdrawn if they are already present on the EU market. Fines will be imposed a minimum of 4% of the annual turnover of the operator in the EU. Full information on the EUDR penalties can be found here: https://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:32023R1115
Initially, EU operators and traders placing relevant products on the EU market will need to comply with the new rules as of 30 December 2024, while EU SMEs will have six additional months (by 30 June 2025).
The EU has later agreed to postpone the EUDR implementation by another 12 months. The revised timeline is now 30 December 2025 (for EU operators and traders) and 30 July 2026 (for EU SMEs).
EU’s official FAQ site on EUDR can be found here: https://green-business.ec.europa.eu/deforestation-regulation-implementation_en#frequently-asked-questions
How is Malaysia / the Malaysian Palm Oil industry affected?
Palm oil is one of the seven commodities covered by the EUDR. In Malaysia, palm oil makes a significant contribution to the economy, particularly the rural economy, due to the large number of smallholder farmers included in the production base.
The EU is also a significant export market for Malaysian palm oil (ranking third after India and China), importing 2.66 million tonnes of palm oil and palm products from Malaysia in 2023. As Malaysian exporters and stakeholders prepare for the forthcoming implementation of the EUDR and compliance with its requirements, significant financial and technical investments have been made (to meet the EUDR requirements), focusing on geolocation, legality information, and supply chain traceability.
However, many small farmers in the palm oil supply chain face difficulties and risk exclusion from the supply chain. Providing the necessary due diligence information also remains challenging due to the complexities of the palm oil supply chain.
The EUDR is potentially a non-tariff barrier imposed by the EU which curtails free market access and discriminates against Malaysia's impacted commodities, especially palm oil. It prevents an open access market and affects its consumer perception. The requirements will also translate to additional financial and manpower costs for the Malaysian companies, especially its smallholders.
It is anticipated to significantly impact palm oil use in the EU, and might create a negative image for Malaysian palm oil and potentially reducing exports globally.
Small farmers are particularly at risk, as the regulation's stringent demands on traceability and geolocation may hinder their access to the European market, jeopardizing livelihoods and undermining UN Sustainable Development Goals (SDGs).
The EUDR benchmarks countries based on deforestation rates and agricultural land expansion. If Malaysia is classified as a high-risk country, it could result in reduced commodity purchases by the EU, increased operating expenses for due diligence, negative perceptions from European consumers, and potential trade barriers. This would raise production costs for palm oil producers, especially smallholders, impacting food and energy costs and diminishing the quality of life for Malaysian farmers.
In order to address the EUDR challenges and ensure an unrestricted trade access for Malaysian palm oil, MPOC and the Malaysian Government is engaging the EU, industry members and CPOPC to ensure that the Malaysia is classified as a low-risk country, MSPO is accepted as a tool in meeting the EUDR requirements and for Malaysian palm oil to continue accessing the EU markets without additional regulatory barriers and cost.
This include lobbying for financial and technical provisions and assistance from EU for Malaysia to meet the due diligence and traceability requirements, especially for smallholders, and positioning the Malaysian Sustainable Palm Oil (MSPO) certification scheme as a compliance tool to meet the EUDR requirements.
Malaysia is also leveraging on multilateral engagements with producing countries to present a collective case to the EU for better negotiating position. Both Malaysia and Indonesia have held joint dialogues and engagement sessions with the EU on EUDR through CPOPC, and will continue engaging through this platform in seeking favourable outcomes for producing and countries.
These are the Malaysian palm oil industry’s position in addressing EUDR:
- Malaysia as a Low Risk Country - Recognising Malaysia’s sustainability and forest conservation efforts / policies / commitments in EUDR’s Country Benchmarking System
- National Schemes Recognition - EU’s recognition of Malaysia’s national sustainability certification schemes, e.g.. the Malaysian Sustainable Palm Oil (MSPO) as a pathway towards meeting the EUDR requirements
- Smallholders Exemption - Ensuring that Malaysia’s smallholders are exempted from the EUDR requirements
Recent engagements and assessments have indicated that the Malaysian Palm Oil industry, via its MSPO certification scheme is well-placed to become a tool that is able to meet the EUDR requirements for Malaysian exporters.
The Malaysian Sustainable Palm Oil (MSPO) certification scheme is now enhanced to meet EUDR standards, with advanced traceability platforms and geo-location systems. Malaysia is also continuing its engagement with the EU to advocate for fair regulations and support for smallholders.
These efforts have led to:
- Establishment of the EUDR Ad-Hoc Joint Task Force where EU’s assistance is channelled to facilitate EUDR requirements
- A joint study by the European Forest Institute (EFI) and MSPO which acknowledged the MSPO certification scheme’s potential in meeting EUDR requirements
- This was reaffirmed by MPOC’s independent study which recognised the MSPO certification’s capabilities in supporting Malaysian companies’ compliance with EUDR
- In December 2024, the MSPO Standards have been officially published on the globally recognised International Trade Centre’s Standards Map. This is another testament of MSPO’s robustness as a leading certification scheme which guarantees the production of sustainable palm oil in Malaysia
- The multilateral dialogues and consultations have also helped influenced EU’s decision to postpone the EUDR implementation to 30 December 2025
Malaysia also remains steadfast in its commitment to sustainability, maintaining 50% forest cover, a pledge first made at the 1992 Rio Earth Summit and enforcing robust forestry regulations. These efforts have earned international recognition from the FAO and World Resources Institute.
25 June 2024
2 May 2024
2 February 2024
4 August 2023
MPOC's News / Press Statements
MPOC Unveils Study To Drive Malaysian Palm Oil Industry Towards Carbon Neutrality and Net Zero
KUALA LUMPUR, 18 November 2024 – The Malaysian Palm Oil Council (MPOC) released a pivotal study identifying innovative pathways for the Malaysian palm oil industry’s journey toward carbon neutrality and
MPOC Welcomes EUDR Delay, Calls on EU to Class Malaysia as Low Risk for Deforestation
Kuala Lumpur, 15 November 2024 – The Malaysian Palm Oil Council welcomes the EU’s decision to postpone its EUDR legislation for 12-months, and now calls on the EU to work
Palm Oil’s New Premium: A Sign Of Sustainability and Profitability
October 29, 2024 PALM oil has been trading at a premium to other vegetable oils on global commodity exchanges, signalling a shift in supply and demand dynamics which belie
How Palm Oil is Driving Progress in Sustainability
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How Malaysia’s Palm Oil Industry is Championing Biodiversity Conservation, A Key Pillar Of ESG
October 10, 2024 There is a growing focus on environmental, social and governance (ESG) practices in the palm oil industry, with Malaysia — one of the largest palm oil
Malaysian Palm Oil Council Welcomes EUDR Implementation Delay
KUALA LUMPUR, 3 October 2024 – The Malaysian Palm Oil Council (MPOC) has commended the European Commission’s decision to delay the implementation of the EU Deforestation Regulation (EUDR) until 30th
Potential EUDR Delay and Release of Guidance Document and updated FAQs
October 3, 2024 Potential EUDR Delay and Release of Guidance Document and updated FAQs The European Commission has recently announced that it has proposed to delay the EUDR’s implementation by
MPOC Urges EU To Delay Eudr Implementation To Protect Small Farmers and Ensure Fair Trade
The Malaysian Palm Oil Council (MPOC) is urging the European Commission to delay the implementation of the EU Deforestation Regulation (EUDR) in response to mounting global concerns. The current implementation
Palm Oil Prices Expected To Remain Neutral at RM3,700 in August Amid Export Surge
Petaling Jaya, 16 Aug 2024 – In July 2024, Malaysian palm oil exports surged by 40% to 1.69 million tonnes, marking the highest monthly export volume since July 2020. Similarly,
Small farms the key to Malaysia’s palm oil sustainability — Siti Dina Razman Pahri
August 16, 2024AUGUST 15 — Supporting Malaysia’s smallholder farmers with technology and policy can ensure a sustainable palm oil industry. Despite intense pressure to meet regulations and competition from its
Malaysian Palm Oil in the EU-27: Performance and Projections for 2024
The edible oil trade in the European Union (EU) is significantly influenced by macroeconomic factors, including regulatory changes and market forces of supply and demand. The EU is a net
MPOC sees palm oil exports to EU stabilising over long term despite EU deforestation regulation
July 12, 2024SHANGHAI (July 10): The Malaysian Palm Oil Council (MPOC) sees palm oil exports to the European Union (EU) stabilising in the long term and it will remain an
EUDR Challenges Needs to be Collectively Addressed with The EU as Uncertainties Still Looms
26 June 2024: The MPOC collaborated with the European Forest Institute (EFI) and key stakeholders to discuss preparations, challenges, and solutions for EU operators and Malaysian exporters to comply with
Preparing for EUDR: Strategies and Challenges Faced by EU Operators and Malaysian Exporters
https://www.youtube.com/watch?v=ajRKR7_a5yE Paper 1 : EUDR information needs and information availability from the MSPO certification By Dr. Josil Murray, Technical expert from the European Forest Institute (EFI) Download Papers Paper
New GAP Analysis Shows MSPO Can Fulfil EUDR Requirements
Today, the Malaysian Palm Oil Council (MPOC) is releasing the findings of a GAP analysis authored by Pierre Bois d’Enghien, RSPO auditor and sustainability expert, and advisor to multiple international
Assessment of EUDR Requirements and the Role of the MSPO Certification Scheme – Download Papers
https://www.youtube.com/watch?v=OX9Mt_-SkeI Paper 1 : EUDR Information Needs and Information Available from the MSPO Certification: Joint MSPO-EUDR Gap Assessment By Dr. Josil Murray, Technical Expert, EFI KAMI Project Download Paper Paper
Can Europe Save Forests Without Killing Jobs in Malaysia?
March 15, 2024By Patricia Cohen Photographs and Video by Jes AznarPatricia Cohen and Jes Aznar interviewed farmers and landowners during a 900-mile road trip on Borneo, as well state officials in Kuala
EUDR Ad Hoc Joint Task Force Kick-Off Meeting Jakarta, Indonesia
The World Environment Day 2022 is celebrated on 5th June and is the biggest international day for the environment led by the United Nations Environment Programme (UNEP) since 1973. This year, the celebration is held in Sweden with the campaign slogan “Only One Earth”, focusing on “Living Sustainably in Harmony with Nature”. The slogan specifically highlights the need to live sustainably in harmony with nature.
MPO Stakeholder Engagement On EUDR With Dr. Astrid Schomaker, European Commission, Petaling Jaya
The World Environment Day 2022 is celebrated on 5th June and is the biggest international day for the environment led by the United Nations Environment Programme (UNEP) since 1973. This year, the celebration is held in Sweden with the campaign slogan “Only One Earth”, focusing on “Living Sustainably in Harmony with Nature”. The slogan specifically highlights the need to live sustainably in harmony with nature.
MPOB: EUDR Will Not Affect Palm Oil Growth, Revenue
KUALA LUMPUR (June 14): The implementation of the European Union Deforestation-free Regulation (EUDR) will not affect Malaysia’s palm oil growth and revenue as European Union imports are insignificant compared to other countries.
Malaysian Associations Strongly Urge Review Of EUDR Implementation, Recognition Of Oil Palm Smallholders
KUALA LUMPUR (March 23): The European Union (EU) has apparently failed to understand the processes involved in the Malaysian palm oil supply chain and it has refused to recognise the existence of smallholders in the entire supply chain, said Sarawak Dayak Oil Palm Planters Association (Doppa).
Smallholders’ Townhall – Peraturan Produk Bebas Penebangan Hutan Kesatuan Eropah (EUDR) – Impak Kepada Pekebun Kecil Dan Industri Komoditi Malaysia
The World Environment Day 2022 is celebrated on 5th June and is the biggest international day for the environment led by the United Nations Environment Programme (UNEP) since 1973. This year, the celebration is held in Sweden with the campaign slogan “Only One Earth”, focusing on “Living Sustainably in Harmony with Nature”. The slogan specifically highlights the need to live sustainably in harmony with nature.
EUDR Resources
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The information provided on this webpage is for general informational purposes only and is not intended to constitute legal, regulatory, or professional advice. While we strive to ensure that the information is accurate, up-to-date, and relevant, we make no guarantees regarding its completeness, accuracy, or applicability to specific situations. The European Union Deforestation Regulation (EUDR) is a complex and evolving area of law, and interpretations may vary. Users are encouraged to consult with legal, regulatory, or other qualified professionals to address specific concerns or compliance requirements. We shall not be held liable for any loss, damage, or liability arising from the use or reliance on the information presented on this webpage. This includes, but is not limited to, direct, indirect, or consequential losses. This webpage may include links to external websites for additional resources. We do not endorse or take responsibility for the content or accuracy of these external sites. By using this webpage, you agree to this disclaimer. If you do not agree, please refrain from using this resource.