MSPO is a mandatory standard for the entire palm oil value chain, from smallholders and growers to millers, dealers, and processors.

Plantation and commodities minister Johari Ghani said the MSPO represented Malaysia’s ability to meet global market expectations “without leaving anyone behind”.

“It also ensures that more than half a million smallholders are fully part of the sustainability agenda.

“The EU’s acknowledgement also underscores MSPO’s credibility as a trusted and future-ready standard.

“It gives global buyers the assurance that Malaysian palm oil is legally sourced, traceable, and sustainable, anchored in the livelihoods of smallholders and backed by a mandatory national framework,” he said in a statement.

The EU announced its acknowledgement of MSPO on Aug 5 when its commissioner for environment, water resilience and a competitive circular economy, Jessika Rosswall, visited Malaysia.

On Sept 5, Johari declared that Malaysia was on the right track to be classified as a “low risk” country in palm oil production.

Malaysia is currently classified as “standard risk” under the EU Deforestation Regulation (EUDR).

The EUDR requires exporters of cocoa, coffee, palm oil, soybean, cattle, rubber and timber to the EU to ensure that their products are not tied to deforestation and are legally sourced.

Johari had then said one of the key measures that could improve a nation’s commodity classification was the MSPO certification, which was made mandatory in Malaysia in 2020.

Today, Johari said EU’s recognition could facilitate operators’ compliance with the EUDR.