KUALA LUMPUR, Nov 5 — The US ban on palm oil products from FGV Holdings Berhad (FGV) is unlikely to have a deep or lasting impact on the sector in Malaysia for now, Datuk Khairuddin Aman Razali told Parliament today.
The plantation, industries and commodities minister said this is because the US, the world’s biggest economy, only imports about 0.0013 per cent of FGV’s total palm oil value a year.
“Therefore, the ban imposed on the Malaysian products by the US, does not significantly affect the sector at this point in time, and it was informed that FGV merely sends or exports about 40 tonnes of palm oil a year, valued at about RM120,000 a year, and if we see the numbers and the overall export of three million tonnes by FGV, the US imports is valued at 0.0013 per cent only,” he said during Question Time in the Dewan Rakyat.
Khairuddin was replying to Jelebu MP Datuk Jalaluddin Alias who wanted to know the extent of the US government’s boycott of FGV on Malaysia’s palm oil product imports for 2020.
International business wire Bloomberg reported on October 1 that the US blocked imports of FGV’s palm oil and palm oil products on the grounds that a yearlong investigation “reasonably indicates” the use of forced labour in the plantation and commodities sector.
Shipments from the company and its subsidiaries were detained at all ports of entry to the US effective October 7.
Khairuddin added today that the migrant labour issues raised by the US have been addressed.
He said Malaysia had postponed taking in any more foreign workers from June 4 to prevent the spread of the Covid-19 virus.
The suspension had the added benefit of increasing job opportunities for Malaysians, strengthening the plantations sector’s contribution to the economy.
Palm oil is a key commodity in Malaysia, which is the world’s second-largest producer after Indonesia.
In his reply, Khairuddin said that the US Customs and Border Protection (CBP) had only sanctioned FGV on September 30, over petitions filed by several NGOs alleging forced labour by the palm oil giant.
“However, the truth of the accusations still cannot be verified and we need a fair evaluation to seek justice in this accusation,” he said.