By Mei Mei Chu

KUALA LUMPUR – Malaysia must not reduce its biodiesel mandate, a group of biodiesel producers said Tuesday. The move comes after Indonesia banned the export of edible oil, raising concerns that it might be used in fuel or food.

Malaysian Palm Oil Board (MPOB), a regulator of the industry, advised Reuters Monday that countries need to slow down the production of edible oils as biofuels in order to have enough food. This was in response the Indonesian ban.

The Malaysian Biodiesel Association (MBA), stated in a statement that “any knee-jerk reaction to banning biofuels derived vegetable oils will cause havoc on the global vegetable oil marketplace.”

According to the MBA, Malaysia is an export-oriented country with a very small domestic market.

Malaysia must not decrease or end its biodiesel mandate, as Malaysia’s biodiesel sector hardly uses 1 million tonnes per year, against more than 40 million tonnes globally.

Indonesia is the largest exporter of this versatile oil, which can be used in biodiesel and chocolates. It plans to stop all shipments of palm olein that has been refined, bleached, or deodorized (RBD), starting Thursday.

Although it will allow the export of crude palm oil and derivative products, it stated that it would be prepared to lift its ban should it face domestic shortages in derivatives for production of cooking oils.

Indonesia and Malaysia account for approximately 85% of the global palm oil production.

Each country requires biodiesel to have at least 20% of palm oil. However, they stated last month that their commitment to the mandates remains despite rising palm prices as a result of war in Ukraine.

Some countries have biofuel mandates. They also make biofuels using plant oils, such as soybeans or corn. The demand for these products has soared in recent years because of climate change mitigation.