KUALA LUMPUR (May 31): Tan Sri Mohd Bakke Salleh, a veteran in the plantation industry, is optimistic that palm oil will still continue to flow into the EU despite the ban on using it for biofuel in the continent.
Bakke, who will retire from executive deputy chairman and managing director posts in Sime Darby Plantation Bhd next month, commented that palm oil might be used for other applications besides biofuel.
"Market forces would certainly come in the way with this whole decision to ban palm oil, because it is not just because of environmental or health reasons alone. There are other factors which have guided the thinking of the EU.
"So we really believe that due to the practical aspect of this ban, we may not necessarily see it being enforced in totality because it would face constraints," he told the media at the group's quarterly result briefing this afternoon.
Bakke noted that due to market constraints, the EU may not have the flexibility of substituting palm oil with rapeseed oil or other (edible) oils as additional supply of the substitute edible oil might not be available.
Malaysia and the EU have been at loggerheads over the latter's proposed plan to restrict palm oil in biofuel starting 2021 and to completely phase it out by 2031.