PH, Indo, Malaysia agree to settle palm oil issue

Importation data gathered by the DA showed that exports of palm oil to the Philippines by both Indonesia and Malaysia have increased by 100 percent over the last three years. (Shutterstock Photo)

MANILA — The Philippines and its ASEAN-neighbors– Malaysia and Indonesia– have agreed to form a tri-partite technical working group to address the smuggling and dumping of palm oil into the country to the detriment of local coconut farmers.

Department of Agriculture (DA) Secretary Emmanuel “Manny” Piñol said the agreement was reached on Thursday following a call by Malaysian and Indonesian government representatives on him.

The DA earlier recommended a temporary ban on palm oil importation from Indonesia and Malaysia, citing figures which indicate dumping of the commodity which led to the collapse of local coconut prices.

Under the rules of the World Trade Organization (WTO), member-countries could initiate measures to safeguard its farmers affected by the dumping of excess commodities from other countries.

Importation data gathered by the DA showed that exports of palm oil to the Philippines by both Indonesia and Malaysia have increased by 100 percent over the last three years.

Since palm oil is cheaper than coconut oil, the former’s increase in the commodity exports was cited one of the reasons behind the collapse of copra prices.

During yesterday’s meeting, Piñol said, it was agreed that the technical working group will draft recommendations on the rationalization of palm oil exports to the Philippines.

Piñol said he proposed keeping palm oil exports by Malaysia and Indonesia at levels which would not hurt the country’s coconut and palm oil industry.

He also called on Malaysia and Indonesia to check on reports on the alleged smuggling of crude and refined palm oil to the Philippines.

Piñol also suggested to the two countries to open up their markets to Philippine products, especially coconut-based products, to correct the trade imbalance.

The technical working group is expected to be organized next week.