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					MPPU Archive / October 2011
FAO Trade and Markets Division - oilseeds desk


      Criteria:

   year           month                                                                       item
                              ARGENTINA - export taxation: In Argentina, export taxes on wheat and maize have been lowered by, respectively, 18 and 20
       2008 December          percent. By contrast, the duties for oilseeds and their products remained unchanged. From 4 December, the following base export
                              duties apply to grains (in percent, ad valorem): wheat 23, maize 20, soybeans 35, sunflowerseed 32.
                              INDIA - oil import duties: Reportedly, India has decided not to re-introduce duties on the importation of crude edible oils
                              (notably palm oil) for the time being - in spite of the recent price falls in the international and domestic oilseed and oil markets.
                              When prices started to surge in 2007, hitting domestic consumers, import duties were lowered and then suspended altogether.
       2008 December
                              Reportedly, import duties will only be re-imposed if domestic oilseed prices drop below the currently applied official minimum
                              support prices for farmers. The only exception is crude soy oil, for which a 20 percent import duty has been reinstated in November.

                              PARAGUAY - land use policy: Reportedly, in an effort to calm current protests against foreigners owing large tracts of land - in
       2008 December          particular of soybean farms - the government is considering to enforce a long-standing law that does not allow foreigners to buy
                              agricultural land from citizens.
                              UKRAINE - domestic price regulation: With a view to counter the marked fall in domestic prices of sunflowerseed, according to
                              unofficial sources, the government has taken steps to add sunlflowerseed to the list of products whose prices are regulated by the
       2008 December
                              state. Such measure will be limited to the 2008/09 marketing season. The official price band has yet to be announced.

                              UKRAINE - export policy: Reportedly, in response to falling international prices and deteriorating export prospects, export duties
                              on sunflowerseed could be suspended during the current marketing season. At the same time, the introduction of export quotas
       2008 December
                              might be required to ensure adequate coverage of domestic consumption needs. Export quotas could amount to 1.2 to 2 million tons
                              and might be allocated primarily to traders that purchase sunflowerseed at the official minimum price.
                              EUROPEAN UNION - common agricultural policy: The recently completed review of the European Union‟s agrarian policies
                              (“Health Check”) carries no major, direct implications for oilseed crops. The only relevant measure is the abolishment (in 2010) of
                              the energy crop premium of € 45/ha, which applies to rapeseed grown for biodiesel production. Other changes applying to arable
       2008 December          crops in general include: the permanent abolition of compulsory land set aside (from 2009); the full decoupling (in 2010) of
                              production payments; rules regarding minimum and maximum payments to individual farmers; the diversion of some direct farmer
                              payments to rural development projects; the simplification and update of cross compliance requirements concerning cultivation
                              practices and related environmental aspects.
                EUROPEAN UNION - GMO approval: Approval for the importation, marketing and use in food and animal feed across the 27
                nation market has been granted for a GMO soybean known as second generation Roundup Ready Soybean. The new variety started
                to be grown in North America and the approval by the EU - an important buyer of USA grown soybeans - was eagerly awaited by
2008 December
                the industry on both sides of the Atlantic. The permission is valid for 10 years and the bean (and any product derived from it) will
                be subject to the EU‟s strict labelling and traceability requirements. The next GM product in line for potential approval is a new
                variety of rapeseed that has been developed and is already cultivated in Canada.
                MALAYSIA/INDONESIA - supply control measures: Reportedly, the two countries agreed to take coordinated action to
                address the current slide in palm oil prices and the slow down in demand for palm oil anticipated for next year as a result of global
2008 December   economic recession. The key means to temporarily slow down production growth will be to intensify replanting of old trees. A total
                of 300 000 ha is being earmarked for this purpose. Farmers that participate in the replanting programme will be given access to high
                quality planting material at subsidized prices.
                MYANMAR - oilcrop promotion: In an effort to reduce the country‟s dependence on imports to meet domestic demand of edible
                oil, the country has embarked on a programme to encourage the cultivation of oilcrops. Crops promoted include groundnut,
2008 December   sunflowerseed and sesame. Improvements in transport infrastructure to facilitate marketing are also envisaged. Furthermore, foreign
                private companies could be allowed to participate in setting up an oil palm industry. The government programme is receiving
                support from OPEC as well as technical assistance from FAO.
                GERMANY - biofuel policies: Reportedly, national mandatory targets for future biofuel admixture in transportation fuels are
                being adjusted downward. Furthermore, from 2015, the calculation basis will be switched from the energy content of biofuels to the
2008 December   greenhouse gas emission savings resulting from their use. Of particular concern to the oilcrop sector is a provision that prevents the
                use of palm oil and soybean oil under the mandatory schemes and preferential taxation system until criteria for the sustainable
                production of biofuel feedstock are in place.
                CHINA - state procurement: After prices for domestically grown grains and oilseeds have declined as a result of record crops
                and weak demand the government decided to buy soyabeans, rapeseed and other arable crops for state reserves in an effort to
                support prices, protect farmers‟ incomes and stabilize plantings in 2009. Imported soSoybeans State soybean reserves were not
2008 December
                maintained before. Reportedly, 1.5 million tons have been bought and funding has been made available for another 2.5 million tons -
                 compared to a total domestic crop of about 16 million tons. Domestic soybean farmers find it increasignly diffuclt to compete with
                imported soybeans.
                THAILAND - palm oil support: After raising last month the reference price at which farmers sell palm fruit to crushers, the
                government plans to purchase palm oil from oil mills at a guaranteed price, hoping to prevent prices from falling further. The recent
2008 December
                decline in mineral oil prices has made the use of palm as biodiesel feedstock uneconomic, leading to an excess of supply over
                demand.
                Sustainable palm oil: A first shipment of certified and traceable palm oil - produced in Malaysia in accordance with RSPO‟s
2008 December   sustainability criteria - has been delivered to the European Union. But environmental and social groups continue to question the
                value of the certification pointing at environmentally and socially unsustainable production methods in the countries of origin.
               ARGENTINA - grains export taxation: In Argentina, export taxes on wheat and maize have been lowered by, respectively, 18
               and 20 percent. By contrast, the duties for oilseeds and their products remain unchanged - despite the recent sharp drop in global
2009 January
               oilseed prices. From 4 December, the following base export duties apply to grains (in percent, ad valorem): wheat 23, maize 20,
               soybeans 35, sunflowerseed 32.
               EUROPEAN UNION - biofuel policies: The EU decided to retain its binding target to have 10 percent of its vehicle fuels sourced
               with renewable fuels by 2020. To encourage the use of non-food feedstock, second generation biofuels will count double against
               the target, while feedstock grown in high biodiversity and carbon stock areas will not be admitted. Specific sub-targets according to
2009 January   the type of feedstock used and the form of transport have not been set. By 2017, in order to be counted against the target, biofuels
               need to achieve at least 50 percent reduction in GHG emission over conventional fuel. For the time being, the carbon footprint of
               related indirect land use changes will not be taken into account. A further review of these policies is envisaged for 2014.

               THAILAND - soymeal import tariff: For 2009, the tariff for soymeal (imported from WTO members) has been reduced from 4 to
2009 January   2 percent. The regulation requiring eligible importers to also purchase domestic soya meal at minimum prices set by the government
               remains in place.
               UNITED STATES - biodiesel feedstock: Towards the end of 2008, the use of animal fat as feedstock for biodiesel production has
2009 January   dropped sharply in response to the introduction of stricter biodiesel standards and as prices for vegetable oils abandoned their
               record level.
               Certification of ‘sustainable palm oil’: Recently, the first two oil palm plantation companies (both in Malaysia) have been ranked
               as certified producers of sustainable palm oil based on the criteria developed by the global multi-stakeholder initiative RSPO.
2009 January
               Several more companies are expected to gain that status during 2009. A first shipment of certified and traceable palm oil has been
               delivered to the EU last November.
               Soybean modification providing benefit to consumer: A high-oleic soybean GM variety developed in the United States is ready
               for phased introduction in 2009. Compared to conventional soybeans, the new variety features a high oleic acid content, a lower
2009 January   rate of linolenic acid and a reduced percentage of saturated fatty acids. These traits make the oil more stable and versatile in a
               variety of food applications without the need for hydrogenation, thus allowing to avoid the presence of unhealthy trans fatty acids in
               food products.
               EUROPEAN UNION - import approval for new GM soybean: Approval for the importation, marketing and use in food and
               animal feed has been granted for the new high yielding variety known as “Roundup Ready2Yield”. The variety is expected to be
2009 January   extensively grown in the USA, an important supplier of soybeans to the EU. The permission is valid for 10 years and the bean (and
               any product derived from it) will be subject to the EU‟s strict labelling and traceability requirements. The next GM product in line
               for potential approval is a new variety of rapeseed that was developed and is ready for cultivation in Canada.
               UKRAINE - domestic price regulation: With a view to counter the marked fall in domestic prices of sunflowerseed, the
2009 January   government added sunlflowerseed to the list of products whose prices are regulated by the state. Such measure will be limited to the
               2008/09 marketing season. The official price band has yet to be announced.
                CHINA - state procurement: After prices for domestically grown grains and oilseeds have declined as a result of record crops
                and weak demand the government decided to buy soyabeans, rapeseed and other arable crops for state reserves in an effort to
2009 January    support prices, protect farmers‟ incomes and stabilize plantings in 2009. State soybean reserves were not maintained before.
                Reportedly, 1.5 million tons have been bought and funding has been made available for another 2.5 million tons (compared to a
                total domestic crop of about 16 million tons).
                MEXICO - oil import duties: Between January and February 2009, the tariffs on crude and refined vegetable oils will be phased
2009 February   out. The country depends heavily on imports of vegetable oil and consumers are reported to have been strongly affected by last
                year‟s surge in prices.
                MEXICO - income support: In January 2009, the target prices for soybean and rapeseed that are used to determine supplementary
2009 February
                income payments to farmers have been adjusted upward by 30-40 percent.
                GERMANY - biodiesel taxation: In line with the overall policy to gradually scale back support provided to the biodiesel industry,
2009 February   from January 2009 onward, taxation of vegetable oils used as biodiesel feedstock will increase from 0.10 to 0.18 € per litre, while
                the tax for B-100 is lifted from 0.15 to 0.18 € per litre.
                UKRAINE - export policies: The plan to suspend the export duty for sunflowerseed until 1st September 2009 (with a view to
2009 February   stimulate trade) has been dropped so as not to hurt the domestic crushing industry. For 2009, the duty has been set at 13% as
                opposed to 14% before.
                CHINA - state procurement: Further to last autumn‟s purchases (see also issue No.1 ), the government plans to buy an additional
                three million tons of soybeans for state reserves. This could raise the total volume of soybean reserves to up to 6 million tons.
2009 February
                However, last year‟s actual purchases of soybeans for state reserves have been reported at levels below the original targets.

                BRAZIL - ‘sustainable soybean farming’: A global grain trading and processing company entered into partnership with a local
2009 February   NGO to promote sustainable soybean farming in the country. The initiative aims at reducing the environmental impact of soybean
                farming and minimizing expansion into environmentally sensitive areas.
                ARGENTINA - support to farmers: In early January, the government announced plans to provide subsidies on fertilizer and
                loans for purchasing farm machinery. However, export taxes on oilseeds would not be lowered. Later in the month, the government
                declared agricultural emergency in the country‟s main food producing provinces due to widespread drought – reportedly the
2009 February
                worst since 1971. Affected farmers will be allowed to defer various taxes and debt repayments. Unofficial estimates for this
                season‟s soy-crop currently range between 39 and 43 million tons, compared to early-season forecasts around 50 million and last
                season‟s output of 46.2 million.
                JAPAN - carbon footprint labelling: The government has launched a pilot project on voluntary carbon footprint labelling of
2009 February
                consumer products, including foods. Products shall be rated based on the level of CO2 emitted during their life cycle.
                MALAYSIA - palm oil barter trade: For the period 2009-10, USD 70 million worth of palm oil have been earmarked for
2009 February
                bartering for fertilizer with the Russian Federation and the Democratic People‟s Republic of Korea.
                UNITED STATES - growing market for soybeans with special traits: Production and trade of soybeans with special traits –
                notably low-linolenic, food-grade and identity-preserved non-GMO varieties – is growing in importance in the USA. Reportedly, as
2009 February
                much as 1.6 million tons of food-grade soybeans are exported annually. An average price premium of 125 USD per ton was
                reported for non-GMO soybeans.
                INDONESIA - biodiesel support: Reportedly, the government is considering to subsidize the sale of palm oil-based diesel when
2009 February
                low fossil fuel prices compromise the profitability of biodiesel production.
                EUROPEAN UNION - butter market support: In response to the sharp drop in dairy prices, the Commission has reintroduced
2009 February   export refunds for butter. Furthermore, the period during which aid for private storage of butter is granted has been expanded and
                state intervention buying of butter may be allowed to exceed pre-determined levels.
                INDONESIA - oil palm plantations: Reportedly, the government is considering to lift temporary restrictions (in place since late
2009 March      2007) on the use of peatland forests for oil palm plantations. The measure would allow to increase productivity in the oil palm
                sector. The restrictions had been introduced to control carbon dioxide emissions associated with the use of peatland.
                BRAZIL - conventional soybeans: Reversing the trend of recent years, in the state of Parana, farmers‟ demand for conventional
2009 March      soybean varieties has grown this season at the expense of GM seed material. Increased interest for conventional varieties is
                explained by the lower cultivation cost associated with those seeds.
                CHINA - state reserves of vegetable oil: After the recent release of reserves to prevent supply shortages and thus price increases,
2009 March
                private sources reported that public stocks are being replenished via the importation of oils from South America.
                CANADA - trans fat: The government reported progress towards the reduction of trans fats in food products without increasing
2009 March      the levels of saturated fats. The country had made the requirement to indicate trans fat content in pre-packaged food mandatory and,
                in 2006, the industry agreed to voluntary limits in the trans fat content of food products.
                MALAYSIA - biodiesel: Government sources confirmed that blending of diesel fuel with five percent palm oil biofuel will become
                mandatory on January 2010. This year, all government vehicles will start using the blend. To remain competitive, biodiesel sales
2009 March
                shall benefit from a subsidy. Once fully operational the programme is expected to absorb 500 000 tons of palm oil annually.

                INDIA - state imports of vegetable oil: Following the drop in global and domestic prices for vegetable oils, the importation of oils
2009 March
                by state trading agencies for subsequent distribution to poor households has been suspended.
                EUROPEAN UNION - temporary biodiesel duty: From mid March, imports of biodiesel from the USA will face temporary anti-
                dumping and anti-subsidy duties. Tariffs ranging from 26 to 41 € per 100 kg are expected to apply for an initial period of six
2009 March
                months. Surging imports of biodiesel produced in the USA - and benefiting from government support there - are considered to have
                severely injured the competing EU biodiesel industry.
                INDIA - trans fat: A recent study confirms that, on average, trans fat levels in vanaspati and other products based on partially
                hydrogenated oils exceed generally recommended levels. Among refined vegetable oils sold on the market this problem was not
2009 March
                detected. Last year, India has joined the list of countries where the trans fat content must be declared on labels. Discussions about
                revised product standards and the feasibility of introducing binding maximum levels for trans fat are underway.
             GERMANY - biofuel legislation: The EU Commission has requested that the sustainability criteria included in a national law on
             the promotion of biofuels be streamlined with the relevant EU directive. As a result, importation of vegetable oils - especially soy
2009 March   and palm oil - for local biodiesel production is expected to resume. Furthermore, new legislation excluding biofuels that have
             previously received state aids from being eligible for national incentives and mandates will go ahead. Consequently, the importation
             of biodiesel that has benefited from state aid could become uneconomical.
             INDONESIA - biodiesel support: The government confirmed its plan to subsidize the sale of biofuels by state owned companies
             depending on how the prices for fossil fuel and biofuel feedstock (notably palm oil) develop. The subsidy would amount to Rp
2009 March   1000 per litre of biofuel distributed. Under the currently envisaged level of government funding, the sale of up to 750 000 tons of
             biofuel could be supported in 2009 - an amount close to the country‟s mandatory consumption of biofuels in 2009. Palm oil based
             biodiesel should account for about three quarters of all biofuel sales.
             FRANCE - biodiesel taxation: Similar to Germany, where taxes on biodiesel and biodiesel feedstock have been raised in January,
2009 March
             France has announced that all tax advantages granted to biofuel will be discontinued by 2012.
             INDONESIA - palm oil exchange: To date the world‟s leading producer of palm oil lacks an own exchange and futures market for
             palm oil; local traders and policy makers are used to follow contracts traded in Malaysia or the EU to determine prices. Now private
2009 March
             sources report that physical trading in CPO through a local exchange is going to start later this year. State plantations seem
             committed to sell at least 20% of their output through the new platform.
             UNITED KINGDOM and GERMANY - biofuel targets: The rates of mandatory inclusion of biofuels in transportation fuel are
             being corrected downward in both countries: in the UK, the rate for 2009/10 is expected to be set at 3.25% (down from originally
2009 March
             3.75%), rising gradually to 5% by 2013/14. In Germany, the rate for 2009 is being reduced from initially 6.25% to 5.25%, and shall
             be frozen at 6.25% from 2010.
             UNITED STATES - special traits soybeans: According to industry sources, the importance of special trait varieties – developed
             to reduce trans fat and saturated fat content in the human diet – is growing steadily. The swift replacement of traditional soybean
2009 March
             varieties with new ones (i.e. low linolenic, high oleic and mid olein/low saturate lines that deliver direct health benefits) is said to
             have shielded domestic markets from possible disruptions or contractions in consumption.
             EUROPEAN UNION - olive oil labelling: In July 2009, origin labelling will become mandatory for extra virgin olive oil sold in
2009 March   the Community. The country of origin, or, in the case of blends, the type of blending will have to be displayed. The measure aims at
             improving guarantees of quality to consumers.
             ARGENTINA - trade control: Reportedly, the government has met with farmer groups and grains exchanges to discuss about the
2009 March   possibility of setting up a national board that directly regulates and controls foreign trade in grains and oilseeds. A state agency
             charged with the same task, the National Grains Board, was dismantled in the early 1990s.
             UNITED STATES - farm support rules: Motivated primarily by budgetary considerations, President Obama has called for cuts
             in farm subsidies over the next decade. Proposals are reported to include the gradual exclusion of large farms from direct payments,
2009 March
             reductions in the individual payment caps under the commodity programmes and reduced subsidies for crop insurance. Actual
             spending for agriculture is determined by the Congress.
             INDIA - soyoil import tariff: The 20% import duty on crude soyoil introduced last November has been removed again. Soyoil
2009 April   will thus enjoy the same treatment as other crude vegetable oils which are imported duty free since April 2008. By doing away with
             the duty the price premium for soy oil will be restored to normal levels.
             EUROPEAN UNION - butter market intervention: After reaching the ceiling of 30 000 tons for automatic intervention buying
2009 April   at fixed prices in early March, the Commission went on purchasing additional butter into intervention at a price slightly below the
             official intervention price. The purpose of these purchases is to contain oversupply at a period of low market prices.
             EUROPEAN UNION - GM rapeseed importation: The Commission has approved the importation and processing (but not
             cultivation) of a GM rapeseed variety for food, feed and other uses for a period of 10 years. The new variety T45 is characterized by
2009 April
             tolerance to a particular herbicide and is grown primarily in Canada, whose exports towards the EU are expected to resume thanks
             to the approval.
             UNITED STATES - demand for sustainable palm kernel oil: An oleo-chemicals company started to purchase sustainable palm
             kernel oil certification credits. It is the first step in creating a segregated supply chain for sustainably produced palm kernel oil. By
2009 April
             doing so palm kernel oil producers that use more environmentally responsible practices to produce and harvest palm kernel oil are
             going to be paid a premium.
             ARGENTINA - negotiation progress: Negotiations between the government and farmers regarding economic difficulties that
             afflict the sector resulted in agreements eliminating export taxes on dairy products, increasing the export quota for beef and
2009 April
             guaranteeing a higher price for wheat sold domestically. The tax levied on soybean exports remains unchanged. Plans to set up a
             grain regulating agency have been postponed.
             PAKISTAN - INDONESIA trade agreement: Under preferential trade negotiations, Pakistan has agreed to reduce duties on palm
2009 April
             oil imports from Indonesia by 10 percent, which would put duties at par with those applied to imports from Malaysia.
             CANADA - trans fat limits at province level: From October 2009, foods served in restaurants will be subject to specific limits for
2009 April
             trans fat content in British Columbia. Since 2006, the industry was following voluntary limits at the federal level.
             MALAYSIA - palm oil market measures: Government efforts to prevent oversupply on the domestic market continue. Under the
             200 000 ha oil palm replanting scheme, by March 63 000 ha were approved, implying a temporary reduction in palm oil output by
2009 April   approx. 220 000 tons. Mandatory use of palm oil based B5-diesel in the entire transportation and industry sector is set to start next
             January, entailing a market offtake of approximately 500 000 tons of palm oil. And the increase in the country‟s duty free export
             quota for crude palm oil to 3 million tons in 2009 is expected to stimulate exports.
             BRAZIL - mandatory biodiesel use: From January 2008, all diesel sales had to include 2 percent of biodiesel, which created a
             market for about 800 thousand tons of biodiesel. Biodiesel production capacity is reported to have climbed to 2.6 million tons last
             year. In order to better use this capacity, the mandatory admixture was raised to 3 percent in July 2008, and currently a further
2009 May
             increase to 4 percent is under consideration. The obligatory 5 percent blend envisaged for 2013 has been anticipated to 2010. The
             main feedstock used for biodiesel production is soybean oil; its share in total feedstock use was close to 80 percent in 2008.
            UNITED STATES, CANADA - new oilseeds varieties: GM varieties containing less saturated fats and thus offering a better
            health profile are gaining ground in North America. In the USA, commercialization of a new high oleic soybean variety is expected
2009 June   later this year. In Canada, high oleic (or low linoleic) varieties are estimated to account for 10-15 percent of the country‟s rapeseed
            area. As herbicide resistant and higher yielding strains become available, farmers are increasingly interested in growing these
            specialty crops.
            ARGENTINA - herbicide investigation: The government was reported to have set up an inter-ministerial committee to investigate
2009 May    the environment and health impact of glyphosate, the active ingredient in an approved herbicide that is widely used in soybean
            cultivation (in Argentina as well as in other leading soybean producers).
            UNITED STATES - soybean rust resistance: Reportedly, US scientist have identified asian rust resistance genes in soybeans,
            thus opening the way to the development of resistant cultivars via conventional breeding or biotechnological means. Asian rust
2009 May
            represents a major threat to soybean cultivation in many countries. Although fungicide use is effective against the disease, the
            provision of farmers with resistant varieties would be more sustainable.
            CHINA - improved rapeseed varieties: Scientist are reported to have developed - via conventional breeding techniques - new
2009 May    rapeseed varieties featuring an oil content of 55-60 percent, which is 15 percent more than in the varieties currently used in the
            country. Among domestically grown oilcrops, rapeseed is the leading source of vegetable oil in the country.
            ARGENTINA - incentive for using domestic soybeans: With a view to privilege the use of domestically grown soybeans, the
            government has removed the export tax exemption applied to soyoil produced from imported soybeans. Furthermore, the tax break
2009 May    on soybean imports introduced in 2006 has been discontinued, making imports unprofitable. According to unofficial sources,
            farmers are currently stockpiling substantial amounts of old crop soybeans and the above trade measure also aims at stimulating
            farmers to release their stocks.
            UNITED STATES and EUROPEAN UNION - biodiesel footprint: In the USA, soybean-based biodiesel has been officially
            estimated to reduce GHG emissions by 22 percent over conventional diesel. This compares to a minimum 50 percent requirement
            for biodiesel to qualify towards the annual consumption targets. Other feedstock with lower footprint, for example animal fats or
2009 May    waste grease, might be required to meet the mandatory biodiesel target set for 2012. In the EU, the default values for GHG emission
            savings have been set at 31 percent for soy-diesel, 38 percent for rapeseed-diesel and 19 percent for palm oil-diesel, which
            compares to a minimum savings requirement of 35 percent (from 2013 onward). Biodiesel producers may claim greater GHG
            emission savings, but the onus of proof will be entirely on them.
            GERMANY, SPAIN - biodiesel capacity: This year, private sources estimate the biodiesel industries of Germany and Spain to
2009 May    run, respectively, at no more than 60 and 10 percent capacity. The low utilization rate is related to reduced public incentives,
            limited mandatory blending rates and the drop in crude oil prices that has eroded the price attraction of biofuels.
            CHINA - state soybean reserve: Reportedly, in addition to the 6 million tons of state purchases scheduled since October 2008,
            state agencies are planning to buy another 1.25 million tons of soybean for temporary reserve. For comparison, total domestic soy
            output in 2008/09 is estimated at 15.5 mill tons. State purchases are carried out at prices above prevailing market prices and are
2009 May
            meant to stabilize domestic oilseed production and prevent further declines in prices as farmers are preparing for the new planting
            season. The federal government is reported to also plan stockpiling between 3 and 4 mill tons of the 2009 rapeseed output.
            INDONESIA - palm oil export tax: The government has kept the indicative world price at which the export tax on palm oil will
2009 May    be re-introduced at 700 US$ per ton. Accordingly, this month the exports of palm oil will remain tax-free. (The NW Europe import
            price for palm oil has risen markedly last month, but stopped short of Indonesia‟s trigger price.)
            EGYPT - subsidized distribution of oil: Reportedly, over the last seven months, the amount of subsidized oil available to
2009 May
            consumers through ration cards has been raised from 350 000 tons to 900 000 tons per year.
            SRI LANKA - palm oil import duty: To assist the domestic coconut industry, the government is considering to raise the special
2009 June
            import duty on palm and palmkernel oil above the current level of Rs 60 per 1kg.
            INDONESIA - taxation of palm oil exports: Considering the recent, steady rise in international palm oil prices, the export tax on
2009 June   palm oil (which, inter alia, aims at protecting domestic supplies of vegetable oil) is likely to be reintroduced in June. The tax had
            been suspended late last year, when a decline in international prices started weighing on the country‟s palm oil exports.
            INDONESIA - palm oil export price: Reportedly, the government is studying a mechanism for setting a national standard price
2009 June
            for palm oil exports - so as not to depend on prices determined in the major European import markets.
            EUROPEAN UNION - subsidization of private olive oil storage: The significant and prolonged decrease in community olive oil
2009 June   prices is expected to trigger the reintroduction of private storage aid, which aims at sustaining the income of olive oil farmers.
            Support shall be limited to 110 000 tons of olive oil in total.
            EUROPEAN UNION - biodiesel duty: The Commission has proposed to extend the countervailing duty on biodiesel imports
2009 June   from the USA (provisionally introduced last March) for five years. The method of calculating the duty could undergo slight
            modifications.
            NEW ZEALAND - biodiesel subsidy: To encourage investment into national biodiesel production, from July and for a period of
            three years, a subsidy will be granted on sales of domestically produced biodiesel that complies with sustainability standards set by
2009 June
            the government. B5 blends are widely accepted in the country, but mandatory consumption targets have been withdrawn last
            December. All imported material needs to meet the same standards.
            CANADA - approval of high oleic GM soybean: Low in trans fatty acids and not requiring hydrogenation, the oil from the new
2009 June
            variety offers improved nutritional qualities. The bean has been cleared for cultivation, food and feed use in the country.
            RUSSIAN FEDERATION - import tax on selected vegetable oils: An import tax of 10% is expected to be introduced soon for
2009 June   palm oil and coconut oil for a period of nine months. The intention is to temporarily shield domestic dairy products from the
            competition of lower priced substitutes.
            UNITED STATES - renewable fuel standard: An expanded renewable fuel standard (RFS-2) issued in draft form by the EPA
            has attracted criticism from the industry. In assessing the life cycle GHG impact of biofuels, the standard considers direct and
            indirect emissions, including those related to indirect land use changes. The justification and methodology for attributing emissions
2009 June
            from land conversion to soybean-based diesel as well as the practicability of the required feedstock certification are being
            questioned. Achieving the country‟s biomass-based diesel targets under the proposed RFS-2 would be challenging if soybean-based
            diesel was excluded.
            Sales of certified sustainable palm oil: Palm oil that has been produced meeting environmental and social safeguards is available
            on the market since November 2008. However, sales of certified palm oil seem to be slow in taking off. According to tentative
2009 June
            figures compiled by the WWF, so far, only about 1 percent of the sustainable palm oil available on the market has been bought.

            Sequencing of oil palm genome: According to official sources in Malaysia, researchers have finally managed to fully sequence the
2009 June   oil palm genome. Eventually, this breakthrough will allow enhancing the productivity and sustainability of oil palm, a plant where
            yield levels have not significantly improved over the last decades.
            CHINA - soybean state reserves: The government is planning to procure an additional 1 million tons of soybeans from
2009 June   Heilongjiang province for temporary storage, in a bid to stabilize the domestic market and protect farmers‟ interests. Reportedly,
            since mid 2008, government purchases have accumulated to a total of 7.25 million tons.
            EUROPEAN UNION - biofuel target: An official report states that the EU is unlikely to reach the indicative 2010 target of
            5.75% of transport fuel coming from renewable energy sources. A community-wide share of 4% is expected instead. The respective
2009 June   share in the year 2005 was 1%. Biodiesel accounts for roughly three quarters of renewable fuel use; bioethanol contributes 15%.
            The EU-Commission estimates that, by 2020, some 20-30 % of the utilization target is going to be met by second generation
            biofuels.
            INDONESIA - palm oil export tax: Suspended since December of last year, in June the export tax was re-introduced at a level of
2009 July   3 percent, in line with the government‟s policy to levy taxes when the world price exceeds a given level. While palm oil shipments
            are likely to decrease, the value of exports is anticipated to remain stable as are domestic cooking oil prices.
            UNITED STATES - export incentives: After remaining unutilized for five years, subsidies for butterfat exports will be
            reactivated for 2008/09 under the Dairy Export Incentive Program (DEIP). The payments are meant to help exporters meet
2009 July   prevailing world prices and to remain competitive vis-à-vis subsidized products from other countries. Allegedly, U.S. producers
            have seen their international market shares erode, in part due to the recent reintroduction of export subsidies by the European Union.

            Round Table for Responsible Soy (RTRS): Following in the footsteps of the Roundtable for Sustainable Palm Oil (RSPO), the
            international multi-stakeholder initiative on soy has approved principles and criteria for responsible soybean production, thereby
2009 July   establishing the basis for the formulation of global standards on environmentally sustainable and socially responsible soy
            production, trade and processing. The next steps will be field-testing the criteria and, eventually, developing proper certification
            standards to be used by traders.
            Certified palm oil: Neste Oil , a Finnish biodiesel producer, committed to shift to certified palm oil as sole feedstock (i.e. palm oil
            produced according to RSPO‟s criteria for environmentally and socially sustainable production). The company, which introduced a
            system of full traceability of the palm oil it uses, expects to use 50 000 tons of certified palm oil in 2009 and considerably higher
2009 July   amounts in the coming years. Similarly, snack food producer Mars committed to use exclusively RSPO certified palm oil
            originating from sustainable sources by 2015. On the other hand, to date global sales of certified palm oil seem to have been
            minimal. Apparently, buyers are concerned about costs and uncertainty of supply. Reportedly, certification can add a premium of
            US$ 50 a tonne to palm oil in the wholesale market.
            BRAZIL - agricultural support 2009/10: The recently announced package of support measures addresses the increasing
            economic difficulties faced by the sector. In particular, the programme raises the supply of credit at controlled interest rates and lifts
            the financing limits per beneficiary. Interest rates will remain unchanged, and the volume of subsidized production loans will
2009 July   increase by 21 percent over last season. Furthermore, agricultural insurance programmes will be enhanced, cooperatives will be
            strengthened and guaranteed minimum prices will increase - especially for soybeans (plus 10%). Overall, special emphasis seems to
            be given to commercial and export oriented agriculture (as opposed to family agriculture). Private sources expect the package to
            contribute to a recovery in production in the coming crop season.
            CHINA - support to crushers: Reportedly, to support farm sales of rapeseed at officially set prices, the government plans to offer
            subsidies to crushers (Yuan 200 per ton crushed). This measure would help farmers to sell their rapeseed crop, which is expected to
2009 July
            hit a new record this year. Similar measures seem to be under consideration for soybeans, with a view to stimulate domestic soybean
            production and to stem the on-going surge in soybean importation.
            GERMANY - biofuel target: Despite opposition expressed by the German parliament‟s upper house, government plans to cut the
2009 July   2009 biofuel blending target - from the current level of 6.25% to 5.25% - and to further raise taxes levied on biofuels have finally
            been confirmed. The higher blending ratio will be introduced only in 2010 and then remain at that level in subsequent years.
            Biofuel blends as jet fuel: A major commercial carrier in the USA reported successful completion of a demonstration flight using a
            biofuel blend comprising jatropha oil. Reportedly, the blend performed as well as traditional jet fuel. Among the key results were a
2009 July   higher fuel efficiency of the blend and substantially lower greenhouse gas emissions (over the entire life cycle) compared to
            conventional fuel. No modifications were required to the aircraft or its engines. The airline hopes to see those fuels produced in
            commercial quantities in the near future.
            CHINA - soybean export duty: According to a local news agency the current 3 percent duty levied on exports of soybean (as well
2009 July
            as other grains and industrial products) will be abolished from July with a view to promote exports.
            BRAZIL - GM soybean submission: Monsanto‟s submission of insect-protected Roundup Ready2Yield soybean for regulatory
2009 July   approval has been completed in Brazil. The US developed variety is heavily targeted at foreign markets and its approval in
            producing and importing countries will be key.
            CANADA - GM soybean approved: A variety high in oleic acid, and thus with improved nutritional qualities, has been approved
            for cultivation, food use and as a feed in Canada. Due to its specific fatty acid profile the oil does not require hydrogenation,
2009 July
            resulting in food free of trans fats. Developed in Canada, the new variety is being submitted for regulatory approval in major
            soybean producing/importing countries including the USA.
            UKRAINE - biofuel incentives: Through a new law granting significant tax benefits to biofuel producers the government aims at
            stimulating domestic production and consumption of biofuels, notably rapeseed-based biodiesel. To date, only non-mandatory
2009 July   targets were in place, biofuel production has been negligible, and rapeseed has been primarily exported to the EU as feedstock for
            biodiesel. Once effectively implemented, the new law could make domestic biodiesel production (for local use and export) more
            attractive, potentially limiting rapeseed shipments and stimulating exportation of finished biodiesel, in particular to the EU
                 EUROPEAN UNION - biodiesel import duty: EU member states have agreed to extend the countervailing duty on biodiesel
                 imported from the USA, which was introduced in March 2009, for the next five years. The measure aims at shielding biodiesel
2009 September   production in the Community from unfair competition by US exporters. The range of the permanent duties has been narrowed
                 compared to the one in place so far. Reportedly, WTO anti-dumping guidelines have been adhered to, thus reducing the likelihood
                 of a legal dispute between the two blocks.
                 EUROPEAN UNION, UNITED STATES - market support for butter: In an effort to help their dairy sectors coping with the
2009 September   prolonged and general depression in prices, the EU and the USA are prepared to extend their recently re-introduced domestic
                 support measures, comprising aid to private storage, public intervention buying and the granting of export refunds.
                 UNITED STATES - GM soybean: Official sources reported that in US agriculture the rate of adoption of GM soybean varieties
                 has reached an estimated 91 percent (compared to 54 percent in 2000 and 7 percent in 1996). Soybeans represent the most widely
2009 September
                 and rapidly adopted GM crop; all modification concerns herbicide tolerance. The marked expansion has taken place in spite of
                 uncertainty about consumer acceptance and economic and environmental impacts of GM products.
                 INDIA - biodiesel import duty: The government is planning to reduce the basic customs duty on biodiesel from 7.5 to 2.5 percent.
2009 September
                 Due to several factors the country is facing difficulties in meeting its biofuel consumption targets from domestic sources.
                 Certified sustainable palm oil: Suppliers of palm oil certified as sustainably produced (in line with RSPO criteria) report lower
                 than expected demand from importers. One explanation is that the global economic slowdown has curtailed demand from price-
2009 September
                 conscious buyers: reportedly, crude certified palm oil sells at a premium of about 50 USD per tonne (uncertified palm oil was
                 traded 600-700 USD per tonne in recent weeks).
                 INDIA - commodity exchanges taxation: With a view to stimulate trade in commodities, the government decided to abolish
2009 September
                 transaction taxes levied on commodity futures trading and on commodity options.
                 INDIA - vegetable oil import duties: After reducing import tariffs markedly during fiscal year 2008/09, the government prefers
2009 September   not to raise them again during 2009/10. As low tariffs remain in place, domestic oilseed and oil prices tend to remain lower, which
                 leads to benefits for consumers but discourages domestic production.
                 CANADA / EUROPEAN UNION - dispute over trade in GM crops: The recent settlement of a long lasting dispute between the
2009 September
                 two countries is expected to favour in particular future sales of Canadian GM rapeseed into the EU.
                 CHINA - SENEGAL land lease deal: Reportedly, China is set to lease land from farmer cooperatives in Senegal to grow
2009 September
                 groundnuts. One third of the output is envisaged for export while the rest will be destined for local processing and consumption.
                 INDIA - subsidized vegetable oil sales: The central government is considering to repeat last year‟s sales of cooking oil through
                 ration shops should retail prices rise. To this end, state-owned trading companies would be directed to import up to 1 million tonnes
2009 September
                 of crude palm oil. To make the operation economic, a subsidy of 15 Rupees per kg of oil sold would be made available.

                 BRAZIL - mandatory biodiesel use: Effective July 2009, the mandatory content of biodiesel in diesel is 4 percent; it started at 2
                 percent in Jan 2008 and became 3 percent in July 2008. A further increase to 5 percent is expected for January 2010 or three years
2009 September
                 earlier than originally planned. Annual biodiesel consumption in estimated to exceed 1.5 million tons by the end of this year.
                 CHINA - public sales of soybeans: First sales of soybeans from state reserves have been reported in August. Sales were done
                 through auctions. Reportedly, public soybean reserves (established for the first time last year in support of domestic soybean
2009 September
                 production) have climbed to between 5 and 7 million tonnes. More sales are expected as the government will try to free space for
                 new-crop purchases. In addition, to facilitate disposal of state reserves, subsidies may be offered to crushers.
                 New options in palm oil futures trading: The Chicago Mercantile Exchange (which includes CBOT) and Bursa Malaysia are
                 planning to jointly list dollar denominated palm oil futures using Malaysia‟s Ringgit-based contract as a benchmark. At the same
2009 September   time, efforts to create its own price benchmark are going on in Indonesia, the world‟s leading palm oil producing nation: the
                 Indonesia Commodity and Derivatives Exchange announced the launch of a new palm oil contract later this year, which follows
                 the launch (with state support) of a new physical crude palm oil contract last June by the Jakarta Futures Exchange .
                 BRAZIL - soya restrictions to protect rainforest: Leading soybean traders and vegetable oil producers agreed to extend for
2009 September   another year the moratorium on buying soybeans grown on illegally cleared areas in the Amazon rain forest. The ban that went into
                 effect three years ago has been extended to July 2010.
                 EUROPEAN UNION - GMO traces halt soy imports from United States: EU importers decided to temporarily suspend
                 soybean imports from the USA after traces of unauthorized GM maize (i.e. varieties not cleared for use in the EU) were found in
2009 September
                 US soymeal shipments. The EU applies a zero tolerance policy for imports of unauthorized GM material. The USA is a primary
                 source of supply for the EU‟s highly import dependant feed/livestock industry.
                 BRAZIL - biodiesel exportation: The government would like to encourage regular exportation of soy-based biodiesel, notably to
2009 September   the USA and EU. Reportedly, sustainability studies have been carried out proving that in the country biofuel is produced
                 sustainably and in line with EU norms.
                 PERU - biodiesel imports: The country is reported to have started anti-dumping investigations on biodiesel imports from the USA,
2009 September
                 which could lead to the imposition of countervailing duties.
                 INDIA - ASEAN free trade agreement: The newly signed agreement will include a ceiling of 37.5 percent on India‟s import tariff
2009 September   for crude palm oil. In recent years, the tariff rate ranged between 80 and zero percent. The ceiling could benefit Indonesia‟s palm oil
                 exports to India.
                 EUROPEAN UNION - INDONESIA efforts to encourage sustainable palm oil: Reportedly, the EU could offer incentives to
2009 September   Indonesian producers that adopt sustainable production methods. Supposedly, investment aid, tax exemption or refunds would be
                 considered for companies that succeed in reducing GHG emissions along the production cycle.
                 UNITED STATES - export credit programme: Funding for export credit guarantees has been raised beyond original allocations
2009 September   for selected countries. The measure aims at facilitating trade flows during the current period of slow global economic growth and
                 reduced availability of private credit.
                 EUROPEAN UNION - special market promotion programmes: EU co-financing for 1-3 year market promotion programmes
2009 September   amounting to a total value of Euro 62.1 million has been approved. The commodities covered under the programmes include olive
                 oil.
                 AFRICA - asian rust resistant soybean: A variety resistant to the fungus has been developed within the region and should be
2009 September   available to farmers in time for the 2010 crop, thus enabling farmers to cultivate soybeans without applying costly fungicides.
                 Cultivation in key producing countries, including Nigeria, Uganda and South Africa, should benefit greatly.
                 CHINA - crushing capacity: The country‟s soybean processing capacity is expected to expand further as both, state-owned and
2009 September
                 leading private edible oil producers are reported to be investing into new, large processing plants.
                 Progress in sustainable oil palm: According to a study issued by CIFOR (an international research institute belonging to the
2009 September   CGIAR network), progress in the application of sustainability standards such as those developed by RSPO remains limited. Inter
                 alia, the report points to the need for legal and political reforms at national level to achieve progress.
                 Food processors reduce trans fat presence: Unilever-USA intends to eliminate all artificial trans fats (i.e. those stemming from
                 the partial hydrogenation of oils) from its margarine brands by early 2010. The food company accounts for half the margarine
2009 September
                 spreads sold in the country. Concurrently, Cargill informed that it is reorganizing and downscaling its production of hydrogenated
                 oil as the company needs to adjust to a significant reduction in demand.
                 INDIA - changing stance on GMOs: Reportedly, the government is planning to support the introduction of GM food crops in the
2009 September   country in the coming years with a view to raise crop productivity and thereby contribute to reducing malnutrition and hunger. To
                 date the only GM crop allowed in the country is BT cotton.
                 INDONESIA - palm oil export tax: Following the decrease in the international price for crude palm oil, the country‟s variable
2009 September
                 exports tax has been reduced to zero percent in July and is set to remain suspended also in September.
                 Biodiesel mandatory use: Several countries reported about their plans regarding biodiesel utilization mandates: Coming
                 November, in CANADA, Manitoba will be the first province to introduce a mandatory blend (B2). In URUGUAY, the
                 introduction of B2 was postponed from January to October 2009 due to delays in setting up the fuel distribution system. BRAZIL
                 confirmed its plan to move from B4 to B5 in July 2010, i.e. three years ahead of the originally envisaged date; the higher blending
2009 October
                 level is estimated to push annual biodiesel demand to 2.2 mill tons. In ARGENTINA, mandatory biodiesel use is confirmed to start
                 in January 2010 at the B5 level, implying an annual biodiesel requirement of about 700 thousand tons. The government of
                 ISRAEL has put programmes for the gradual introduction (over the 2009-2011 period) of mandatory blending (B5) on hold along
                 with the planned tax breaks.
                 GM flaxseed: GM flaxseed that is not authorized for food or feed use in the EU has been detected in Canadian shipments to EU
                 member states. Actually, in Canada, which is the EU‟s main supplier of flaxseed, no GM variety of flaxseed is presently registered
2009 October     for commercial production. The country decided to suspend all exports of flaxseed to the EU, while concerned authorities have
                 launched comprehensive investigations with assistance from the industry and in close collaboration with EU counterparts.

                 EUROPEAN UNION - soybean imports: Traces of unauthorized GM material in soybean shipments originating from the USA
                 led to the rejection of cargoes at EU ports. Consequently, importers are reported to have voluntarily suspended purchases from the
                 USA, a major source of supply for the EU‟s heavily import dependent feed industry. Reportedly, the increased uncertainty about
2009 October
                 the European feed industry‟s future supply with soybean meal is causing concern among EU Commission officials as to the
                 viability of the bloc‟s current zero tolerance approach on unauthorized GM material. Pressure for a revision of this policy and for
                 the expeditious approval of new GM varieties seems to be rising.
                 INDIA - GM crops: First steps towards the cultivation of GM crops have been reported with the approval in principle of, inter alia,
2009 October     herbicide resistant soybean varieties by the Ministry of Agriculture. However, approval from the Ministry of Science and
                 Technology and the Ministry of Environment is still outstanding.
                Biodiesel compatible engines: Reportedly, Ford has announced the development of a new diesel engine for a pickup model that
2009 October
                will be fully compatible with biodiesel up to blending ratios of 20 percent.
                CHINA - support to crushers: In an effort to raise sales from state soybean reserves, reportedly the government is considering to
2009 October
                offer a subsidy (amounting to USD 30 per ton) to soybean crushers.
                INDIA - biodiesel consumption: Reportedly, Indian Railways, a major diesel consumer (that also runs 1800 state busses), decided
2009 October
                to get involved in vegetable oil-based biodiesel production to meet its future requirements.
                UNITED STATES - state laws on biofuel use: Reportedly, the implementation of biofuel legislation in individual states is
2009 October    awaiting direction from the federal Environmental Protection Agency as to which type of biofuels will meet anti-carbon pollution
                standards.
                2nd generation’ GM crops: According to a survey carried out in the EU, consumer acceptance of 2nd-generation GM crops
2009 October    featuring output traits that provide benefits such as improved nutritional quality is better than in the case of 1st-generation GM crops
                that only provide producer-related benefits.
                Improved soybean varieties in SE Asia: Reportedly, countries belonging to the Greater Mekong Delta Sub-region (Cambodia,
2009 October    China, Laos, Myanmar, Thailand and Vietnam) see good opportunities to develop suitable, high-performance soybean varieties
                through conventional breeding techniques as opposed to employing genetic modification.
                Food industry - use of vegetable fats: Reacting to feedback from consumers, Cadbury New Zealand is reported to have
2009 October
                announced that it will stop using palm oil in the production of its dairy milk brand chocolate and revert to using only cocoa butter.
                High lauric acid rapeseed: The development of a canola variety with 60 percent lauric acid content (via genetic modification) is
2009 October    reported from Canada. Potentially, the new variety will compete with coconut and palm kernel, the key sources of lauric oil
                traditionally used in the global market.
                Oil palm and rapeseed genome: Important progress in sequencing the genome of the two crops has been reported. The scientific
2009 December   advances are expected to accelerate the development of crop varieties with higher yield potential and better resistance to diseases
                and environmental stress.
                Supply of sustainable palm oil: Estimates based on current RSPO (Roundtable on Sustainable Palm Oil) membership suggest that
                the amount of palm oil certified as „sustainably produced‟ is set to grow significantly in the next years. Reportedly, in May 2009,
                0.5 million tons of certified produce were available; but this figure could rise to 4.5 million tons by end-year, and has been
2009 December
                estimated at 9.3 million tons for 2015. These buoyant estimates assume that all RSPO member companies will progressively certify
                their entire output. Absorbing such amounts would require an expansion in global demand supported by the use of certified palm oil
                in power plants and as biodiesel feedstock.
                Use of sustainable palm oil: Retailer and private label brand Sainsbury‟s in UK has pledged to use, by 2014, exclusively palm oil
                certified as sustainable, or CSPO; reportedly, the decision was taken after the company observed sales increases following the
                introduction of CSPO in certain processed foods. Likewise, Nestle committed to use only CSPO by 2015 (when sufficient
                quantities are expected to be available), and a similar pledge was also made by Marks & Spencer . The gradual change in buying
2009 December
                policies - by which the industry is responding to new consumer concerns - is made possible by increasing supplies of CSPO, the
                possibility to trade certificates and the related decrease in the CSPO price premium - from, reportedly, USD 40 per ton last year to
                USD 10-15 today. Some market participants feel that, as supplies of CSPO continue rising, the price for certified and conventional
                product will eventually converge.
                Monitoring of sustainable palm oil use: Hoping to encourage the use and accelerate global purchases of available sustainable
                palm oil, WWF (a RSPO founding member) has announced the creation of a „Palm Oil Buyers Scorecard‟ - a system to publicly
2009 December   grade leading global retailers, traders and manufacturers of palm oil and palm-based products based on their commitment to
                purchase, use and promote sustainable palm oil. Preliminary results seem to suggest that today only few buyers in Europe are using
                CSPO, despite its increased availability and previous commitment by companies to purchase it.
                Palm oil environmental footprint: Malaysia - a potential exporter of palm oil-based biofuel to the European Union - decided to
                conduct in-depth work on the calculation of the oil‟s impact on the environment. The decision was triggered by forthcoming
                requirements in the EU, by which, from 2010, biofuels should reduce GHG emissions by at least 35% compared to fossil fuels. The
                default value for palm oil current assumed by the EU is 19%. However, biofuel suppliers can claim bigger saving rates by providing
                adequate proof. Currently available studies put GHG saving rates in palm oil in a wide range of 19 to 71%, reflecting rather diverse
2009 December
                and complex methods of calculation. Interestingly, up to half of total GHG emissions in palm oil appear to stem from the release of
                methane gas during the processing stage. Consequently, in Malaysia, efforts are under way to equip palm oil mills with methane
                capturing technology. Reportedly, the issue of GHG emissions is also under debate at RSPO, with members split over the proposed
                incorporation of emission targets into the standards for sustainable production. Experts noted that the market is yet to provide clear
                signals on how it will value efforts by producers to control emissions and feet that, for producers to make commitments, global
                compensation mechanisms will need toUnited in place.
                Edible cottonseed: Researchers in the be put States reported the development of genetically modified cottonseed that is both free
                of gossypol (and hence fit for human consumption) and resistant to insects and diseases. The new variety has the potential to add
2009 December
                protein to the diet of poor people and raise the income of cotton farmers. Further tests and approvals by regulatory bodies are
                required before the seed can be made commercially available.
                PHILIPPINES - trans fat regulation: Earlier this year, legislation regulating the commercialization of trans fat was passed.
                Accordingly, the sale of fats and oils containing significant amounts of trans fats is not allowed; food manufacturers are required to
2009 December   indicate trans fat content on product labels; and trans fat thresholds apply to products that claim to be “free of trans fatty acids”. The
                regulations are expected to contribute to higher consumption of domestic coconut oil at the expense of imported hydrogenated oils.

                INDONESIA - palm oil export tax: The export tax on crude palm oil will remain suspended in December, i.e. for the fifth
2009 December   consecutive month. The base export price has been adjusted upward but remains below the level that would trigger a reintroduction
                of the export tax.
                MALAYSIA - smallholder oil palm support: Reportedly, the government has allocated funds to assist smallholders in adopting
                sustainable production practices and in adhering to the RSPO certification process. Furthermore, during 2009-10, financial
2009 December
                incentives will be provide to smallholders to allow them to participate in replanting programmes aimed at raising yields - from 20
                tons of FFB per ha today to 35 tons in 2020.
                MALAYSIA - mandatory biodiesel use: Compulsory 5% blending was scheduled to come into effect country-wide in January
                2010, but that rate may now be reduced to 3%. In Malaysia, producers of biodiesel are allowed to buy their feedstock, palm oil, at a
                fixed, subsidized price, with the oil palm industry contributing to the funding of this scheme. As the recent strengthening in the
2009 December   market value of palm oil implies a higher subsidy, and considering the very slow uptake of biodiesel consumption so far, the
                government and the oil palm industry plan to contain the outlays for biodiesel subsidization by reducing the compulsory blending
                rate. Furthermore, to spur domestic biodiesel demand, the government has announced that it will drop the 10% tax currently
                applying to biodiesel sales.
                CHINA - soybean production and processing: The government continues to be concerned about the country‟s strong dependence
                on imported soybeans and the uncontrolled expansion in the crushing industry. Reportedly, measures under consideration by the
                government include a subsidy to soybean farmers, the amount of which would be inversely related to the market value of the crop.
2009 December
                Also measures to encourage plantings and processing of groundnut, rape, sunflower and cotton seed will continue, and no new
                soybean crushing projects will be approved and structural improvements in the processing sector will be encouraged.

                CHINA - oilseed procurement and public stocks: Reportedly the government decided to release 2 million tons of soybeans (from
                the 2008 harvest) from state reserves, offering crushers a subsidy of Yuan 210 per ton. Furthermore, public purchases and
                stockpiling of soybeans is set to resume in December and will last until April 2010. The price paid to farmers should be Yuan 3740
2009 December   per ton, or about 1% above last season‟s procurement price, while the crushing subsidy could be reduced to Yuan 160 per ton. In
                line with its effort to support farmers and stabilize domestic output, the government also announced that it will buy 1 million tons of
                rapeseed (in addition to the 5 million tons planned last June) at a price of Yuan 3700 per ton. Reportedly, by end September, 3.8
                million tons of rapeseed had been procured.
                CHINA - rapeseed imports: As of November 15th, rapeseed shipments entering the country are required to be certified free of
                blackleg disease for phytosanitary reasons - a regulation that hurts in particular exports from Canada (and possibly Australia),
                where the disease is no longer a major threat, but continuous to be present. The three countries are involved in negotiations about a
2009 December
                possible delay in the implementation of the new regulation and about alternative risk mitigation measures. Meanwhile, rapeseed
                crushers in China are expected to turn to domestic supplies, including the ample government stocks accumulated during the past
                season.
                INDIA - biodiesel exportation: An international biofuel producing company has reported a first shipment of biodiesel from India
2009 December
                to a customer in Europe.
                INDIA - vegetable oil exports: The temporary ban on bulk shipments of vegetable oils introduced in early 2008 (to secure
2009 December
                domestic supplies and contain price rises) has been extended until October 2010.
                INDIA - commodity exchange: Reportedly, the Indian Commodity Exchange has become operational end November and
2009 December
                commodities traded include soy oil.
                BRAZIL - soybean moratorium: The moratorium on buying soybeans planted on land illegally cleared in the Amazon region has
2009 December   been extended for a 4th year. Meanwhile, NGOs have launched discussions on the environmental effects of converting vast tracts of
                Savannah into arable land, in particular for cultivating soybeans.
                BRAZIL - currency policies: Reportedly, the government is determined to tax foreign investments in an effort to prevent further
2009 December   appreciation of the national currency vis-à-vis the US dollar. The strength in the Real tends to raise input costs for farmers and
                erodes export earnings - for instance from soybean sales.
                BRAZIL - mandatory biodiesel use: In recent years, the government accelerated the introduction of mandatory blending rates
                (inter alia to make better use of the installed production capacity), and compulsory 5% blending is set to come into force nation-
2009 December
                wide in July 2010. Now the government was reported to consider gradually moving to 20% blends in big cities by 2015, which is
                estimated to raise annual biodiesel consumption to 5.5 million tons.
                COLOMBIA - biodiesel mandatory use: biodiesel blending of 10% will become compulsory in January 2010 - up from 5% in
2009 December   2009. The new target is estimated to translate into an annual requirement of 500 000 tons of biodiesel - entirely based on domestic
                palm oil, production of which is set at 0.8-1 million tons in 2010.
                ASEAN free trade agreement: The agreement (referred to as AFTA) is set to take effect next January, implying the introduction
                of common preferential tariffs ranging between 5 and zero percent for all products, including those previously deferred under
2009 December   sensitive lists. The six founding members of ASEAN agreed to immediately reduce their tariffs on key agricultural products -
                including soybeans as well as soy, palm and coconut oil - to zero. This measure is expected to affect internal trade patterns, with the
                most competitive producers likely to gain market shares.
                AFRICA - new investments in oilseed production: Several countries in the region are reporting renewed interest in oilseeds, in
                particular as biodiesel feedstock. Government backed, large scale commercial production of biodiesel is planned in RWANDA,
                where a private consortium is ready to develop 10 000 ha of jatropha, aiming at the production of 16 million litres of biodiesel
                annually. Other biodiesel feedstock under consideration include, high-altitude oil palm, moringa, castor and soy. KENIA has
2009 December   introduced a plan for developing biodiesel from jatropha and other locally grown trees and is eyeing a biodiesel blending ratio with
                fossil diesel of 5%. Comparable plans have also been launched in ETHIOPIA, focusing on castor, jatropha and oil palm cultivation
                on arid land not used for food crops. In LIBERIA, the government is securing major investments in oil palm by private companies
                from Malaysia and Indonesia, expecting significant improvements in livelihoods and social welfare in poor regions, industrial
                development and new export earning opportunities. Meanwhile, in UGANDA, NGOs have criticized large scale investments in oil
                palm for giving insufficient rules: A new law regulating the importation of concerns. Exposed to similar criticism and concerned
                TURKEY - GMO import regard to environmental regulations and social GMO material that has come into force end October
2009 December   started to negatively affect the country‟s imports of soybeans and soy meal. Foreign rape and sunflower seed, where non-GMO
                material is readily available, are expected to partly fill the gap.
                UNITED STATES - groundnut policy reform: The government reported that landmark policy changes enacted in the early
                2000s transformed the national groundnut sector by eliminating longstanding supply controls and restrictions. Guided by market
2009 December   forces, the industry is reported to have adjusted quickly, resulting in fewer and larger farms in the regions best adapted to
                production. Total area of and prices for groundnut have fallen, but more efficient and competitive production supported renewed
                demand growth, especially in export markets.
                UNITED STATES - biodiesel tax credit: The tax credit of USD 1 per gallon introduced in 2004 is set to expire at the end of the
                current year. The tax concession has contributed to making biodiesel an economically viable alternative to conventional diesel.
2009 December
                Legislation extending the tax credit by 5 more years - to allow the biodiesel industry to grow further - is reported to be under
                consideration.
                UNITED STATES - rapeseed meal imports: After detecting harmful salmonella bacteria in shipments from Canada, the US Food
                and Drug Administration introduced import alerts on rapeseed meal plants operated by major processors in five Canadian
2009 December   provinces. The alerts allows inspectors to detain shipments at the border. In the United States, zero tolerance applies to salmonella
                bacteria. Reportedly, the import measure resulted in a reduction in crushing and a redirection of meal exports to other markets in
                Canada.
                EUROPEAN UNION - approval of GMO maize: Importation and consumption of four new GMO maize varieties has been
                officially approved. The decision is expected to lead to a resumption (in December) in soybean and meal imports from the United
2009 December
                States. Shipments had come to a halt during September, after small traces of still unapproved GMO maize were detected in some
                cargoes.
                EUROPEAN UNION - butter market intervention: Due to continued oversupply and persistently low prices, public buying into
2009 December   intervention has been allowed to continue uninterrupted until February 2010, i.e. the start of next year‟s official intervention period
                (which normally runs from March to August only). The measure aims at stabilizing milk prices for dairy farmers.
                EUROPEAN UNION - biofuel environmental footprint: EU standards for calculating the footprint of biofuels and their
                feedstock are expected to be reviewed during 2010, once the EU releases new guidelines for calculating the impact of indirect land
                use changes (ILUC). In the meantime, a group of NGOs has claimed that the EU‟s current renewable fuel targets could increase
2009 December   rather than reduce overall GHG emissions in the transport sector, and, accordingly, recommended to replace current energy-based
                targets with purely GHG-based targets, including life-cycle impact assessments and ILUC indicators. In addition, also the EU‟s
                recent assessment that biofuel production in the EU can be increased via productivity gains and improved second generation
                technologies - rather than major expansions in area - has been questioned.
                EUROPEAN UNION - private sector complaint against US biodiesel export practices: Claiming that US biodiesel
2009 December   producers/exporters are circumventing the EU‟s anti-dumping and countervailing duties, the European Biodiesel Board (EEB)
                announced that it will lodge a new complaint to the EU trade authorities.
                RUSSIAN FEDERATION - import tax on tropical oils: According to private sources, the 10% temporary tariff - introduced last
2009 December   June to afford protection to the domestic dairy industry - could be lifted in January in an effort to address a domestic shortage in
                vegetable oil that is expected to arise from reduced domestic crops.
                SOUTH AFRICAN REPUBLIC - trans fatty acids legislation: The government is developing legislation aimed at reducing
                certain trans-fats in processed and prepared foods so as to contribute to the reduction of chronic diseases associated with the
2009 December   presence of TFAs in the diet. The proposed law would affect especially the use of partially hydrogenated vegetable oils, while
                naturally occurring TFAs in animal fats would be excluded. Comparable legislation is already in place in Denmark, Canada and the
                United States.
               INDONESIA - palm oil shipment facilities: Reportedly, official sources announced plans to build three new ports for shipping
               palm oil to handle rising output in the world‟s top producing country. Traders reported that congestions at ports are increasingly
2010 January
               hampering exports from the country. The government is also planning to provide incentives to boost the development of the palm
               oil industry at the downstream level with a view to raise value addition and provide more employment.
               INDIA - trans fat regulation: The Food Safety and Standards Authority of India was reported to consider introducing a 10% limit
               on the amount of trans fat contained in partially hydrogenated vegetable oils (notably vanaspati or vegetable ghee). The limit could
2010 January
               come into effect in 2010 and would be reduced to 5% during the three subsequent years. The measure is being considered as a
               means to lower the incidence of cardiovascular diseases.
               INDONESIA - palm oil export tax: Following the rise in the international price for palm oil beyond 750 USD, the government
2010 January   has announced the reintroduction of the export tax on crude palm oil at 3% in January 2010. The tax had remained suspended since
               August 2009.
               MYANMAR - vegetable oil importation: Reportedly, the country‟s health ministry has banned the importation of selected brands
2010 January   of vegetable oils of Thai and Malaysian origin on the basis that these contain chemical colour agents that do not conform with the
               relevant health standards.
               ARGENTINA - mandatory biodiesel use: A delay in the implementation of the 5% mandatory biodiesel blending into
2010 January   conventional diesel from January to March 2010 has been reported, Apparently, negotiations between the government and biodiesel
               producers regarding the required adjustments in infrastructure could not be completed in time.
               REPUBLIC OF KOREA - biodiesel support: Reportedly, the government has decided to raise mandatory biodiesel blending to
2010 January   2% in 2010 compared to the 2009 level of 1.5%. In addition, also the tax due on diesel fuel will be waived. Korea started blending
               with biodiesel in 2006 as the first country in Asia.
               INDIA - coconut support: A new insurance scheme for coconut farmers has been launched in Kerala, the country‟s main coconut
2010 January   growing state. Farmers are expected to pay 25% of the insurance premium, while the remainder will be borne by the federal and
               state government.
               EUROPEAN UNION - biodiesel tax breaks: NORWAY decided to significantly reduce the tax break enjoyed by biodiesel; the
               measures is taking effect in January 2010. Similarly, ITALY plans to drastically cut the biodiesel quota that enjoys reduced excise
2010 January
               duty. By contrast, in GERMANY, the government decided to postpone the gradual rise in taxes levied on biofuels that was to be
               implemented from 2010 onward.
               UNITED STATES - biodiesel tax credit: The US House of Representatives has approved the extension of the USD 1 per gallon
               tax incentive - which was due to expire on 31 December 2009 - by one year, i.e. through the end of 2010. Now final approval is
2010 January
               required by the Senate. According to industry sources, biodiesel production could become uneconomic in the absence of the tax
               credit.
                Sustainable palm oil: Reportedly, at a recent RSPO meeting, WWF reported that despite the availability of safe, environmentally-
                friendly palm oil options, Western companies did not appear to meet commitments to only buy sustainably produced palm oil. The
                organization found that, while RSPO members were increasingly adopting improved production practices, the major issue of GHG
                emissions involved in land use changes was not adequately addressed and that related measures continued to be of a voluntary
                nature only.Meanwhile, global consumer goods company Unilever decided to suspend purchases of palm oil from a particular
2010 January
                supplier in Indonesia until the same could prove that its plantations were not damaging high conservation value forests nor
                expanding onto peatland areas. In the meantime, official sources in INDONESIA confirmed the national target to expand total area
                under oil palm to 18 mill ha (from today‟s level of 9.7 mill ha) - while fully adhering to social, economic and environmental
                sustainability standards. Allegedly, the expansion was needed to allow the country meeting its commitments regarding overall
                reduction in GHG emissions. In COLOMBIA, the government seems determined to promote environmental and social certification
                in palm oil-based biofuel production. It claims that the government has announced that all foreign soybeans purchases will become
                CHINA - soybean import licensing: Reportedly, current oil palm production and the sector‟s planned expansion does not threaten
2010 January    subject to an automatic import license system. The measure would facilitate monitoring the flow of soybean imports into the
                country. Among traders, concern has been voiced that the new licensing system could delay shipment operations.
                THAILAND - exports of palm oil under AFTA: Thai sources estimate that as a result of the common preferential tariffs recently
2010 February   introduced under the ASEAN Free Trade Agreement (AFTA), the country will loose 2.6% or US$ 46 million of its export business
                to Malaysia.
                ASEAN - CHINA free trade area (ACFTA): The trade agreement has come into force at the same time as trade got liberalized
                within the ASEAN block itself. Under the accord, China and the six founding ASEAN countries (Brunei, Indonesia, Malaysia, the
                Philippines, Singapore, and Thailand) will remove tariffs on 90 percent of imported goods. The other four ASEAN members
2010 February   (Cambodia, Laos, Myanmar, Vietnam) will follow suit in 2015. As to oilseeds, oils and meals, ASEAN exports of palm oil
                (primarily from Malaysia and Indonesia) are expected to benefit from improved access to the Chinese market. Palm oil, which
                belongs to the list of sensitive products, will see its import tariff reduced from 30 percent to 9 percent, and further reductions are
                scheduled for the coming years.
                CHINA - rapeseed state reserves: The country‟s rapeseed stockpiling programme continues to be active: reportedly, state agency
                Sinograin bought 4.05 mill tons by last December and the purchasing programme has been extended to February 2010. The
2010 February
                operations, which include a fix price offered to farmers, tend to stimulate traders‟ interest for cheaper rapeseed imported from
                abroad.
                CHINA - soybean crushing capacity: With new crushing facilities expected to come on-stream this year, the country‟s annual soy
                processing capacity could approach 100 million tons. However, the current capacity utilization rate is estimated at less than 50%.
2010 February
                Reportedly, the government could reject new applications for processing plants or expansions with a view to curb over-capacity.

                INDIA - soybean futures trading: Reportedly, soybean processors are calling for curbs on futures trading in soybeans. They are
                concerned about the recent hike in domestic soybean prices - which affect the country‟s soymeal export prospects - and claim that
2010 February
                futures operations have contributed to the rise in prices. The concerned regulatory bodies have rejected these requests, saying there
                was no evidence for the suggested effect on prices.
                INDONESIA - infrastructure development: Delegations of government and business leaders from Indonesia and Japan started
                discussing a project under which Indonesia - assisted by Japanese private companies - will accelerate infrastructure development in
2010 February
                selected regions to assist industrial growth. The initiative is expected to benefit the palm oil industry and allow further growth in the
                sector.
                KENYA - domestic market competition: The country‟s Commission on Monopolies and Prices reportedly has ordered in-depth
2010 February   investigations into activities of edible oil producers and distributors for possible cartel activities and collusion to control domestic
                prices taking advantage of market dominance.
                LIBERIA - oil palm investment: A major Indonesian oil palm operator is reported to consider investing in Liberia‟s oil palm
                industry. Negotiations with the government on a concession agreement are reported to be on-going. The project will have to
2010 February
                conform fully to the country‟s environmental master plan and standards. The investment plan envisages the development of up to
                240 000 ha (including 40 000 ha run by out growers), and would produce over one million tons of palm oil per year.
                UGANDA - oil palm development: Reportedly, the government has released new funds to expand oil palm growing in the country
                via public-private partnerships. Also, a palm oil pricing committee has been set up to ensure adequate returns for farmers. Public
2010 February   funds will be made available for purchasing land, and district leaders have been urged to allocate more land for oil palm cultivation.
                Meanwhile, according to private sources, under an on-going public-private project, the government has been asked to make
                available for oil palm growing grassland portions that belong to a forest reserve.
                AUSTRALIA - GM rapeseed: Reportedly, the government has announced that, from this year, GM rapeseed may be grown in the
2010 February   country. Once GM varieties enter the market, trade with the EU - where importation of GM material is subject to specific
                regulations - could be affected.
                CANADA - effects of biofuel production: Reportedly, the government has commissioned a study on possibly harmful
2010 February   environmental effects associated with the production of biofuels. Official sources pointed out that the commissioning of the study
                does neither presuppose that there are any such effects nor alter the government‟s commitment to renewable fuels.
                CANADA - support to rapeseed sector: The government and the Canola Council of Canada will together invest in the
                development of a comprehensive market strategy for the rapeseed sector. The initiative aims at improving access to international
2010 February
                markets. Measures will include the examination of non-tariff trade barriers and the promotion of best practices so as to meet the
                standards of importing countries.
                GATES FOUNDATION: A reputed biotech expert with extensive experience in the development of genetically modified seeds
                has been appointed as head of the Foundation‟s Agricultural Development Program. In recent years, the foundation focused much
2010 February
                of its agriculture efforts on helping small farmers improve production and commercialization of their crops. In addition, the
                foundation started to invest in higher tech solutions for combating hunger and disease.
                Jatropha curcas genome: Although considered a promising biofuel crop for developing countries, jatropha‟s off-take as a
                commercial crop has so far been hampered by the absence of certified plant material with proven yield potential. Reportedly, to
2010 February
                address this problem, a group of science companies in the United States is committed to work on the plant‟s genome and on the
                systematic introduction of promising traits, so as to develop stable, high performance and region-specific cultivars.
                GM soybean beneficial to consumers: Most GM soybean varieties developed to date were designed to help farmers by making
                weed and disease control easier. Now Monsanto is ready to launch a new variety that - rich in omega-3 fatty acids - promises to
2010 February
                deliver health benefits for consumers. Researchers generally concur that omega-3 fatty acids are helpful in combating
                cardiovascular diseases and can benefit the brain.
                UNITED STATES - revised Renewable Fuels Standard: The new programme (referred to as RFS-2) that came into effect last
                month sets the target for national consumption of biomass-based diesel in 2010 at 0.65 billion gallons, corresponding to 1.1% of
                total diesel sales, to which the 0.5 billion gallons that were not consumed last year can be added. Reportedly, 20% of the target may
                be carried into 2011. The mandate will increase gradually in 2011 and 2012, while subsequent targets will be determined later.
                Furthermore, starting this year, measurement of GHG emissions during fuel and feedstock production, distribution and use will
2010 March
                include emission stemming from indirect land use changes. Biomass-based biodiesel must lead to at least 50% reduction in lifecycle
                GHG emissions compared to petroleum-based diesel. According to the new RFS-2 standards, soy oil and waste oils, fats, and
                greases all comply with this requirement. Reportedly, the default GHG emission savings of soy oil-based biodiesel has been set at
                57%, which, depending on the production method, can even reach 85%. For domestically produced feedstock no additional
                certification will be required. As to competing palm oil, it may or may not meet the requirements depending on how it is produced;
                compliance will be determined based on certification EU‟s latest official notification to the WTO - which covers the period up to
                EUROPEAN UNION - agricultural support: The provided by the producer. Overall, under RFS-2, demand for soybeans as
                2006 - shows a significant increase in total farm support outlays since 2002. Reportedly, total support outlays added up to Euro
                90.7 billion in marketing year 2006/07, compared to 75.6 billion in 2002, when the level of support reached a fifteen- year low. The
                rise is due to a surge in “green box” payments, i.e. subsidies that have no, or only minimal effects on trade or production. This surge
2010 March
                is only partly offset by a drop in “amber box” (most trade distorting, production-linked) payments and “blue box” (production
                limiting) payments. Since 2005, oilseed producers - and arable crop producers in general - benefit primarily from green box
                payments, notably the „single farm payments‟ that are decoupled from production and thus exempted from reduction requirements
                under WTO.
                INDONESIA - palm oil exports: According to official sources, the country plans to limit exports of crude palm oil at 50% of
                output by 2015 and 30% by 2020 - in an effort to boost the domestic downstream processing sector, thereby creating employment.
                To attract the required capital for investment, the government would provide fiscal incentives and encourage banks to lend at
2010 March
                reduced interest rates. Currently, well over 50% of palm oil exports are in crude form. Reportedly, the industry expressed concern
                over these plans, pointing out that such policies could induce importing countries to raise tariffs on refined palm products - also in a
                bid to encourage refining and downstream processing at the local level.
                INDONESIA - PAKISTAN, oil palm trade: Indonesia is reported to be negotiating with Pakistan about its import tariff for palm
                oil. Currently, due to a preferential trade agreement that Pakistan signed with Malaysia in 2007, Indonesian palm oil is subject to a
2010 March
                higher tariff than produce coming from Malaysia. Indonesia aims to have its exports charged with the same tariff enjoyed by
                Malaysia.
             CHINA - sales from state soybean reserve: Some 200 000 tons will be released from state reserves in a move to free public
             storage space. During 2008/09 marketing year, total state purchases amounted to 7 million tons. However, according to market
2010 March   sources, the state-set purchase/selling price of 3774 Yuan per ton is both, too low for soybean farmers to sell and too high for
             soybean processors to buy: rising domestic production costs and competitively priced imports continue to threaten the market for
             home-grown soybeans.
             UKRAINE - sunoil export quota: Reportedly, the government is considering to reinstall temporary export quotas for sunflower
             oil. At their current pace, export activities tend to result in domestic shortages, price rises and idle crushing capacity. Monthly
2010 March
             shipments could be capped at 159 thousand tons, which compares to recent sales of 200 thousand tons. The last time such quotas
             were in place was in mid 2008.
             Spread of GM oilseeds: According to ISAAA (the International Service for the Acquisition of Agri-Biotech Applications), in
             2009, GM soybeans accounted for three-quarters of global soybean plantings (or two-thirds, when FAO data for total area are
2010 March   used). Herbicide tolerant GM soybeans remained the world‟s principal biotech crop in 2009, occupying over 50% of the global area
             cultivated with GM crops. Another 5% of the global GM crop area is occupied by biotech rapeseed. Globally, one out of five
             hectares planted to rapeseed use GM varieties.
             BRAZIL - new GM soybean: A herbicide-tolerant soybean jointly developed by private company BASF and public research
             institute EMBRAPA has received approval for commercial cultivation by the relevant national authorities. The first genetically
2010 March   modified crop developed within Brazil will become available in the 2011/12 season. Meanwhile, the owners will seek approval in
             key overseas export markets and also initiate work on the crop‟s adaptation to production and regulatory conditions in neighbouring
             countries that produce soybeans.
             Non-GM, herbicide tolerant plant: In Europe, a patent has been granted for the production of a non-transgenic plant tolerant of
             glyphosate and other widely used herbicides. Reportedly, tolerance is achieved by using the plant‟s natural processes and without
2010 March   the introduction of foreign genetic material. This way, farmers would be offered a non-GM alternative that still enables them to
             maximize yields of key crops. Commercial application, if materialized, could prove interesting in countries where cultivation of GM
             material is subject to restrictions.
             Biodiesel compatible cars ex-factory: General Motors announced that its new models of heavy- duty diesel pick-ups will have
2010 March
             certified B-20 biodiesel capability (B20 is a blend of 20 percent biodiesel and 80 percent conventional diesel).
             AUSTRALIA - cultivation of GM rapeseed: After the states of New South Wales and Victoria, cultivation of GM rapeseed has
2010 April   also been approved in Western Australia. With the addition of the country‟s most important rapeseed growing state, GM varieties
             will now be allowed on almost 90% of the country‟s rapeseed area.
             CHINA - soyoil import regulations: According to industry sources, the government is considering to tighten the procedures for
2010 April   granting import permissions for soybean oil and to enforce stringent rules on maximum solvent residue levels in imported oils. If
             introduced, such measures would affect nations exporting soybean oil to China, notably the country‟s main supplier Argentina.
             INDIA - agricultural support: The newly released 2010/2011 federal budget contains provisions to support agriculture as a
             whole, notably measures to ease the credit flow into the sector, to bring down input costs and to attract private investment into
             agriculture - especially for sugar and foodgrain warehousing as well as for cold storage. It also includes plans for extending the
2010 April   green revolution to the eastern region of the country and for organizing „pulses and oil seed villages‟ in rainfed areas so as to
             enhance productivity in dryland farming and promote conservation practices. Other, nation wide initiatives to encourage oilseed
             production and improve productivity in that sector were not reported, nor plans to bring vegetable oil import duties back to their
             historic level.
             INDONESIA - palm oil export tax: In response to rising global palm oil prices, in April, the ad valorem export tax will be raised
2010 April
             to 4.5% in April (from the 3% rate applied since last January).
             INDONESIA - oil palm futures: The Indonesia Commodity and Derivatives Exchange is ready to launch a crude palm oil futures
2010 April
             contract in April with a view to create a local benchmark price.
             PERU - antidumping duties on US biodiesel: Reportedly, the provisional anti-dumping duty imposed late last year on imports of
2010 April
             100% biodiesel from the US has been revoked in March.
             UNITED STATES - biodiesel tax break: The tax credit of 1 USD per gallon of marketed biodiesel - which expired last
             December, negatively affecting the profitability of biodiesel production - has been retroactively renewed until the end of 2010. To
2010 April
             be enacted, a final bill still has to be issued. With the renewal, demand for soybean oil and other feedstock for biodiesel is set to
             resume. Currently, around 10% of annual soy oil output is absorbed by the biofuel industry.
             Sustainable palm oil supply: RSPO has estimated current global supply of palm oil certified to comply with its sustainability
             criteria at 1.5 million tons per year, mostly coming from Malaysia. By the beginning of 2011, supply should double to 3 million
             tons as the number of certified plantations continues to rise. Due to the on-going expansion of supplies, the premium for certified
2010 April
             palm oil is reported to have fallen from 50 USD per tonne at the end of 2008 to USD 10 today. While this should spur demand for
             certified oil, it could also discourage producers from shifting to the more expensive methods required to produce and market
             sustainable palm oil.
             Environmental concerns in palm oil trade: Information published by environmental NGOs regarding alleged illegal land-clearing
2010 April   and improper land conversion by selected oil palm plantations in Asia could lead major traders and end-users of palm oil (including
             Cargill , Nestlé and Unilever ) to shift sources of supply depending on the outcome of on-going investigations.
             ARGENTINA - mandatory biodiesel blending: Reportedly, the long announced B5 blending mandate has come into force in
             March. Private sources estimate the amount of biodiesel required per year to fulfil the mandate at 860 000 tonnes. Total biodiesel
2010 April
             production in 2010 is forecast between 1.6 and 2.2 mill tons (compared to 1.2 mill in 2009), part of which will be exported.

             MALAYSIA - mandatory biodiesel blending: After a number of postponements, the government is reported to be ready to
2010 April   implement B5 blending in June this year and to make available public funds to defray the costs associated with production and
             distribution.
             Chicago futures markets: Coming May, the CME Group Inc. intends to launch an electronically traded, US$-denominated
             futures contract for crude palm oil using the Bursa Malaysia Derivatives ringgit-denominated benchmark. The partnership
2010 April
             between the two platforms aims at offering an alternative means of hedging risk to companies that trade in dollars and creates new
             opportunities for cross-trading with soybean oil.
             CHINA - state purchases of rapeseed: Reportedly, government purchases of rapeseed for state reserves will continue this year.
2010 May
             The official buying price has been set at CNY 3900 per ton.
             ICELAND - volcano eruption: The impact of the emission of volcanic ash on agricultural production in Europe and the CIS area
             is reported to be negligible as the magnitude of the eruption was not big enough to significantly affect regional weather patterns.
             However, the prolonged disruption of air travel across Europe has significantly affected parts of agricultural trade between Europe
2010 May
             and the developing world: producers of horticultural products, cut flowers and other perishable goods in particular in Africa
             suffered greatly as they entirely rely on air transport and cannot easily divert to other markets. Trade in bulk commodities like
             oilseeds and derived products rely on shipment by sea and thus have not been affected.
             EAST AFRICA - oilseed supply shortages: Reportedly, limited availability of locally grown oilseeds is causing oil crushing and
2010 May     refining plants to work below their installed capacity. Concerned processors use oil palm (Uganda) and sunflower and cotton seed
             (Tanzania) as raw material. Cooking oil consumption in both countries remains heavily dependant on imported oils.
             EUROPEAN UNION - environmental sustainability of biofuel use: A study prepared by IFPRI (on behalf of the EU
             Commission) states that, at the currently assumed consumption levels - namely biofuels accounting for 5.6 percent of transport fuels
             in 2020 - the environmental sustainability of biofuels is not significantly reduced when the effects of indirect land use changes
             (ILUC) are taken into account. Above the 5.6% share, however, ILUC emissions could rapidly increase, potentially eroding the
             environmental sustainability of biofuels. For biodiesel, the study assumes that most of the required production increase comes from
2010 May
             domestically grown rapeseed. It also claims that the environmental sustainability of palm oil-based diesel remains similar to that
             derived from rapeseed oil, even when peatland emissions are taken into account. To achieve maximum GHG emission reductions,
             the study recommends that import demand concentrate on more sustainable sugar cane ethanol. Also, the removal of import tariffs
             for biofuels is recommended as this should allow production and consumption to shift towards more emission-efficient biofuels, in
             particular sugar cane ethanol. The study has further fuelled the debate on the suitability of different biofuels and the implication of
             INDIA - new rapeseed futures: future EU production and import volumes and on the related direct/indirect land have launched
             different targets. Assumptions on The National Commodity & Derivatives Exchange Ltd. (NCDEX) is reported to use changes a
2010 May
             rapeseed futures contract last month in the Northern state of Haryana.
             PERU / CHILE - fishmeal and oil production constraints: Output from the world‟s leading supplier Peru is anticipated to
             decline further in 2010. To protect marine resources during the on-going El Niño weather pattern, the government has limited the
             2010 catch in the country‟s main fishing areas to 2.5 mill tons (compared to an average of 3.8 mill tons in the past five seasons),
2010 May
             and the fishing season will be opened only on 13 May (compared to last year‟s 20 April). The cuts hit world markets at a time when
             global supplies are already reduced following the massive, earthquake related damage to fish processing plants in Chile, the second
             biggest exporter of fish meal and oil.
            GERMANY - biofuel legislation: In line with the EU Renewable Energy Directive, last year Germany prepared national
            legislation introducing the need to proof sustainability via an officially approved certifier if biofuels were to be eligible for tax
2010 May    incentives and count towards national targets. Originally scheduled to come into effect on 1st July 2010, implementation has now
            been postponed to 1st January 2011. According to private sources, under the regulation rapeseed oil could be considered as a more
            sustainable biodiesel feedstock than palm oil or soy oil.
            UNITED STATES - rapeseed meal imports: While the strict control system regarding possible salmonella contamination in
            rapeseed meal originating from Canada remains in place, another crushing plant in Canada has been added to the import alert list.
2010 May
            The restrictions have lead to a temporary reduction in shipment from Canada as the USA represents Canada‟s main client for
            rapeseed meal.
            Progress in sustainable palm oil - use of certificates: Unilever reports to have secured enough certificates of sustainable palm oil
            to cover the entire requirements of its business in Europe (as well as in Australia and New Zealand). The effort is part of the
            company‟s commitment to source all its palm oil from sustainable sources by 2015. Unilever uses a certificate trading programme
2010 May    (GreenPalm ) which allows palm oil producers that follow RSPO‟s criteria for environmentally and socially sustainable farming to
            increase their earnings by selling certificates. Until properly segregated supply chains for sustainable produce become widely
            available, certificates are used as an option to encourage growers to comply with RSPO requirements and certify their plantations as
            sustainable.
            Progress in sustainable palm oil - segregated supply chains: Global vegetable oil supplier IOI-Loders Crocklaan Europe
            announced the imminent sale of fully segregated, RSPO-certified palm oil. The company claims to be the first supplier in
2010 May    continental Europe. Sales are scheduled to begin once a new refinery featuring the technology and storage capacity that is required
            to fully segregate sustainable palm oil from all other oils opens in June 2010. The new chain should permit full traceability and
            would allow manufacturers to claim that a given product only contains certified sustainable palm oil.
            Progress in sustainable palm oil - INDONESIA certification initiative: Reportedly, the agricultural ministry of Indonesia is
            planning to set up a national certification scheme for sustainably produced palm oil (Indonesian Sustainable Palm Oil, ISPO ). The
            scheme, which could become operational before the end of 2010, aims at protecting sales to markets where environmental concerns
2010 May
            are important. Details on how the certificates would be granted are not yet available. The initiative follows reports about important
            buyers like Unilever and Nestlé suspending purchases from certain Indonesian suppliers on environmental grounds.

            Trials with 100% renewable diesel: Finnish refining and marketing company Neste Oil reports that it started testing diesel fuel
2010 May    based exclusively on renewable raw materials on a range of different cars. Allegedly, the fuel allows a reduction in GHG emissions
            of 40-80% compared to conventional fossil diesel.
            AFRICA - biofuel production and legislation, BOTSWANA: Reportedly, the country is set to join the list of African producers
            of jatropha-based biodiesel. Preparations are underway to build a plant with an annual capacity of 50 million litres. Before
            sufficient quantities of jatropha oil become available, tallow and used cooking oil will be the main feedstock. Under the government
2010 July
            backed project, initially 170,000 ha of land will be planted with jatropha. Once developed, plantations are supposed to be leased to
            private companies as well as to local farmers. Biodiesel production aims at both the domestic and export market.
            AFRICA - biofuel production and legislation, ANGOLA: Recently passed legislation regulating production of biofuels requires
2010 July   foreign-owned biofuel companies to sell part of their output to state-controlled oil companies with a view to meet local needs.

            AFRICA - biofuel production and legislation, EAST AFRICA: Croton megalocarpus , a tree crop that produces oil-rich nuts,
            could soon be added to the list of African biodiesel feedstock. The tree, which takes 11 years to reach full maturity, is reported to
            grow well in semi-arid climates. Its oil is non-edible. Reportedly, a private company in Tanzania is ready to invest in commercial
2010 July
            production, partly in collaboration with local small farmer cooperatives. Work on feedstock specific crushing technologies has
            started. In Tanzania as well as Kenya, biofuel policies are reported to specifically stimulate private sector initiatives.

            AFRICA - biofuel production and legislation, MOZAMBIQUE: Reportedly, the country envisages drafting its own set of
            sustainability criteria for biofuel production - as opposed to criteria formulated by policy makers or the industry in more developed
            nations. The objective is to address the country‟s specific needs before meeting the requirements of others. Food security
2010 July   considerations as well as the reduction of expensive and volatile petroleum imports will likely feature high on the list of criteria,
            compared to, for example, biodiversity preservation. According to independent experts, the main challenge will be to ensure that
            sustainability schemes and national policies result in the adoption of best production and management practices by the private
            sector and NGOs.
            AUSTRALIA - biodiesel importation: Reportedly, a local biodiesel producer has filed a complaint against dumping of US-origin
            biodiesel on the Australian market. Allegedly, the imported biodiesel enjoys unfair advantages in that, in addition to US subsidies,
2010 July
            it receives financial support through Australia‟s Cleaner Fuels Grant, which is offered to both domestically produced and imported
            product. The claim is being investigated and could lead to the introduction of anti-dumping duties.
            AUSTRALIA - GM rapeseed: The cultivation of GM rapeseed seems to be expanding steadily. Following the approval of GM
            varieties in Western Australia, about 20% of the nation‟s overall rapeseed area is now estimated to have been planted with GM
2010 July
            varieties. This development may pose challenges regarding the crop‟s commercialization on overseas markets that are characterized
            by strict biotech policies and specific consumer concerns vis-à-vis GM products.
            BELARUS - rapeseed export duty: Reportedly, a variable export duty will apply to rapeseed exports from June 2010. Initially set
2010 July   at 100 € per ton, the new tax aims at maximizing domestic processing of rapeseed, given the recent increase in the country‟s
            rapeseed processing capacity.
            BRAZIL - support to agriculture: In the 2010/11 federal budget, total outlays for agriculture will rise about 10 percent over
            2009/10. Emphasis will be on production and marketing credits at subsidized rates (with most support going to family farms as
            opposed to commercial enterprises), as well as investment loans, rural insurance and risk management schemes, improved assistance
2010 July
            to medium size farms, and a new programme in support of low GHG emission agriculture. Loan limits per beneficiary shall be
            raised for all products; the limit for soybeans will rise from Reais 450,000 to Reais 500,000 per farm. Minimum prices will remain
            unchanged for all products.
            BRAZIL - oil palm expansion: Backed by the state as well as federal government, oil palm cultivation seems poised to expand in
            the Amazon region. The large-scale private investments planned in one of the country‟s poorest regions are supposed to produce
            wealth via employment creation and income generation. Under the project, palm oil will be processed into biofuel for both domestic
2010 July
            consumption and export. Allegedly, the project will contribute to reducing deforestation; plantations shall be established on
            previously deforested land and environmentally friendly practices are to be employed throughout the production chain.

            CHINA - import requirements for Canadian rapeseed: Importation of Canadian rapeseed into China is expected to continue in
            2010/11 notwithstanding the phytosanitary limitations in place since November 2009. Reportedly, the two countries have agreed to
            extend the transitional measures negotiated last year to avoid a strict ban on imports based on possible blackleg disease
            contamination. US soya oil: Following the recent curb on imports from Argentina (based on the detection of high solvent residue
2010 July   levels), the United States may supply soya oil to China on the condition that official quarantine certificates are provided. In the past,
            the US was not in a position to provide such certificates due to different food quarantine systems. Apparently, now an agreement
            has been reached on certification procedures. Argentina soya oil: In the last week of June, Argentina reported that it had reached
            an agreement with China to discontinue the import restriction applying to Argentinean soya oil. Official confirmation of this news
            is still awaited from China.
            CHINA - state purchases of soybean: Introduced in 2008, government supported purchases of soybeans in the country‟s North-
            eastern production basin is likely to continue this year. By end March 2010, state-run and privately owned firms had accumulated
2010 July
            6.7 million tons of soybeans. As in the case of maize, state reserves of soybean were introduced to stabilize domestic prices.

            EUROPEAN UNION - environmental standards for biofuel: The Commission remains committed to enforce, from December
            2010 onward, strict standards that will apply equally to EU-produced and imported biofuels. To participate in public biofuel
            support programmes, evidence of sustainable sourcing, production and use is expected from the industry. The sustainability criteria
            centre on (i) the lifecycle GHG emissions of biofuels and (ii) the type of land use underlying biofuel production. Voluntary
            certification schemes developed by the industry are welcome and will be independently assessed. The official stance have been well
2010 July
            received by the industry, whereas environmental and social interest groups have called for further clarification regarding the
            measurement of indirect land use change effects, the definition of highly biodiverse grassland and the methodology for identifying
            degraded land. With regard to palm oil, EU officials pointed out that the new directives will in no way affect crude palm oil exports
            to the EU market for traditional consumer products like food, cosmetics and detergents. With regard to palm oil-based biofuels,
            however, all supplies - whether imported or domestically produced - will fall subject to the new requirements (if they are to qualify
            for public support). Consequently, suppliers will, interbudget includes provisions for GHG emission savings of at least 35% - as
            INDONESIA - biofuel subsidy: The country‟s 2011 alia, face the onus of proving continued support to biofuel production. Sales
            of biodiesel and bioethanol will be subsidized at a rate of Rp. 2000-2500 per litre whenever their price exceeds the market price for
2010 July
            mineral oil-based fuel. In the years 2009 and 2010, biofuel producers were compensated at a rate of, respectively, Rp. 1000 and Rp.
            2000 per litre. Currently marketed diesel contains 5% of palm oil-based biodiesel.
2010 July
            PAKISTAN - palm oil import duty: A reduction in the import tariff for crude palm oil from Rp. 9,000 per ton to Rp. 8,000 has
2010 July   been announced in the 2010/11 federal budget. Particularly Indonesia, Pakistan‟s main supplier of CPO, will benefit from the duty
            reduction.
            RUSSIAN FEDERATION - sunflower cooperation agreement: Benefiting from government mediation, the country‟s Grain
            Union and Vegetable Oil Producers Union have signed an agreement that aims to develop the national sunflowerseed market by
2010 July   improving the financial sustainability of seed production and marketing. The agreement sets general principles of cooperation
            between producers and processors. Inter alia, it creates opportunities for using seeds as collateral when taking out production loans
            and envisages a minimum farm gate price of 9000 Rubles per ton of sunflowerseed.
            RUSSIAN FEDERATION, BELARUS, KAZAKHSTAN - palm oil import duty: Reportedly, the three-country customs union
2010 July   decided to temporarily raise its tariff on packaged palm oil. A Euro 0.40 per kilo duty will apply to packages up to 1 kg and
            containers up to 20 tonnes. Bulk shipments will continue to be imported duty free.
            TANZANIA - edible oil production: Reportedly, in recent months, several of the country‟s edible oil factories were forced to
            suspend their operations because locally produced oil is not able to compete with imported products. Allegedly, domestic
2010 July
            production is burdened with heavy taxation whereas imported oils enter the country free of duties. Currently, well over half of the
            country‟s edible oil consumption is met by importation.
            UNITED STATES - biodiesel tax break: After gaining the approval of the Lower House earlier this year, renewal of the tax break
            still has to pass the Senate. The taxation level directly and significantly affects the competitiveness of domestic biodiesel
2010 July
            production. Hence, biodiesel sales and production have fallen markedly since the tax break‟s expiry in December last year. With
            renewal still pending, the recovery of domestic consumption to mandated levels may be compromised.
            UNITED STATES - rapeseed-based biodiesel: The government confirmed that the rapeseed diesel will be allowed to benefit
2010 July   from public biodiesel support programmes even though the fuel‟s evaluation by the Environmental Protection Agency has yet to be
            completed.
            Roundtable on Responsible Soy (RTRS): The RTRS, a world-wide initiative that groups stakeholders from across the soy
            commodity chain and includes environmental groups, is ready to introduce voluntary certification for sustainably sourced soy
            products. To qualify for the label, producers will need to fulfil specific principles and criteria related to environmental and social
            responsibility, good agricultural and business practices and legal compliance. The initiative aims at promoting responsible
2010 July   production irrespective of the underlying production model. Standards include prohibitions regarding the conversion of forests and
            of areas with high conservation value (such as rich savannahs) as well as regarding the use of the hazardous pesticides. Certification
            processes, compliance verification and traceability will be regulated next. Meanwhile, social interest groups have voiced concerns
            with regard to the dominance of GM varieties, climate implications of the crop‟s rapid expansion and its use as biofuel feedstock.

            Jatropha-based biodiesel: An Australian biodiesel refiner is reported to have started producing and marketing jatropha diesel on a
2010 July   commercial scale. The feedstock is collected across India and processed in Malaysia. Reportedly, the company is targeting a base
            cost of around USD 64 per barrel (or 40 cents per litre) of fuel landed in the United States.
              Consumer-oriented palm oil shortening: A newly commercialized palm oil shortening/hardening is meant to help food
              manufacturers and industrial bakeries to meet end-consumer demands for sustainably sourced and healthy products. Allegedly, the
2010 July
              shortening, which consists of a blend of palm and rapeseed oil, contains only palm oil certified as sustainable (by either RSPO or
              GreenPalm) and is characterized by a limited content of saturated fats.
              Glycerine-based biofuel: A renewable fuels provider is reported to have filed a patent on a technology that allows using glycerine
2010 July     as main feedstock in the formulation of a stable biofuel. Inter alia, glycerine is generated as a by-product when vegetable oils or
              animal fats are transformed into biodiesel via transesterification.
              Monitoring the fat balance in diets: According to private research supported by a consumer advocacy group, in the United States,
              since the introduction of compulsory trans fat labelling in 2006, the level of trans fats in selected food products and restaurant meals
2010 July
              has diminished without being accompanied by a rise in the level of saturated fats. The study suggests progress in efforts by the food
              chain to reformulate food products offering a healthier balance of fats.
              Accounting for biofuel GHG emissions: Reportedly, in the United States, a group of prominent scientists drew attention to the
              importance of proper accounting for GHG emissions that occur in the production and use of different forms of bioenergy, including
              biodiesel and bioethanol. Failure to do so could undermine other efforts to address climate change. The scientists cautioned that
2010 July
              ignoring the carbon impact of bioenergy could actually lead to increases in GHG emissions because some types of bioenergy may
              be more polluting than fossil fuels. The US administration was invited to consider the matter in all future formulation of bioenergy
              legislation.
              Low-carbon oil palm expansion: Reportedly, the governments of Indonesia and the United States are considering to enter into a
              comprehensive partnership to control the conversion of forest and peat land by diverting oil palm expansion in Indonesia toward
              degraded land, i.e. areas that were cleared of forest long ago and now contain low carbon stocks and low levels of biodiversity, but
2010 July
              are still suitable for oil palm cultivation. The effective and equitable implementation of such a strategy entails major challenges of a
              technical, legal, social and financial nature - which the proposed bilateral partnership would endeavour to address.

              Sustainable sourcing of palm oil: In pursuance of its goal to obtain 100 percent of the palm oil it uses form sustainable sources,
              global consumer goods company Nestlé decided to partner with non-profit organization The Forest Trust (TFT) . The performance
2010 July     of Nestlé‟s palm oil suppliers will be audited by TFT against a set of criteria. Supplier that do not meet the requirements but are
              committed to achieving sustainability will be provided with technical support. The project‟s objective is to establish fully
              responsible supply chains by identifying and addressing all major environmental and social issues.
              ARGENTINA - biodiesel blending mandate: The government announced the imminent issuance of a resolution that increases the
              mandatory biodiesel blending rate from 5% to 7%. Furthermore, the intention to lift the rate further to 10% by the end of this year
2010 August   was confirmed. The country is the world‟s leading exporter of soyoil - Argentina‟s primary feedstock for biodiesel. Expanding local
              demand for biodiesel may eventually reduce export availabilities. Reportedly, the measure is meant to provide support to domestic
              soyoil sales and reduce dependence on soyoil exports as well as to reduce outlays on fossil fuel imports.
              ARGENTINA/CHINA - soyoil trade: Reportedly, at a recent meeting of heads of state no agreement emerged regarding China‟s
2010 August
              import requirements, which brought Argentina‟s soya oil sales to the country to a standstill last April.
              BRAZIL - sustainable soy production: The country‟s private sector has launched Soja Plus , an environmental and social
              management initiative adapted to the Brazilian context that includes certification of sustainable soybean production. In an effort to
              contribute to the conservation of natural resources, the voluntary programme aims to promote environmentally and socially
2010 August   sustainable production. To obtain certification, producers need to comply with a list of criteria that foresee the observation of
              environmental and social laws and land title regulations, the use of best agricultural practices and adoption of socially and
              environmentally responsible production methods. Criteria compliance is to be verified through transparent and independent auditing
              procedures.
              CANADA - support to rapeseed sector: Reportedly, the federal government has allocated C$ 1.5 million to the Canola Council
              of Canada for activities aimed mainly at increasing international demand for rapeseed products. Improved market access is sought
2010 August
              especially in the United States, Mexico, India, Japan and China. Public funds shall be matched by an equal amount coming from
              rapeseed growers and the industry.
              EUROPEAN UNION - butter sales from intervention stocks: The sale of close to 12,000 tons of butter from intervention stores
              was reported. Last year‟s sharp fall in price had lead to intervention purchases amounting to 76,000 tons. Reportedly, 51,000 tons
2010 August
              of butter were already disposed of earlier this year. The decision to release stocks was taken against the backdrop of improving
              farmgate prices.
              EUROPEAN UNION - GMO traces in imported animal feed: The Commission signalled its readiness to ease the EU‟s stringent
              rules on the presence of unauthorized GMO traces in imported feed material. The current „zero tolerance‟ approach is supposed to
2010 August   be replaced later this year by a more workable threshold that addresses the difficulties of completely avoiding presence of GMO
              traces. In the autumn of last year, shipments of soymeal to the EU came to a standstill following the detection of GMO traces at EU
              ports.
              EUROPEAN UNION - application of GMO soybean patent: The European Court of Justice ruled that a patent is only valid up
              to the point where the GM trait is performing its patented function. This implies that once processed, i.e. after transformation into
              soyoil and meal, soybeans no longer enjoy patent protection. The case was referred to the Court after seed producer Monsanto
              claimed patent rights on EU imports of soymeal produced from Roundup Ready soybeans in Argentina, where the GM variety is
2010 August
              planted freely without patent protection. The court found extending seed patent protection to final products to be impractical as in
              such case an unspecified number of derivate products would come under the control of whoever had patented the DNA of a plant.
              The ruling ends a long-standing dispute, allowing importation and commercialization of Argentinean meal in the EU to continue
              without triggering payment of royalties.
              EUROPEAN UNION - Community GMO legislation: The EU Commission proposed to overhaul current EU legislation on
              GMO cultivation and marketing. First, legislation has been adopted that envisages the immediate relaxation of coexistence
              guidelines governing side-by-side cultivation of GM and conventional crops. Member states will be allowed to take more stringent
              measures to keep GMO cultivation isolated from other cultures, possibly outlawing biotech crops altogether in a given region or
2010 August   member state. Second, the following modification of community legislation on the authorization of GMOs is proposed: while
              science-based, EU-wide authorization procedures would remain in place, individual member states may opt for permanent
              moratoria on cultivation (of specific biotech varieties or GMO as a whole) purely on ethical grounds - rather than based on the
              assessment of adverse health or environmental effects. While this would authorize individual states to prevent GMO crops from
              being cultivated, they would not be allowed to ban the importation and marketing of EU-approved material.
              EUROPEAN UNION - seed production competition issues: Reportedly, the European Commission decided to carry out a
              market investigation with regard to the planned merger of Monsanto ‟s and Syngenta ‟s sunflowerseed businesses. In view of the
2010 August
              proposed consolidation, the Commission wants to ensure that effective competition is preserved, so as to maintain innovation and
              prevent prices from rising.
              INDIA - soya oil futures contract: Allegedly as the first regional exchange in the country, Rajkot Commodity Exchange (RCX) in
2010 August   Gujarat State has added a contract for refined soyoil to its portfolio, after gaining approval to do so last March. Gujarat is the
              country‟s main soyoil importing state.
              INDONESIA - palm oil export tax: In response to the past fall in global palm oil prices, the government decided to lower, in
2010 August
              August, the ad valorem export tax from 4.5 % (in place since April this year) to 3 %.
              INDONESIA/NORWAY - joint initiative to halt forest conversion: The Indonesian government announced a 2-year
              moratorium (starting next year) on concessions for clearing forest and peatland - an important source of GHG emission and thus
              global warming. Past forest/peatland conversions into plantations and for industrial use constitute a major source of livelihood in
              the country. The decision to stop new concessions is part of a deal reached with Norway, which agreed to assist the country in
              preserving its forests. Funding for sustainable forestry programmes (worth up to USD 1 billion) shall be released from 2014,
2010 August
              contingent on progress made in deforestation/emission reduction. Meanwhile support would be provided to set up appropriate
              control mechanisms, run pilot projects and to work on the issue of conflicting claims on land. Conditions for cooperation and
              performance-based criteria still need to be negotiated. Logging concessions already granted to companies shall be honoured,
              although revocation of existing licenses might be considered in particular cases, with financial compensation or land swaps granted
              to affected companies. Government officials pointed out that sufficient non-forest, degraded but still suitable land was available to
              NEW ZEALAND - growth of the vitally important so far granted on biodiesel blends of up to 20% (42.5 cents per on
              accommodate furtherbiodiesel subsidy: The subsidy plantation industries. In this regard, reaching general consensus litre) has been
              extended to blends up to and including 100%. The measure is meant to further stimulate consumption of domestically produced
2010 August
              biodiesel. Meanwhile, private sources estimate that uptake will still fall short of the scheme‟s overall funding capacity and that
              imports would continue to dominate domestic consumption.
                 RUSSIAN FEDERATION - rapeseed export duty: Reportedly, the Russian Grain Union is proposing to the Government to lift
                 export duties on rapeseed. Should this happen, rapeseed production for export could receive a strong boost - considering the amount
                 of land reported to be available in the country for expanding rapeseed cultivation. Introduced in 2001 to encourage domestic
2010 August
                 crushing of seeds, in 2007 the ad valorem tariff was lowered from 20 to 15 percent. Allegedly, suspension of the duty is proposed
                 because the domestic crushing industry has exhausted its growth potential and in order to enable the industry to benefit from
                 growing demand by the EU‟s biodiesel industry.
                 TURKEY - sunseed & oil importation: Reportedly, 2010/11 import quotas for sunflower seed and oil will remain unchanged
                 from their 2009/10 level, i.e. 650,000 mt for seed and 260,000 mt tons for crude oil. However, the import tariff for seeds will be
2010 August
                 lowered from currently 5% to 0% and from 17% to 15% for crude oil, effective January 2011. To support domestic production,
                 only crushers who process domestic seed will be allowed to benefit from the lower duties.
                 UNITED STATES - rapeseed oil biodiesel: The Environmental Protection Agency, which oversees implementation of renewable
                 fuel legislation and related support programmes, informed that based on comprehensive life cycle analyses the rapeseed oil biodiesel
                 pathway creates a 50 percent reduction in GHG emissions compared to the mineral oil baseline. The fuel is thus ready to join soyoil-
2010 August
                 based biodiesel on the list of fuels meeting RFS-2 requirements for biomass-based diesel. Analysis of other vegetable oil-based
                 fuels, including palm oil biodiesel, is yet to be completed. Regarding overall demand for biodiesel, the agency informed that, in
                 2011, 800 million gallons will be required to comply with current legislation.
                 Soy applications in automotive industry: After using soy-based foams in car seats and other automotive applications, motor
                 company Ford reported to have engineered a patent-pending formula to use renewable soy products to improve rubber parts in cars
2010 August
                 while at the same time reducing the environmental footprint. Allegedly, soy oil and soy fillers can replace up to 26% of the
                 petroleum-based content in rubber parts. Research has been supported by the United Soybean Board of the United States.
                 Sustainable sourcing of palm oil: Global food producer and trader Cargill decided to partner with the World Wildlife Fund to
                 undertake an assessment of its palm oil sources in Indonesia. The objective is to measure progress amongst suppliers in the
                 implementation of the principles established by RSPO thereby encouraging the adoption of socially responsible and
2010 August
                 environmentally sustainable production methods. The assessment shall be used to identify gaps vis-à-vis the RSPO standards and
                 suppliers will receive specific assistance to improve their production practices. Reportedly, Cargill aims at buying 60% of its overall
                 palm oil from certified sources by the end of 2010.
                 ARGENTINA - grain export taxes: The government‟s special legislative power to set export taxes expired last month.
                 Consequently, the authority to fix export duties on soybeans and other grains has reverted back to Congress, which could be open to
                 the idea of adjusting the taxes downward. Most observers concur that the debate on whether or not and by how much export taxes
2010 September   should be cut is going to be a long, complex and open-ended one. Reportedly, one proposal that is being discussed in the Lower
                 House foresees an immediate reduction in the soybean tax from 35 to 30 percent, and its gradual further lowering to 10 percent by
                 2015. The Upper House, however, seems likely to oppose such drastic cuts, because part of the tax revenue is channelled to
                 provinces and provincial lawmakers are strongly represented in the Senate.
                 ARGENTINA - use of herbicides: Reportedly, proposals to limit the use of herbicides (notably glyphosate, which is extensively
                 used in the widespread cultivation of GM soybeans) are under consideration in two of the country‟s principal soy-producing states.
2010 September   The initiatives are driven by concerns about the environmental sustainability of current production practices. Proposed legislation
                 would prohibit spraying around urban areas and envisages a complete phasing-out of the herbicide over the next decade.

                 CANADA – measuring environmental footprint of biofuels: A study commissioned by Environment Canada found gaps in the
                 way biofuel plants measure emissions of GHG and other pollutants. Differences in the way biofuel facilities gather and report data
2010 September   make it difficult to accurately determine the environmental footprint of biofuels. According to the report, more work is needed to
                 improve baseline data to measure pollution from biofuels plants. This could include getting the industry to agree to common
                 standards for gathering and reporting pollution data.
                 CANADA - assistance to farmers: Reportedly, special aid will be provided by the government to farmers affected by recent
                 adverse weather conditions, especially in the provinces of Alberta, Manitoba and Saskatchewan. The programmes are to be funded
2010 September
                 jointly by the provincial and federal governments. Wheat, rapeseed and barley are expected to benefit from the assistance.

                 EUROPEAN UNION - investigation on trade in biodiesel: Reportedly, the European Commission decided to investigate
                 whether (i) biodiesel produced in the United States is being shipped into the EU via third countries, and (ii) whether US exporters
2010 September   shifted to blends containing less than 20 percent biodiesel so as to circumvent the bloc‟s anti-dumping and countervailing duties
                 (imposed on US imports in March 2009). The decision follows a confidential complaint lodged by the European Biodiesel Board.
                 Investigations are expected to take about nine months.
                 EUROPEAN UNION - biofuel consumption targets: Unofficial sources estimate that the EU is falling short of its target for
                 biofuel use in the transportation sector. According to EU directives, by end of 2010, biofuels were supposed to account for 5.57%
                 of total transport fuel sales. Instead of the corresponding 18 million tons, EU biofuel sales have been estimated to reach only 15
2010 September   million tons of oil equivalent this year. Year-on-year rise in biofuel consumption is estimated at around 20% in 2010, which
                 compares to considerably higher rates in previous years. As to the type of biofuel used, consumption of biodiesel, which accounts
                 for roughly 80% of biofuel transport fuels (expressed in energy content), is reported to be growing less strongly than bioethanol and
                 biogas use.
                 INDIA - vegetable oil import taxation: In response to rumours that the government might raise import duties in an effort to
                 support domestic farmers, official sources stated there was no intention to reintroduce or raise tariffs since such measure could
2010 September
                 increase the inflationary effect of growing global vegetable oil prices on the domestic market. As in recent years, the government‟s
                 main preoccupation concerns the effect of rising domestic oil prices on consumers.
                 INDONESIA - palm oil export tax: Following the recent rise in the global price of palm oil, the government decided to lift, in
2010 September   September, the ad-valorem export tax from 3 to 6 percent - the highest level since November 2008. The export tax is adjusted on a
                 monthly basis with a view to ensure adequate domestic supplies, thereby preventing surges in domestic prices.
                 LIBERIA - land concession for oil palm development: Reportedly, a concession was signed between the government and an
2010 September   Indonesian company to set up a 200 000 ha oil palm plantation. In addition to generating local employment, the project comprises
                 the development of smallholder production with access to dedicated purchasing centres and extension services.
                 PAKISTAN – government support to flood affected areas: Oilseed production: The government decided to raise the official
                 purchase price for sunflower and rapeseed from Rs 1600 to Rs 1800 per 40 kilo in flood-affected areas, effective September.
                 Furthermore, concerned farmers will be provided with subsidized credit to purchase seed and other inputs, and additional centres
2010 September   will be set up to guarantee public and private crop procurement. Increased support to the two oilcrops is also meant to respond to
                 the expected drop in cottonseed production, following extensive flood damage. Oil manufacturing: Ghee and cooking oil
                 manufacturing units in flood-affected areas have been granted permission to import required raw material free of duties.

                 SRI LANKA - special assistance to coconut in Northern Province: The Coconut Development Board is planning to provide
2010 September
                 special relief measures to farmers engaged in coconut cultivation in the country‟s war-stricken Northern Province.
                 THAILAND - soya import tariff: Reportedly, the government is planning to suspend the 2% ad-volorem tariff starting January
                 next year. The measure would aim at curbing the rise in feed costs, thereby allowing to check overall food price inflation and costs
2010 September
                 of living increase. In the past, soy imports were subject to quantitative restrictions. Purchases where then freed in 2007, when an
                 initial duty of 4% was introduced. Industry obligations to first absorb domestic production will remain in place.
                 THAILAND - biodiesel blending rates: Biodiesel consumption seems set to increase further in coming years. Reportedly,
                 voluntary blending has been replaced earlier this year by mandatory B3 fuel nationwide, and mandatory B5 is scheduled for
2010 September   January 2011. Furthermore, the government seems committed to develop B10, which is currently being engine-tested. The B10
                 target requires further expansion in the domestic oil palm plantation area so as to avoid competition between food and fuel uses and
                 to stay away from the need to import biofuel feedstock.
                 UNITED STATES - rapeseed meal imports: The Food and Drug Administration has lifted restrictions on rapeseed meal imports
                 from selected Canadian suppliers. The restrictions were introduced in December last year after detection of harmful salmonella
2010 September
                 bacteria in shipments. Reportedly, in August, two plants operated by Bunge have been freed from special import inspection at
                 border.
                 Rise in palm oil production costs: Triggered by Indonesia‟s prospective planting moratorium (see August 2010 MPPU issue),
                 concern about future, gradual rises in production costs is reported to be spreading among palm oil producers in Asia. The prospect
                 of rising limitations on future expansion in plantations - based on increasingly stringent environmental regulations - could have
2010 September
                 important repercussions across the sector, such as (i) rises in the cost of land, (ii) consolidation among companies to increase their
                 land base, (iii) increasing investments outside of Indonesia and Malaysia (e.g. in PNG and West/Central African states), and (iv)
                 increased efforts to raise productivity levels.
                 Reformulation of fat profile in food products: Reportedly, confectionary manufacturer Mars is reformulating chocolate products
                 sold in France and the UK to reduce the content of saturated fats by 15-20 percent. Reformulation involves shifts in the type of
2010 September
                 vegetable oils employed. The company informed that by changing the fat profile it is aiming at improving the nutritional
                 composition of its products.
                 Global framework for palm oil development: The World Bank and the International Finance Corporation have presented a
                 draft framework for future engagement in the palm oil sector. In the framework, priority areas and options for action are outlined.
2010 September   The four thematic areas identified as being crucial are: (i) policy and regulatory environment, (ii) mobilization of sustainable private
                 sector investment, (iii) benefit sharing with smallholders and communities, and (iv) sustainability codes of practice.

                 Vegetable oil-based aviation biofuel: - Camelina seed: A member of the mustard family, camelina produces an oil that seems to
                 show promise as an aviation fuel, the specifications of which are distinct from biodiesel used for land-based vehicles. Extensive
                 trials are being carried out, especially in North America and Europe, by both, military and civil aviation. The sector‟s potential
                 demand is reported to be high. In the United States, for instance, half of the continental military jet fuel requirement is mandated to
2010 September   be met by alternative fuels by 2016. The interest of commercial airlines for renewable fuels that can be sustainably produced is also
                 rising. As an aviation fuel, camelina oil can be blended with conventional fuel at inclusion rates as high as 50%. With final
                 approval and certification of the fuel expected next year, private sources anticipate camelina jetfuel production to rise to over 3
                 million tons by 2025. Allegedly, camelina can be grown in dry regions, not best suited for food crop production. To date the crop is
                 cultivated primarily in the United States and Canada, mainly in rotation with wheat and using conventional equipment. Yield
                 improvements via varietal selection still-present major challenges. Camelina is expected to remain a regionally the production of
                 Vegetable oil-based aviation biofuel: Mexico: Reportedly, the country aims at becoming a major player in based feedstock and
                 renewable jet fuels. Public-private partnerships started exploring non-edible plants and vegetable oils that could be used as
2010 September   feedstock for renewable aviation fuel. Production would be for both the domestic market and exportation to the United States. Non-
                 edible plants such as jatropha and salicornia would be planted on land unsuitable for food production. Currently, the country seems
                 to lack the required refineries and part of the technology involved.
                 Vegetable oil-based aviation biofuel: - Thailand: Reportedly, the country is planning to develop jet biofuels with the objective
                 to meet demand from 2012, when European aviation regulations calling for the introduction of renewable fuels in airplanes are
                 expected to come into effect. The goal is to become South-East Asia‟s hub for the supply of green aviation fuel. Although palm oil
2010 September
                 is considered a suitable feedstock, areas for expanding oil palm seem to be limited and competing uses for food purposes and as fuel
                 for land-based transport pose problems. Other crops, such as sweet sorghum or algae seem to offer better potential.

                 Fully segregated sustainable palm oil: Cargill has signed an agreement with Unilever Europe to supply fully segregated,
                 sustainable palm oil, certified by RSPO. The oil will be physically segregated at every step of the supply chain. Cargill is in a
2010 September
                 position to offer segregated, refined oil after having received RSPO certification on selected plantations as well as refineries run by
                 the company.
                 RSPO certified smallholder palm oil: Certification of the first smallholder oil palm scheme has been reported from Indonesia.
                 Some 8 800 smallholders organized in 17 cooperatives have been certified to comply with the RSPO „Smallholder Principles and
2010 September   Criteria‟ for sustainable production. The smallholder scheme in question is linked to a large, already certified plantation and mill
                 operated by Cargill . Certification is expected to lead to rising incomes for producers as demand for certified palm oil is anticipated
                 to continue expanding in coming years.
                 Palm oil sourcing policies: Private sources reported that a number of major, global food companies decided to stop purchasing
                 palm oil from a particular supplier in Indonesia, based on a recently published audit of the producer‟s cultivation practices.
2010 September
                 Reportedly, in the audit, concerns were raised about the sustainability of the company‟s production practices, the possible breach of
                 national laws, and the environmental impact of past deforestation and peatland conversion.
                 BELARUS - export restrictions for rapeseed: After the introduction of a variable export duty for rapeseed in June 2010, in
                 September, rapeseed oil fell subject to a six-month export ban. Reportedly, an extension of the ban to rapeseed is also being
2010 October
                 considered. The measure has been justified by this year‟s shortfall in rapeseed production following adverse weather conditions.
                 The shortfall comes in a period of rising demand caused, inter alia, by growing production of rapeseed-based biodiesel.
                 CANADA - support to biodiesel production: As part of the Ecoenergy for Biofuels programme, the government is set to provide
                 support to a private producer of biodiesel and glycerol who uses animal fat and waste cooking oil as feedstock. The end-product
2010 October
                 shall be sold on the domestic market as well as exported to the United States. The investment is expected to help reducing GHG
                 emissions while promoting a sustainable environment.
                 CHINA soybean - public production support: The soybean industry in Heilongjiang expects the government to introduce
                 additional measures in support of soy farmers in the coming months. In the country‟s main soybean province, production growth
                 has come to a standstill in recent years in spite of several government measures supporting the sector, notably public purchasing and
2010 October
                 storing schemes and import restrictions. Despite these efforts, the region‟s crushing capacity utilization rate is reported to have
                 dropped to 20-30%. The steady expansion of imports of competitively priced soybeans in coastal provinces explains most of this
                 development.
                 CHINA soybean - oversees investment: Reportedly, Chinese investors and public authorities in Argentina‟s southern province
2010 October
                 Rio Negro are conducting negotiations regarding the development of 200,000 ha of soybeans.
                 LIBERIA - oil palm development: A major public-private partnership has been launched to develop the oil palm industry.
2010 October     Participating parties are committed to environmentally and socially sustainable methods of production and to work with
                 smallholders. The investment is seen as a central growth pillar in rebuilding the country‟s economy and reducing poverty.
                 MALAYSIA - biodiesel production: Reportedly, the government‟s recent decision to postpone by one year the introduction of B5
                 (i.e. mandatory blending of transport diesel with 5% of palm oil-based fuel) caused domestic production of biodiesel to virtually
                 stop. At the current price level for crude palm oil and in the absence of subsidies, margins are reported to be insufficient to justify
2010 October
                 biodiesel production. Opportunities on the export market are also very limited due to (i) increased wariness of some buyers to
                 purchase palm oil-based diesel based on environmental considerations, and (ii) the availability of competitively priced biodiesel
                 from other countries.
                 RUSSIAN FEDERATION - export restrictions for sunflower: According to press reports, the government is giving
                 consideration to the introduction of restrictions on sunflowerseed and oil exports in response to the prospective fall in domestic
2010 October
                 production following recent adverse weather conditions. By limiting the outflow of oilseeds, the government would aim at
                 preventing local market prices from rising. The restrictions considered are a temporary export ban or the introduction of duties.
                UNITED STATES - soybean relief payments: USDA announced that it is going to provide assistance to producers of soybeans
                and other crops who suffered quality and yield losses in 2009 due to high moisture conditions. Reportedly, soybean farmers that
2010 October
                experience at least five percent loss will be eligible for a relief payment of USD 15.62 per acre planted or intended for planting in
                the 2009 season.
                Jatropha - genome sequencing: Reportedly, a group of scientists has succeeded in sequencing the genome of jatropha curcas , a
                biofuel crop that has attracted interest in many countries. The non-edible crop grows on marginal land with minimum inputs,
                supposedly not competing with food production. However, under the said conditions, yields tend to be low and erratic, also because
2010 October
                to date seeding material was often derived from wild populations. The identification of the plant‟s genetic sequence is expected to
                speed up the development of proper varieties with high yield potential, better drought tolerance and other desirable traits.

                Soybean high in oleic acid: Reportedly, researchers in the United States have developed - through traditional breeding techniques -
                a soybean whose content of oleic acid is 80% as opposed to 20% in conventional material. The level of monounsaturated oleic acid
                has been increased at the expense of saturated fats, supposedly creating a healthier oil. Thanks to its specific fatty acid composition,
2010 October
                when used in the food industry, the oil remains stable at high temperatures and does not require hydrogenation - a process that
                creates trans fats, which were shown to be unhealthy. In order to launch the new variety at commercial level about three years will
                be required.
                Sustainable palm oil: Reportedly, United States food manufacturer General Mills decided to stop buying palm oil from companies
2010 October    suspected of using environmentally harmful practices. The food company is committed to procure, by 2015, all of its palm oil from
                responsible and sustainable sources. Global Mills is following the footsteps of other global food companies.
                AFRICA - oil palm development, Ghana: Reportedly, the government is developing an oil palm master plan to meet local
                demand for vegetable oil and improve the country‟s competitiveness as a regional exporter. Areas covered in the plan include access
2010 December
                to finance, land-use policies, technology transfer, transportation infrastructure, pricing mechanisms, product certification and
                marketing.
                AFRICA - oil palm development, Uganda: A large national oil palm development project launched in 1998 is ready to enter its
                second phase. Under the project, smallholder oilcrop production (in particular oil palm) is raised and smallholders are directly
                linked with processors. Plantations are developed according to modern environmental standards. The public-private partnership
2010 December
                builds on a loan provided by IFAD as well as local, private capital and bilateral grant money. Reportedly, the project has lead to a
                significant increase in oil production from domestic sources and marked improvements in average per caput consumption, while
                reducing the country‟s dependence on imported oils.
                BRAZIL - oil palm expansion: Reportedly, the government decided to introduce a set of rules that guarantees sustainable forms of
                oil palm expansion and prevents further deforestation. Oil palm plantations may only be established on degraded land, which would
2010 December   allow rehabilitation of previously deforested areas. All oil palm growers will be required to register for regular inspection. Oil palm
                expansion will also be monitored via satellite images, and companies buying palm oil from areas other than those earmarked for oil
                palm development risk loosing their environment licenses.
                CHINA - measures to stem food price rise: sale of state reserves. Concerned about rising inflation rates and with domestic
                vegetable oil prices recently reaching two-year highs, the government has taken the following measure: State operated agencies have
                been instructed to sell - via open bidding - their reserves of rapeseed oil, soy oil and soybeans with a view to increase domestic
2010 December
                supplies and thereby stabilize prices. Built over the last 2-3 years for market stabilization purposes, these reserves need to be sold to
                avoid quality deterioration. Furthermore, room needs to be freed for purchases of new-crop oilseeds and oils that have been ordered
                by the government.
                CHINA - measures to stem food price rise: futures markets. Concerned about rising inflation rates and with domestic vegetable
                oil prices recently reaching two-year highs, the government has taken the following measure: Reportedly, the government has asked
2010 December
                the country‟s futures exchanges to raise margin requirements applied to trade in selected commodities, including soybeans, soya
                meal, soya oil and palm oil. The measure aims at deterring speculation on commodity markets.
                CHINA - soyoil imports: Purchases of soybean oil from Argentina - which had come to halt last April when a set of strict quality
                requirements was introduced - have resumed in October thanks to the suspension of the new rules. Reportedly, only government
2010 December
                controlled companies have been granted permission to import. Market observers have linked the change in policies to the country‟s
                difficulties to secure sufficient soyoil imports.
                CHINA - soybean state purchases: Reportedly, the government is ready to buy soybeans from the last crop to rebuild state
2010 December
                reserves. At Yuan 3800 per ton of 3rd grade beans (Yuan 3844 for 2nd grade and Yuan 3880 for first grade), purchase prices would
                be Yuan 60 higher than last season. For wheat, the increase in the state purchase price is reported to be significantly higher, while
                that for maize has yet to be announced.
                INDIA - new commodity exchange: Ahmedabad Commodity Exchange has started to operate as the country‟s fifth national
2010 December   commodity bourse, launching futures trading in five agricultural items, comprising soybean, soybean oil, mustard seed and castor
                seed.
                INDIA - certified palm oil: In a bid to stimulate consumption of certified sustainable palm oil, the country‟s vegetable oil industry
2010 December   proposed to the government to apply a discounted duty on future imports of „green‟ palm oil. The industry expects that pressure on
                big consumers to move toward environmentally friendly purchasing policies will rise in coming years.
                INDIA - support price: Reportedly, the 2010/11 minimum support or procurement price for rapeseed has been raised to Rp 18,500
2010 December
                per tonne, a 1% increase compared to 2009/10.
                INDIA - edible oil trade policy: With this seasons‟ improvement in domestic oilseed output and generally easing food prices,
                producers are asking that the duty exemption granted for imports of unrefined vegetable oil be discontinued. While considering the
2010 December
                request, the government has informed that the exemption would remain in place until early 2011. Furthermore, the government
                decided to extend the ban on bulk edible oil exports for another year, until September 2011.
                INDONESIA - palm oil export tax: monthly revision. Since 2007, the tax is adjusted on a monthly basis with a view to ensure
                adequate domestic supplies and prevent high volatility and hikes in domestic prices. Following uninterrupted growth in
                international palm oil prices, in December 2010, the ad-valorem export tax on crude palm oil will be raised for the fourth
                consecutive month. The rates applied in October, November and December are, respectively, 7.5%, 10% and 15%. A 15% rate had
2010 December
                not been applied since August 2008. According to private sources, local traders are concerned that the high tax rates will reduce the
                competitiveness of the country‟s exports compared to those of the main competitor, Malaysia. Higher tax rates also imply a bigger
                gap between the duties applied to palm oil and palm-oil based biodiesel (palm methyl ester). With the export duty on biodiesel kept
                fix at 2%, companies could step up export-oriented biodiesel production.
                INDONESIA - palm oil export tax: taxation system review. Reportedly, a government official stated that the current taxation
                system will be up for review because - although helpful in reducing fluctuations in domestic supplies and prices - the system has
2010 December
                proven ineffective in spurring the downstream palm oil industry, i.e. did not help raising exports of higher-value refined oil as
                opposed to crude oil.
                INDONESIA - palm oil certification: The government announced that, starting in January 2011, national certification of
                sustainable production (see news item in May 2010 MPPU) will become mandatory for all plantation firms and smallholders
2010 December   cultivating oil palm. Details on certification methods and procedures as well as compliance control are yet to be issued. Indonesia‟s
                industry seems to welcome national certification as opposed to RSPO-controlled certification, noting that the latter has been
                progressing slowly.
                JAPAN - voluntary trans fat labelling: Reportedly, the government plans to move to voluntary disclosure of levels of trans fatty
2010 December   acids in food products so as to reduce the risk of cardiovascular diseases. Mandatory labelling may be considered in the future.

                KAZAKHSTAN - export ban: Reportedly, in an effort to secure domestic supplies of oils and fats, the government has banned the
2010 December
                export of soybeans, sunseed, cottonseed, soyoil, sunoil, rapeoil and linseed oil for 6 month starting mid October.
                MALAYSIA - oil palm replanting: Concerned about slow output growth and stagnating yield levels, the government has
                announced a new oil palm replanting scheme for 2011. The state-funded programme shall be implemented over 2-3 years and will
2010 December
                involve some 365,000 hectares of palms older than 25 years. The previous, industry-funded scheme (which was introduced in 2008
                in response to weak palm oil prices and involved 200,000 hectares) is reported to have been almost completed.
                MALAYSIA - support to biodiesel: blending incentives. The Malaysian Palm Oil Board was reported to have allocated funds to
2010 December   five major petrol companies for investment in infrastructure for biodiesel blending. According to official sources, mandatory
                blending at B5 level - originally planned for January 2010 - is now set to come into effect in June 2011.
                MALAYSIA - support to biodiesel: petro-diesel subsidy. Reportedly, the government may consider cutting, from next year,
                subsidies traditionally applied to sales of conventional diesel. The measure would end an advantage currently enjoyed by petro-
2010 December   diesel when compared to palm-based biodiesel. While mandatory biofuel blending is set to commence in soon, the industry is
                complaining that at the current, high level of palm oil prices and without public support the production and marketing of biodiesel
                is not economically viable.
                MALAYSIA/INDIA - free trade pact: A bilateral trade pact set to come into effect next year will likely include, inter alia,
2010 December   concessions on Malaysian palm oil exports to India - which remained excluded from the India-ASEAN free trade agreement signed
                last year.
                PAKISTAN - flood-related production incentives: sunflowerseed. Reportedly, the government has been charged with the
                formulation of a comprehensive edible oil policy that would help farmers to recover from the recent floods as well as put and end to
2010 December   the country‟s dependence on imported oils. A package of incentives, including interest free loans, is to be prepared to encourage
                farmers to grow sunflowerseed for local oil production. Sunflowerseed has the advantage of being early maturing, low in irrigation
                water needs and drought resistant.
                PAKISTAN - flood-related production incentives: rapeseed. The State Bank of Pakistan announced that it is ready to offer
2010 December
                concessional loans to farmers sowing rapeseed in flood affected areas.
                SYRIA/VENEZUELA - joint olive oil venture: Backed by their national governments, private parties in the two countries are set
                to form a joint venture for olive oil production and marketing. Olive oil produced in Syria is expected to be exported to Venezuela
2010 December
                under preferential conditions. The project is part of new efforts to increase economic integration between the two countries.

                SRI LANKA - vegetable oil import duties: Concerned about recent surges in retail prices for edible oil and the resulting hardship
                for consumers, the government decided to reduce the taxes applied on palm and coconut oil imports. Originally introduced to
2010 December
                encourage domestic coconut production, the duties will now be lowered from 60 to 15 Rp per kg of coconut oil, and from 50 to 10
                Rp per kg of palm oil.
                THAILAND - soymeal import duty: Reportedly, the Government decided to extend the 2% import duty on soyameal for another
2010 December   year. The duty had been lowered in January 2009 (from previously 4%) with a view to contain increases in feed costs. Industry
                requests to abolish the duty altogether have been rejected so as not to discourage local soybean production.
                THAILAND - biodiesel mandate: Reportedly, the shift from mandatory use of B3 to B5 will be delayed from mid to late January
2010 December
                2011, as flooding has adversely affected local palm oil production.
                THAILAND - palm oil consumer price: With a view not to add burden to flood affected people, the government-brokered,
2010 December   voluntary price ceiling for palm oil will remain unchanged at Baht 38 per litre - in spite of requests by oil refiners to be allowed to
                raise retail prices (following rises in production cost due to record high palm fruit values).
                UNITED STATES - new olive oil standards: The USDA has launched new voluntary standards for olive oils grown in and
                imported into the US. The objective is to ensure that labelling of all olive oils is backed by detailed, scientifically verifiable
2010 December   guidelines as well as tests conducted by panels of qualified tasters. To be classified as „extra virgin‟, oils must, inter alia, be free of
                defects and contain no more than 0.8% of free oleic acid, which echoes the guidelines issued by the International Olive Oil Council.

                Improved waste oil-to-biodiesel conversion: A group of USA researchers reported to have simplified the conversion of used
2010 December   vegetable oil into biodiesel. The new conversion process is claimed to be environmentally benign and considerably faster than the
                conventional method. The new technology‟s viability at industrial scale still has to be proven.
                Jatropha developments: hybrid seed material. A US company has patented a technology to produce jatropha hybrid seed at
2010 December   large scale. In addition to resulting in greater yield, uniformity and vigour, the hybrid material is said to permit marked reductions in
                handling and deployment costs for jatropha plantations.
                Jatropha developments: business venture. Reportedly, global oilseed processing company Bunge has joined forces with
                specialized bioenergy and refining firms with the aim to develop the jatropha value chain through the introduction of advanced
2010 December
                technologies. The joint venture set out to prove the economic viability and environmental sustainability of jatropha as energy
                source, thus setting the scene for large-scale deployment of jatropha plantations globally.
                Certified sustainable palm oil: global supply and demand situation. Certification of sustainable palm oil started two years ago.
                Currently, certified oil reaches the market via three RSPO-approved trading systems: the full segregation method, mass balance
                calculation, or a book & claim mechanism. RSPO estimates current, actual demand for certified palm oil at 1.4 million tonnes per
                year - while annual production capacity is said to have reached 3 million tonnes. Leading international vegetable oil refining
                companies are estimating that annual global production of sustainable certified palm oil will need to rise to 15 million tons by 2015:
2010 December   this is because - feeling the pressure form environmental and social interest groups - more and more key buyers (such as Unilever or
                Nestlé) are committed to gradually move away from non-certified palm oil. However, current annual expansion is estimated at only
                1.5 million tonnes globally, meaning that production could fall short of future demand. This view is supported by the fact that many
                oil palm producers continue to resist moving towards certification, because of costs involved and because premiums offered by the
                market (for certified product) are small. Reportedly, these premiums have fallen to USD 3-5 per tonne, compared to levels as high
                as USD 50 only two years ago. The steep drop in premiums occurred when supply of certified palm oil picked up. Overall, future
                growth of sustainable palm oil: sourcing policies. According to British press, The even warn of possibleretail company for soap
                Certified the market for certified palm remains difficult to predict. Some observers Body Shop (a major excesses of supply over
                and cosmetics) decided to stop buying palm oil from a supplier reported to be producing under socially unsustainable conditions in
2010 December
                Colombia. Apparently, the supplier in question used to satisfy up to 90% of the retail company‟s palm oil needs.

                Certified sustainable palm oil: trademark. RSPO has launched a trademark/logo for free use by product manufacturers and retail
                companies when packaging items that use certified sustainable palm ingredients. The mark is meant to reassure consumers that
2010 December
                products they buy contribute to sustainable palm cultivation practices. If widely adopted, the measure is expected to induce more
                companies to commit using only certified palm oil.
                Biodiesel South-South cooperation: Colombia continues to offer its technical know-how in biodiesel production to countries in
                Central America. After participating in the construction of biodiesel plants in El Salvador and Honduras, Colombia‟s agricultural
2010 December
                research institute CORPOICA is now reported to have started cooperation with Mexico, where a plant using jatropha and palm oil
                will be set up with public funding.
                ALGERIA - measures to lower cooking oil prices: Alarmed by a sharp rise in consumer prices, the government is determined to
2011 January    reduce taxes and import tariffs on selected staple foods, including cooking oil. Reportedly, the envisaged measures would reduce
                cooking oil retail prices by 40 percent.
               BANGLADESH - fix soyoil retail price: In the wake of rising domestic prices for edible oils (resulting from higher prices of
               imported raw material), the government obtained the processors‟ agreement to keep retail prices for soybean oil below a set level in
2011 January
               major cities. The commitment is believed to be of a temporary nature and new negotiations may be required should international
               prices continue to rise.
               CHINA - measures to stem food price rise: temporary retail price stop. Government efforts to curb inflation in food prices,
               including for vegetable oils, are continuing. Reportedly, the government advised major vegetable oil retailers to refrain - irrespective
2011 January
               of rising prices of (imported) raw materials - from raising retail prices until March 2011. Similar measures were last adopted in
               2008, when affected companies were compensated via subsidies.
               CHINA - measures to stem food price rise: sales from reserves. Sales of soybeans and of edible oils from public reserves were
2011 January
               reported to continue at both central and regional level.
               CHINA - biodiesel tax credit: Biodiesel derived from waste animal fats or vegetable oils has been exempted from paying
               consumption taxes. The exemption applies retroactively from January 2009 and is estimated to amount to around Yuan 900 per ton.
2011 January
               The measure is part of government efforts to improve competitiveness in the bioenergy sector. Reportedly, national biodiesel use is
               targeted at 2 million tons in 2020.
               INDIA - vegetable oil import duties: According to a senior ministry official the government is not planning to change its current
               import duty structure for vegetable oils as this would directly lead to higher domestic retail prices. Recently, local producers and
2011 January   manufacturers had renewed their calls for a reintroduction of duties on crude edible oils (which currently pay zero duty) so as to be
               able to better compete against imported products. The government‟s position needs to be seen against the background of
               pronounced rises in cooking oils retail prices and general food price inflation in recent weeks.
               INDIA - copra procurement price: The minimum support price for copra has been lifted by Rs 0.75 per kg for the 2011 season
2011 January   with a view to encourage investment and increase productivity in coconut cultivation. NAFED continues to be in charge of
               procurement operations. The new prices for milling and ball copra are, respectively Rs 45 250 and 47 750 per tonne.
               INDIA - oil palm development: Given the country‟s almost total dependence on palm oil imports, the federal government is
               looking into possibilities of developing domestic production. To date, the country‟s oil palm development programme has produced
               limited results, with no more than 178 000 ha covered by plantations as against a potential area estimated at 1.03 million ha.
2011 January   Reportedly, the federal government has urged traditional growing states to step up efforts and has decided to also explore expansion
               possibilities in other Eastern states. Furthermore, the Rs 15 000 per ha subsidy granted to producers might be increased to Rs 40
               000 and higher input subsidies are being considered. A special thrust is expected to be given to oil palm cultivation in the next five-
               year plan (2012-17).
               INDONESIA - palm oil export tax: Following the steady rise in international palm oil prices, the government decided to lift the
2011 January
               country‟s export tax further to 20% (effective 1st January) - the highest level since 18 months. The adjustment implies a
               considerable burden for export sales especially of processed palm oil, making shipments less profitable compared to those of
               competitors, notably Malaysia.
               PAKISTAN - sunflower support price: The government is planning to further raise the seed purchase price for 2010-11, bringing
2011 January   it from formerly Rs 1 800 per 40kg to Rs 2 000. The move is meant to stimulate domestic production thereby reducing dependence
               on vegetable oil imports. Apparently, crushing companies have agreed to pay farmers the higher price.
                PAKISTAN - poor household consumption subsidies: Reportedly, over the last two months, the subsidized distribution of
2011 January    cooking oil and ghee via special government outlets has been subject to successive price increases. The rise in prices is expected to
                adversely affect low-income consumers.
                PHILIPPINES - coconut industry roadmap: The Philippine Coconut Authority presented the Coconut Industry Roadmap 2011-
                2016, a six-year programme worth over Pesos 8 billion meant to raise the productivity of the sector. Proposed activities, which will
2011 January
                require joint private-public funding, comprise schemes for planting, replanting, fertilization, pest management and seed farm
                development.
                TANZANIA/BURUNDI - oil palm development: Palm oil production and processing is being promoted in the region to cater for
                the needs of local soap producers who at present heavily rely on imported raw material. The initiative is backed by Kilimo Trust , a
2011 January
                NGO dedicated to the promotion of market-led sustainable agriculture among East African Community members.

                THAILAND - palm oil market interventions: Following steep rises in the cost of crude palm oil, manufacturers sought
                government permission to raise palm oil retail prices by at least 25%, which, however, was not granted. Subsequently, temporary
                supply shortages and price inflation developed in the domestic market. Eventually, the government and manufacturers agreed on a
                one-time release of palm oil in retail packages at a fixed price so as to calm domestic markets. In turn, the government has given the
2011 January
                green light for a gradual upward adjustment in prices - in accordance with rising raw material prices and based on a review of real
                costs of production. The gradual increase in retail prices is expected to reduce the burden on consumers. Furthermore, the
                government requested the cooperation of large palm oil producers regarding a steady flow of supplies and informed that it would
                consider granting special palm oil import licenses.
                UNITED STATES - biodiesel subsidy: Finally, the extension of the biodiesel tax credit (US Dollar 1 per gallon) has been
2011 January    approved - referring to the year 2011 as well as, retroactively, to 2010. As a result, biodiesel production is expected to quickly
                return to previous levels.
                ARGENTINA - soybean trade: Reportedly, the market suffered from temporary disruptions as farmers halted all grains and
2011 February   oilseed sales in response to government restrictions on exports and because of new strikes by truckers and port workers over pay
                levels.
                BRAZIL - Amazon deforestation: Government sources reported that deforestation reached, for the second consecutive year, the
                lowest rate recorded since 1988. The record-breaking decrease in forest clearance is seen as a major contribution to reducing
2011 February   Brazil's greenhouse gas emissions. Policies that contributed to this development include sectoral pacts - such as the private sector
                supported effort to halt forest conversion for soybean production. In July 2010, the voluntary ban on the commercialization of soy
                grown in the Amazon had been extended for the fourth consecutive year.
                BRAZIL - oil palm expansion: Oil palm cultivation seems set to expand over the coming years in the northern state of Pará, close
                to the eastern Amazon forest. Reportedly, important investments are planned by a biofuels subsidiary of state-controlled mineral oil
                giant Petrobras and other companies. Production would be geared primarily towards the biodiesel market, mostly for exportation
                (or exportation of oil for subsequent transformation into biodiesel abroad). Apparently, investors are responding to a government
2011 February
                backed programme launched last May that offers soft loans and other incentives. Strict adherence to environmental and social
                safeguards is envisaged. Brazil‟s biodiesel demand for domestic use and export is set to grow steadily. Over 2 million tons are
                estimated to be required for domestic mandatory blending alone. Current biodiesel production relies primarily on soyoil as
                feedstock.
                BRAZIL - soybean futures: Sao Paulo based exchange BM&FBovespa announced the launch of a new, cash-settled soybean
2011 February
                derivative. The new contract is meant to offer exporters the opportunity to arbitrage with CME in Chicago.
                CANADA - rapeseed biodiesel GHG savings: According to a study presented by the country‟s canola industry, rapeseed based
                biodiesel reduces GHG emissions by 90% compared to fossil diesel. The study is based on comprehensive lifecycle analysis and
2011 February   uses a model deemed capable of measuring the energy balance and emissions of contaminants associated with the production and
                use of transportation fuels. In this regard, in September last year, a study commissioned by Environment Canada found gaps in the
                way emissions of GHG and other pollutants were currently measured.
                CANADA - research on oilseeds value addition - Camelina sativa and brassica carinata: Federal and provincial funding has
                been announced for the development of new camelina and brassica varieties for industrial applications. The crops can be grown on
2011 February   less productive, marginal lands. Research will focus on engineering the seeds‟ oil profile for use as petroleum substitutes in a variety
                of high value, non-fuel applications such as lubricants, hydraulic fluids and polymers. The ultimate aim is to diversify oilseed
                production, introducing industrial end-products that generate greater value than traditional oilseed products.
                CANADA - research on oilseeds value addition - Soybean and rapeseed: The federal government will invest in quality and
2011 February   yield improvement with a view to create new market opportunities. New short-season soybeans, rapeseed varieties with improved
                oil content, and better disease and pest management strategies are envisaged in the programme.
                CANADA - research on oilseeds value addition - Rapeseed protein: Federal funds for the development of new, value added
2011 February   products in agriculture will be spent for research on how to increase the value and use of rapeseed protein in the food/feed
                ingredient market. Ways to incorporate rapeseed protein into a variety of food/feed components will be explored.
                CHINA - rapeseed oil standards: Reportedly, the country‟s standards for rapeseed oil (last changed in 2004) are under review and
                could be amended to meet the quality and safety requirements of the domestic market. Private sources see the initiative as an effort
2011 February   to raise the competitiveness of the domestic rapeseed industry. Domestic rapeseed production has stagnated in recent years, and the
                share of rapeseed oil (from domestic sources) in total vegetable oil consumption has kept declining.

                CHINA - high yielding soybean: Reportedly, national researchers managed to raise the yield level of locally developed soybean
                variety „Zhonghuang 35‟ to the record level of 6075 kg per ha. The high yielding, high oil content variety is said to be adaptable to
2011 February   a wide range of production zones in the country‟s northern provinces, where it is proposed for future dissemination. Similar to
                rapeseed, domestic production of soybeans has stagnated in recent years (as both, yields and area remained largely unchanged), and
                the share of soy oil (from domestic sources) in total vegetable oil consumption has dropped sharply.
                CHINA - public reserve sales: The release of soya and rape seeds from public reserves continued in an effort to rein in rises in
                domestic prices for edible oils. However, until recently, actual sales have been limited, apparently because of unappealing floor
2011 February   prices used for the state auctions. Lately, sales seem to have improved thanks to the surge in prices for imported oilseeds. According
                to private sources, the government was also considering to release a sizeable amount of soy oil. The oil would be channelled to four
                companies which the government had previously ordered not to raise retail prices until March.
                ETHIOPIA - refinery inspection: Reportedly, 60 vegetable oil refineries have seen their licenses suspended as they failed to meet
2011 February   relevant quality standards. Apparently, several processors did not employ proper machinery or resorted to mixing oilseeds to refine
                the oil, a practice that is not allowed.
                EUROPEAN UNION - biodiesel production: According to private market observers, the recent surge in rapeseed oil prices -
                which has led to large premiums of the oil and of biodiesel over fossil diesel - could lead to the non-fulfilment of mandatory
2011 February   consumption levels in some member states, notably Germany. Reportedly, some processors and end users (particularly in power
                generation) have opted to temporarily suspend uneconomic biodiesel production/consumption, accepting to pay non-compliance
                fines instead.
                EUROPEAN UNION - biofuel environmental footprint: Release by the European Commission of guidelines on the impact of
                land use changes (ILUC) on carbon savings in biofuel utilization has been postponed by six months in order to ensure that best
                available science is used. An interim report states that ILUC could lesson carbon savings from biofuels. A new strategy on the
2011 February
                effects of biofuels on land use and development issues in third countries is not going to be issued before summer 2011. Reportedly,
                the Commission also stated that, in future, the sustainability criteria could be extended to raw materials used for the production of
                foods and feedstuffs.
                INDIA - jatropha biodiesel: Reportedly, a government backed study found that, to create a financially viable and sustainable
2011 February   biodiesel market, jatropha based diesel need to be priced at Rs 36 per litre. The current price is reported at Rs 26.5. The study
                therefore recommends the introduction of public incentives, grants and other support measures.
                INDONESIA - soybean import duties: Reportedly, to prevent consumer protests over rising food prices and stabilize markets, the
2011 February
                government decided to suspend import duties on selected food and feedstuffs, including soybeans.
                INDONESIA - palm oil export tax: In view of further rising international palm oil prices, the government decided to lift the
2011 February
                country‟s export tax to 25% in February - the highest level since the sliding tax scheme was introduced in 2007.
                LIBERIA - oil palm expansion: Malaysia-owned oil palm giant Sime Darby announced that this year it will start planting oil
2011 February   palms on a 220,000 ha concession granted by the government. Initially, the creation of some 30-35,000 new job opportunities is
                envisaged. The country‟s total land under oil palm amounted to 90,000 ha in 2009.
                MALAYSIA - oil palm productivity - Smallholders: MPOB has launched a government backed programme aimed at raising
                productivity among smallholders. The current average yield of 12-15 tons of FFB per ha is to be lifted to 18-20 tons in the short
                term. Interventions will focus the adoption of good agricultural practices and the production of higher quality fruit brunches.
                Furthermore, the government announced that it will support replanting activities over the 2011-2013 period. Independent
2011 February
                smallholders will be granted a one-off replanting sum followed by monthly payments for two years so as to compensate the loss of
                income from replanting activities. The supply of high-yielding hybrid planting material by the private sector is said to be adequate.
                Finally, sustainability certification of smallholder production according to RSPO principles will be facilitated. In Malaysia,
                smallholders are estimated to account for 40% of total oil palm area and 28% of national oil output.
                MALAYSIA - oil palm productivity - Plantation sector: During 2011-2013, replanting by large-scale private and government-
2011 February   linked plantation companies will also be encouraged via financial incentives. Reportedly, in order to avoid formation of a backlog,
                every year some 125,000 ha of oil palm need to be replanted countrywide.
                MALAYSIA - palm oil subsidies: Reportedly, public outlays for edible oil sales at subsidized prices have grown in line with
2011 February   rising palm oil prices. In an effort to counter hoarding and tight supplies, last month the government ordered producers to raise
                subsidized oil supplies by 20%.
                NIGERIA/MALAWI - improved soybean varieties: High performance varieties developed by IITA have been released in
                Nigeria and Malawi. The varieties were shown to give higher yields in multiple locations under both, on-station and on-farm trials.
2011 February
                Reportedly, in the region, soybean is rapidly gaining in popularity as animal feed, food and raw material for high-quality protein
                products, and because of its capacity to improve soil fertility.
                SRI LANKA - coconut production incentives: In an effort to encourage coconut cultivation and raise output, the government
2011 February
                decided to offer chemical fertilizers at subsidized prices to coconut producers nationwide.
                THAILAND - consumption policies, palm oil: Palm oil production costs have surged after domestic production was affected first
                by drought and then by widespread flooding, while global prices also rallied. As a result, an increasing shortage of palm cooking oil
                has developed in the domestic market. To avoid adverse effects on consumers, the government has taken the following measures: 1)
                Manufacturers have been urged to refrain from hoarding in light of soaring prices. Reportedly, the government managed to persuade
                leading producers to step up inventory releases and to abide by the capped price. 2) Eventually, in first week of January, an increase
2011 February
                in the government set retail price to 47 Bath (from currently 38 Bath) has been approved so as to reflect the rise in production costs.
                3) The government also promised to speed up palm oil imports (the first in three years) and said it would rethink the export plans
                for crude palm oil, also because of growing domestic demand from biodiesel producers. 4)The shift in mandatory biodiesel blending
                from B3 to B5 planned for January 2011 (which would lift CPO demand by the biofuel industry to around 1 million tons) will be
                postponed until at least the middle of 2011. The government‟s first priority remains to produce enough palm oil for food demand.5)
                THAILAND - consumption policies, meat/soymeal: Concerned about rising costs of living, the government plans to use help
                Finally, the government informed that it was exploring the possibility to set up a fund for subsidizing palm oil sales so as tothe tariff
2011 February   income earned from soybean meal imports (2% duty per ton) to subsidize meat production. The objective is to lower retail prices of
                meat through a reduction of the costs of animal feed.
                UNITED STATES - groundnut aflatoxin contamination: According to one industry source, this year, aflatoxin contamination
                will be above average and possibly the highest in the last two decades - a situation that raises concern due to the stringent limits in
                place today. Reportedly, the industry has learned how to reduce the aflatoxin risk via improved agronomic practices and thanks to
2011 February
                technological innovations. Contaminated product can be cleaned using blanching and sorting; however, a considerable amount of
                produce is lost in the process and processors lack the blanching capacity to clean the crop in a timely fashion.

                Trans fat policies - Japan - trans fat utilization: Following in the footsteps of other food companies, an important retail
                conglomerate, Seven & I Holdings Co., decided to accelerate its efforts at removing trans fat from house brand products and will
2011 February
                call on food suppliers to follow suit. Towards the end of last year, the government started promoting voluntary indication of trans
                fat content and said it was considering mandatory labelling for the future.
                Trans fat policies - United States - soybean oil market share: Industry sources report that since 2006, when mention of trans-fat
                content was made compulsory on food labels, the share of soybean oil in the domestic edible oils and fats market has dropped
                significantly - from 80% in 2006 to 65% in 2009. Once high-oleic soybean varieties start entering the market, that market share is
2011 February   expected to improve again. The oil derived from high-oleic varieties does not require hydrogenation (thus remaining trans fat free)
                and contains less saturated fat - two main attributes of what are considered more healthy oils. The food industry‟s demand for such
                oils is expected to expand steadily. Leading seed companies expect high-oleic soybean varieties to be commercially available from
                2012 onward.
                Trans fat policies - United States - labelling practices: An academic source recommends revising of the current labelling
                protocol on trans fat content in food items so as to better protect consumers from inadvertent intake of medically significant
2011 February   amounts of the harmful fat. Currently, when a product contains less than 0.5 grams of trans fat, labels can list the trans fat content
                as zero. Such labelling practice may make it difficult for the public to estimate the actual amount of trans fat consumed - an
                important task, considering that maximum recommended intake has been set at 1.11 grams per day.
                Trans fat policies - United States - local utilization ban: In the State of California, the ban on trans fats in restaurants introduced
2011 February
                in January 2010 is now followed by an identical ban regarding all bakery goods.
                Coconut water - Increased interest in coconut water as a sports beverage and health drink is being reported from various regions.
                Allegedly, the liquid, found inside the young coconut and naturally rich in vitamins and minerals, has become one of the fastest
                growing categories in the global beverage industry. As the market for coconut water grows in both, main coconut growing countries
                as well as developed economies, harvesting young nuts for coconut water could develop into an economically attractive alternative
2011 February
                to conventional copra processing into oil/meal. Thanks to the introduction of state-of-the-art processing and packaging techniques,
                international trade in coconut water is expected to expand. Import demand is seen rising in the United States, where beverage
                companies like Pepsi Cola and Coca Cola have started to develop coconut water based sports and „wellness‟ drinks.

                Jatropha investment - Further private investments in the cultivation of jatropha as biofuel feedstock are reported from Asia. A
                newly formed joint venture is set to expand cultivation in India and to explore possibilities in Malaysia and Indonesia. The project
2011 February
                envisages improving productivity via comprehensive breeding programmes. The key objective is to develop hybrid plants with
                higher yields, synchronized maturation and desirable self branching patterns.
                Sustainable palm oil - Sourcing policies: Dutch bakery ingredient firm Sonneveld will join the list of food processors that commit
                to use (from 2013 onward) exclusively RSPO certified sustainable palm oil. Challenged by developments in consumer markets, the
                company started supporting sustainable production practices last year by buying Green Palm certificates. The decision to switch to
2011 February
                certified palm oil consolidates the company‟s efforts in this field. In this context, last year, the Netherlands – Europe‟s leading hub
                for the import and distribution of palm oil – said it was aiming at importing exclusively certified palm oil from 2015 onward.

                Sustainable palm oil - World production and trade: RSPO reported that in 2010 global production of certified palm oil
2011 February   amounted to 3.8 million tons compared to 2.3 million in 2009, while sales rose from less than 500,000 tons to around 1.6 million
                tons.
                GM soybean issues - Sourcing non-GM soy has become increasingly difficult in recent years as GM crops are gradually taking
                over the marketplace. According to a private source in the EU some feed compounders cannot fulfil contracts due to difficulties in
2011 February   sourcing non-GM soy. The cost of non-GM food ingredients is said to exceed that of their GM equivalents by 10-20%. An EU
                farmers association stated that this cost premium is not being reflected in returns to farmers. Consequently, in the long run,
                processors and retailers might be forced to drop non-GM ingredients for all but (higher priced) organic products.
                GM soybean issues - Weed herbicide resistance: A group of scientists has warned that, in the long term, the widespread adoption
                of GM soy varieties resistant to the herbicide glyphosate is bound to lead to weed resistance problems. Reportedly, farmers in
2011 February   Australia are already facing such problems after heavy relying and overusing glyphosate, and also US farming is said to be at risk.
                Herbicide rotation and mechanical means to destroy weed seed ought to be considered, in particular where no-tillage is practiced.

                GM soybean issues - Brazil GM soy: Local sources estimate the adoption rate of GM soybeans to reach 76% in the current
                season, compared to around 60% in 2008 and only 13% in 2004. Interestingly, the following factors are reported to have slowed
2011 February   down the spread of GM soybean lately: the spread of glyphosate resistant weeds; price premiums for GM seed and payment of
                royalties (or trade charges in case the royalties are avoided); and market campaigns in favour of conventional soybean.

                BANGLADESH - edible oil import incentive: After introducing retail price controls to protect consumers from the effects of
                soaring international vegetable oil prices, the government now decided to reduce the import duty on edible oils from 15% to 10%.
                There is concern that, with spiralling domestic prices, per caput consumption of edible oil could fall to critically low levels. Retail
2011 March
                prices for palm oil (an essential food item) rose to levels not seen since March 2008, while overall monthly food price inflation has
                exceeded 10 percent. In a separate move, the country‟s banks have been asked to limit the interest rate charged on loans taken to
                import essential food commodities.
                CANADA - mandatory biodiesel use: Compulsory blending of conventional diesel with 2% biodiesel has come into effect across
2011 March
                the nation in February.
             CHINA: inflation control measures - Central Bank support: Reflecting government concerns that rising food costs are
             contributing to the country‟s high inflation rate, China‟s central bank has announced that it will use monetary policy tools - such as
2011 March   refinancing and rediscount loans - to promote grain production and thus stabilize prices. Similar to rice and wheat flour, edible oil
             prices rose 8% since October of last year. Prices for food items make up 30% of the country‟s overall consumer price index basket.

             CHINA: inflation control measures - vegetable oil import duties: Reportedly, relevant ministries have held consultations on
             whether to temporarily lower import taxes on soybeans and soya oil (to, respectively, 1% and 3%), while keeping palm oil duties
             unchanged (at 9%). The move would assist the country‟s crushing and refining industry in coping with rising world prices and
2011 March
             hopefully contribute to controlling domestic inflation. By leaving the duty on palm oil unchanged, shipments of that oil could suffer.


             CHINA: inflation control measures - public reserve sales: In February, successful completion of another state auction of
2011 March   rapeseed oil from public reserves (the seventh since October of last year) has been reported. Allegedly, the auctions played a
             positive role in stabilizing prices.
             EUROPEAN UNION - GMO traces in animal feed shipments: After two years of negotiations, member countries agreed to
             grant technical clearance for change proposed to EU regulations on traces of unauthorized GMO in animal feed consignments. The
             current zero tolerance approach would be replaced by a new 0.1% tolerance threshold, which the industry considers to be more
2011 March
             realistic and easier to implemet. If introduced, the change could safeguard vital supplies of protein feeds (notably soymeal) to the
             EU. In 2009, shipments of soymeal to the EU came to a temporary standstill following the detection of (unauthorized) GMO traces
             at European ports.
             EUROPEAN UNION - ban of animal by-products in livestock feed: A partial easing of the bans introduced in the mid 1990s
             (to combat BSE risks) will have to wait at least until the end of this year. While the ban on using animal protein (i.e. meat and bone
             meal or MBM) in feed destined for ruminants as well as the prohibition of intra-species feeding will remain in place, plans are
2011 March
             under consideration to allow farmers to feed MBM from pigs to poultry and vice versa. In case of approval, partial lifting of the
             bans would allow the EU feed and livestock industries to significantly cut their costs and to lower the block‟s reliance on imported
             soybean meal.
             INDIA - oil palm expansion: The industry expressed doubts regarding recent government initiatives to encourage oil palm
             cultivation and thus lift palm oil output to 4 million tons over the next 5 years. According to SEA, oil palm cultivation faces
2011 March
             important hurdles, including insufficient irrigation facilities. Furthermore, legal impediments and the fact that oil palm does not
             enjoy plantation crop status are said to discourage private sector investments.
             INDIA - import duties on vegetable oils: The government informed that the country‟s duty structure for edible oils will remain
             unchanged, with crude oils attracting zero duties and refined produce charged 7.5% so as to protect domestic refining industries.
             Considering the strong rise in world prices and, consequently, in domestic edible oil prices, industry sources were expecting a
2011 March
             reduction in tariffs for refined oils. Government officials stated that the duties were not contributing to food-price driven inflation
             and pointed to recent signs of easing inflation. The only tariff change introduced concerns crude palm stearin, whose 10% duty will
             be discontinued. The duty elimination is not expected to have a noteworthy effect on stearin markets.
             INDIA - edible oil and oilseed marketing controls: With food prices still high, the government may decide to retain limits
             imposed on the volume of edible oil and oilseeds (as well as sugar) that traders may hold in stock. The limitations, which are meant
             to check hoarding and thus price rises, is due to expire in March. On edible oil and oilseeds, stock holding restrictions are currently
2011 March
             applied in 18 federal states. Edible oil prices were reported to have risen about 25% nationwide since November last year, mirroring
             the rise in international prices. To date, several fiscal and monetary measures have been tried to bring down the prices for basic
             foodstuffs.
             INDIA - vegetable oil procurement: Reportedly, to assist low-income consumers affected by spiralling prices, the government
2011 March   decided to step up domestic purchases of edible oils (as well as pulses) for distribution under public welfare schemes.

             INDIA/MALAYSIA - free trade pact: The newly signed free trade agreement (which expands on the India-ASEAN trade pact
2011 March
             that came into effect January 2010) includes significant additional tariff concessions for Malaysia‟s palm oil exports to India.
             INDONESIA - soybean consumer price: Reportedly, the government measure of temporarily suspending soybean import duties
2011 March   has yet to result in the hoped for stabilization of domestic retail prices. Apparently, the government is closely observing the market
             to decide on further policy steps to be taken.
             INDONESIA - palm oil export tax: During March, export taxes in the palm oil complex will stay at the record level established in
             February. Custom officers reported that spiralling prices for crude palm oil have led to an extraordinary increase in the country‟s
2011 March   export tax revenues. In January alone, the export tax collected amounted to 48% of the target set for the entire year. Given the hike
             in palm oil prices, the government has stepped up the control of deliveries to the national market to ensure that domestic demand is
             met.
             LIBYA - edible oil taxes and duties: Concerned about the impact of rising prices on consumers, the government decided to
2011 March   suspend sales taxes and custom duties on domestically produced and imported vegetable oils (as well as wheat products and rice).

             MALAYSIA - minimum wages for oil palm plantation workers: Reportedly, the Human Resources Ministry started discussions
2011 March   with government linked palm oil companies with the aim to raise wages for local and foreign plantation workers. Officials stated
             that workers deserved improved wages, mirroring the good prices fetched by palm oil.
             MALAYSIA - palm oil export earnings: Reportedly, the country‟s revenue from plantation crop exports has climbed to a new
             record last year, surpassing the 2008 record. Earnings rose as global demand for vegetable oils, rubber and cocoa surpassed supply,
2011 March   leading to higher world prices. To a certain extent, higher demand was also fuelled by the appreciation of the Ringgit against the US
             dollar, the currency in which exports tend to be denominated. Palm oil accounted for the bulk of last year‟s plantation crop export
             earnings.
             MALAYSIA - oil palm seed market: Malaysia is estimated to produce close to 90 million oil palm seeds per year. About two
             thirds are for domestic use, while the remainder enters exports. The country is a world leader in oil palm breeding and cloning
             programmes and owns some of the highest yielding varieties. Since the 1970s, exportation is prohibited to ensure domestic supplies
             as well as to protect related IPRs. Current exports are restricted to Malaysian companies operating overseas and to government-to-
2011 March   government trade with selected countries, including Colombia, Honduras, Indonesia, Sierra Leone and Thailand. Reportedly, one of
             the country‟s leading seed producers (Felda Agricultural Services) is proposing to drop the existing seed export ban. Allegedly, the
             country now produces enough seed to cater for both domestic use as well as the export market. Overseas demand for certified seed
             is said to be huge, with Indonesia and Africa alone requiring, respectively, 130 and 50 million seedlings per year.

             PAKISTAN - vegetable oil import duties: Contrary to earlier announcements, import duties on palm and soya oil will remain
2011 March   unchanged, according to industry sources. Late last year, duty cuts had been envisaged with a view to halt the escalation in food
             costs. Allegedly, the government is determined to retain the revenue derived from import taxation.
             RUSSIAN FEDERATION - soybean market: Reportedly, domestic soybean producers have expressed concern over recent
             imports of soybean meal by a state grain trader. Foreign purchases have been justified by the growing domestic shortage in feed
2011 March   grains. Concerned that local feed manufacturers might increasingly rely on imported protein feeds, soybean producers in the
             southern Kuban region, who produced a record crop this season, have approached the local government asking for protection.

             SOUTH KOREA- soybean state reserves: Reportedly, the government announced the inclusion of soybeans (as well as wheat
2011 March   and maize) in public reserves in addition to rice. The measures aims at stabilizing domestic supplies of basic foodstuffs while global
             supplies are tight and world prices rise.
             SRI LANKA - fertiliser subsidization: Reportedly, the government is implementing a new scheme to distribute fertilizer to
2011 March   coconut farmers at a reduced prices. The measure is meant to allow growers to raise production, thus taking advantage of the current
             record world prices for coconut products.
             THAILAND - palm oil consumption policies: Following up on earlier announcements, the government has implemented several
             measures to address the domestic shortage in palm oil: (i) crude palm oil originally reserved for biofuel production is being refined
             into cooking oil; (ii) palm oil stocks held by the private sector are being turned into cooking oil and distributed at discounted prices
             by the Public Warehouse Organization; and (iii) crude palm oil is being imported with government permission. State ordered
2011 March
             refining operations are subsidized to ensure that end prices do not exceed the ceiling set by the government. As to foreign
             purchases, special import permits amount to a total of 120 000 tons. Shipments have been restricted to February and March in order
             not to interfere with new local supplies expected from April onward. The distribution of foreign palm oil to food industries and
             other domestic users is centrally controlled.
             UKRAINE - voluntary sunflower oil export restriction: Reportedly, to avert the threat of formal export restrictions, the industry
             has agreed to temporarily cut sunflower oil exports so as to increase supplies to the domestic market. The government considers part
2011 March
             of domestic output as a social good whose price is not allowed to exceed a given level. Following the recent surge in prices, one oil
             producer has come under investigation for possible abuse of market monopoly.
             Global soybean market pattern - role of the United States and China: Concentration in the global soybean market continued to
             increase in recent years, as the example of the United States and China demonstrates. Last year, China turned into the USA‟s largest
             market (in value terms) for agricultural exports, primarily on the account of soybeans. For certain products, notably soybeans (but
             also vegetable oil, sugar and cotton), China has become highly dependent on imports, while reliance on international markets
2011 March   remains minimal in the case of the other main staples, rice, wheat and maize. Different from the past, the country is making full use
             of both, the domestic and overseas markets to achieve food security. As a result, China‟s influence on world markets has increased
             greatly as well as vice versa. For instance, China‟s soybean import demand is increasingly influencing the world soybean price,
             while general increases in world prices started affecting markets in China, exposing the country to imported inflation.

             Oil palm expansion - Brazil: Global agri-business firm ADM is joining the list of oil palm investors in the state of Parà. The
             planned investment aims at diversifying the company‟s feedstock options for biodiesel production. Over the next five years, 12 000
             ha of palm will be developed along with a processing plant. The company is dedicated to using environmentally and socially
2011 March   sustainable production practices. As part of Brazil‟s Social Fuel Stamp programme, ADM has committed to purchasing produce
             also from approximately 600 small family farms (cultivating 6 000 ha) in the neighbourhood, providing them with technical
             assistance and guidance on sustainable production methods. ADM‟s plantation and processing facility will conform to relevant
             RSPO guidelines.
             Vegetable oil-based aviation fuel: European carrier Lufthansa is set to start a six-months trial with scheduled commercial
2011 March   passenger flights powered partly by renewable fuel. The company is waiting for the 50/50 blend of vegetable oil-based biofuel and
             traditional kerosene to be certified by regulators.
             New private-public partnerships: Mexico - sustainable small-scale sunflowerseed: The Inter-American Development Bank and
             PepsiCo will join forces in a social development initiative to revive sunflower production in Mexico. The 5-year partnership
2011 March   includes the provision of loans, management support and technical assistance to small farmers. PepsiCo is committed to purchase
             the farmers‟ entire crop over 7 years, thereby securing the supply of edible for the company‟s production of snacks in the country.
             Production will be based on high-oleic sunflower varieties that valued for their special health properties.
             New private-public partnerships: Indonesia - forest conservation in oil palm: Indonesian oil palm business Golden Agri-
             Resources Ltd has entered a multi-stakeholder partnership involving the Government of Indonesia and The Forest Trust that aims at
             achieving long-term sustainability in its palm oil operations - in both, environmental and social terms. In an effort to find solutions
2011 March   towards forest conservation, the development of high carbon stock forests, high conservation value forest areas and peat land will be
             subject to strict controls. In addition, free, prior and informed consent for indigenous and local communities will be guaranteed as
             will compliance with relevant laws and national interpretations of RSPO principles. The company committed to regularly evaluate
             and publicly report its performance in these areas.
             Rapeseed - blackleg disease control: By sequencing the genome of the blackleg fungus, a French-Australian research team has
             made a significant step towards controlling the blackleg disease, which causes widespread damage to rapeseed cultivation
             worldwide. The discovery will help to improve disease resistance in rapeseed varieties and will allow to tell farmers which varieties
2011 March
             they should plant to prevent crop damage. Reportedly, in 2003, the disease caused 90% yield losses in some regions of Australia,
             and since 2009, China requires rapeseed imports to be certified 100% disease free to prevent the fungus from spreading in its
             territory.
             Environmental footprint of plantation crops: A new international research project called Stability of Altered Forest Ecosystems
             (SAFE) has been launched in Malaysia with government backing. The project will look into the effects of forest fragmentation and
             the impact plantations have on biodiversity. The private foundation that is funding the project (and has links to oil palm business)
2011 March
             committed to publish all research results and to promote corrective action if required. Meanwhile, an international NGO has issued
             a report claiming that oil palm expansion in Borneo Island continues to include conversion of carbon-rich peat swamp forests.

             ARGENTINA - trade regulation: ONCCA, the government agency responsible for regulating agricultural trade has been
2011 April   dissolved. Its responsibilities, including the administration of subsidies and export permits will be overseen by an interministerial
             commission. Reportedly, export licenses will be issues by the Ministry of Agriculture and need to be renewed every month.
             ARGENTINA - trade regulation: Reportedly, six of the country‟s leading grain export firms have been suspended from a
             government registry while the state tax agency is investigating about possible tax evasion. The temporary suspension limits the
2011 April
             companies‟ possibility to export and could expose them to higher income taxation. A contraction in the country‟s shipments of
             soybeans, soyoil, soymeal as well as biodiesel is possible.
             CHINA - sales from state reserves: Reportedly, the last state auction of rapeseed oil ended with a sell out thanks to attractive floor
             prices, bringing the total volume of sales since last October to 870 000 tonnes. By contrast, two consecutive auctions of soybeans
             ended with zero sales. Apparently, in the latter case, floor prices were set above market prices. Ample commercial stocks following
2011 April
             massive imports also weighed on buying interest. It appears that to date only a fraction of public soybean reserves (estimated at 2.36
             million tons) has been sold. Meanwhile, the government is coming under pressure to free storage space in order to be able to buy
             from the new crop.
             CHINA - draft 12th 5-year plan (2011-2015): According to government officials, the country will not significantly raise its
             imports of staple agricultural commodities during the next five years given the availability of ample state reserves and thabks to the
             anticipated production increases. To achieve the production targets, the government is committed to strictly protect arable land,
2011 April   keep total crop acreage stable, and raise productivity levels. However, in the case of oilseeds and derived products, improving the
             country‟s self-sufficiency rate continues to pose challenges. Home-based production is not keeping pace with deamd expansion.
             Total oilseed production in 2011 is targeted to grow no more than 0.3% from last year. Whereas minimum purchase prices for
             grains shall be lifted by 22%, oilseeds don‟t enjoy such support.
             CHINA - promotion of alternative oilcrops: Reportedly, state officials recommended to encourage the development of woody oil-
             bearing trees to lower the country‟s import dependence on oilseeds and derived products. Walnut, oil-tea camellia, olive and similar
2011 April
             trees are said to offer considerable untapped potential and could be established on non-farming land, such as mountainous areas. To
             increase cultivation of these crops specific producer support measures will be needed.
             CHINA - confectionary soybean: Reportedly, confectionary use of domestically grown soybeans has expanded significantly in
             recent years. With demand for protein foods on the rise, the country‟s food industry is keen to process whole soybeans for both
             domestic consumption and export. Food manufacturers are attracted by the non-GMO nature and high protein content of
2011 April   domestically grown beans. As a result of this trend, the share of home-grown beans that is not crushed has grown to around 65-
             70%. Also the amount of imported soybeans that is absorbed by the food industry is increasing. At the same time, China‟s exports
             of soy-based protein foods (which typically are certified GM-free) have increased. The country is currently estimated to account for
             half of total international trade of such products.
             EUROPEAN UNION - GM traces in imports: While waiting for Brussels to confirm the modification of the EU‟s regulation
             governing GM traces in animal feed shipments (see also issue no. 23, March 2011), trade organizations already started lobbying for
2011 April
             a comparable regulation to be introduced for shipments destined for human consumption. The European Commission informed that
             currently there were no plans to draft such a proposal.
             EUROPEAN UNION - special biodiesel duties: Reportedly, the European Commission is considering widening the anti-dumping
             duties imposed on US biodiesel imports in March 2009 and possibly extending them to Canada. In future, purchases of certain
             biodiesel blends from Canada and all US imports could face duties in excess of 400 € per tonne. The initiative follows a year of
2011 April
             investigations, which, reportedly, revealed transhipments of US material through Canada as well as a shift in US exports to B19
             blends to circumvent existing duties. If endorsed by EU members, the new duties could come into force towards end 2011 and
             remain in place until 2014.
             EUROPEAN UNION/MALAYSIA - palm oil trade: Private interests in Malaysia are increasingly frustrated by the EU‟s strict
             requirements regarding the environmental footprint of biofuel feedstock, notably palm oil. EU officials underlined that the
             regulations apply to all feedstock equally and that all shipments of certified sustainable produce are welcome. It was also pointed
2011 April
             out that shipments destined for food and industrial uses other than biofuel faced no formal restrictions. As to the ongoing bilateral
             free trade agreement talks between the two countries, they will likely include discussions about a sustainability chapter addressing
             EU palm oil importation issues.
             GHANA - new commodity exchange: Official sources announced the establishment of a commodity exchange for agricultural
2011 April   products, focusing on soybeans, rice and maize. A regulatory framework is currently under preparation. Operations are likely to
             begin late in 2012.
             INDIA - oil palm development: The following details have emerged regarding the government‟s new plans in this field: a
2011 April   budgetary allocation of Rs 300 crore has been made to aid the establishment of 60 000 ha of new plantations. Anticipating a yield
             of 5 tonnes per ha, the initiative aims at an annual output of 300 000 tonnes of palm oil after 5 years.
             INDONESIA - palm oil export tax: Mirroring a decrease in the international price of palm oil, in April, the country‟s export tax
2011 April
             on crude palm oil will be lowered from previously 25% to 22.5%.
             INDONESIA - palm oil export tax: Reportedly, the government is looking into the possibility of replacing the progressive
             taxation system with a flat tax on crude palm oil. Various options are being considered. Critics of the progressive tax system, which
2011 April
             was introduced to safeguard supplies of palm oil to the domestic cooking oil industry, say that progressive taxation tends to
             discourage farmers and hampers the development of the downstream palm oil industry.
             MALAYSIA - biodiesel developments: Reportedly, the government remains committed to introduce mandatory B5 blending this
             year although palm oil sold for traditional uses has been fetching record prices in recent months. From June, with a 5-year delay,
             sales of blended diesel will be introduced in stages in the different states. Blending facilities are being set up with government
             support. To make biodiesel competitive, sales will be tax exempt and a variable subsidy will apply to pump prices. High mineral oil
2011 April
             prices and the anticipated relaxation in palm oil prices should help containing government outlays. This year‟s step-wise
             implementation is estimated to require maximum 100 000 tonnes of biodiesel; later, for nationwide operation, 500 000 tons will be
             required. For comparison, estimates of the country‟s installed production capacity range between 2.6 and 3.4 million tons. Until
             now, export did not exceed 200 000 tonnes (unofficial records).
             MALAYSIA - sustainable oil palm development: The Sarawak State Government (Borneo Island) issued a statement illustrating
             its commitment towards socially responsible and environmentally sustainable oil palm development. Last year, Sarawak reported
2011 April   the largest oil palm expansion in the country. Currently, the state has allocated 700 000 hectares of peatland for oil palm cultivation.
             Initiatives taken to ensure responsible peatland use are detailed in the document, which is available at
             http://www.sarawak.gov.my/en/media-centre/in-the-news.
             NEW ZEALAND - biodiesel subsidy: Under a 3-year programme launched by the government in 2009 to encourage investment
             into national biodiesel production a subsidy is being granted on all sales of domestically produced biodiesel. Reportedly, take-up of
2011 April   the subsidy has, however, been slow, suggesting limited industry investment in the sector. According to industry sources, now a
             number of large projects are ready for implementation; but investors are asking for assurances from the government that the current
             subsidy will be extended for further three years.
             SOUTH KOREA - soybean import duties: In addition to the recent inclusion of soybeans in state reserves (to stabilize domestic
2011 April   foodstuff supplies), the government decided to reduce the import tariff on soybeans (and other food commodities). The measures is
             scheduled to remain in place until the end of 2011.
             THAILAND - palm oil consumption policies: In spite of indications that palm oil prices at the global level (and hence also at
             national level) are set to come down, the government decided to retain the price control measures introduced last January (to
2011 April   stabilize the domestic market) for three more months. Hence, the palm oil retail price remains at 47 Bath per litre and the FFB price
             at which crushers buy from farmers remains at 6 Bath per kg. Also, for a given volume of purchases, eventual losses incurred by
             crushers and refiners will be compensated for by a state subsidy of 1.79 Bath per litre.
             UNITED STATES/EUROPEAN UNION - soyoil-based biodiesel: The issue of compliance of soyoil-based biodiesel with the
             respective renewable energy regulations in force in the two countries continues to be unresolved. While under the United States‟
             RFS-2, the default GHG emission saving of soyoil-based biodiesel was defined as 57% (which compares to a minimum requirement
             of 50%), under the EU‟s RED, biodiesel made from soyoil credits for just 31% GHG emission reduction (as against the requisite
2011 April
             35%). The US industry claims that the RED‟s gradual introduction among EU members has started eroding US shipments of
             soybeans and soyoil to that market (- virtually all of the soybean oil processed from US soybeans in the EU is reported to be used
             for biodiesel -) and is therefore urging the US government to initiate bilateral discussions with the EU and to seek consultations
             with third, equally affected countries.
             Sourcing of certified sustainable palm oil for food: US food company Kellogg announced that its world wide palm oil use will
             be matched by purchases of RSPO-endorsed GreenPalm certificates (NB: the money raised in certificate trading is used to reward
             palm producers for working in a sustainable and responsible way). Once sustainably grown produce becomes available in sufficient
2011 April
             quantities via reliable, fully segregated supply chains the company committed to purchasing directly certified sustainable palm oil.
             Reportedly, today, reliable and segregated supply chains for certified produce can only be found in the European market.

             Sourcing of certified sustainable palm oil for food: From last month, the UK subsidiary of AAK, a global manufacturer of oils
             and fats, is using certified sustainable palm oil in its full range of bakery fats and other standard products. The company committed
2011 April   to do the same for palm oil stearin from 2012/13 onward. Customers have been reminded that in order to claim ethical sourcing at
             subsequent marketing stages, all parties of the supply chain must become members of RSPO and need to obtain RSPO approval of
             their equipment and operations.
             Oil palm productivity: Effort are underway to accelerate, through improved breeding techniques, the development and commercial
             release of superior seed material without making recourse to genetic modification. Malaysian biotechnology company ACGT
2011 April
             (Genting Plantations Bhd) informed about its work on genomic-based marker-assisted selection technology, which aims at reducing
             the long breeding cycle of oil palm from 12 to 6 years.
             Biofuel certification and supply issues: Integrated palm oil supply chain: Global renewable energy provider Mission NewEnergy
             Ltd. and Malaysian palm oil producer Felda Global Group have entered into a long term supply agreement establishing a fully
             integrated supply chain for certified palm biodiesel. To comply with European GHG saving targets, carbon emissions along the
2011 April
             entire supply chain will be certified using ISCC (International Sustainability & Carbon Certification System). ISCC certification
             conforms to the EU‟s Renewable Energy Directive and, in Germany, companies supplying biofuel need it in order to qualify for
             state subsidies and privileges.
             Biofuel certification and supply issues: New certification system: The Roundtable on Sustainable Biofuels (RSB) has launched
             the RSB Certification System. Reportedly, the system provides the assurances operators need to guarantee the sustainability and
2011 April
             traceability of their feedstock and fuels. The system has received provisional recognition under Germany‟s regulatory scheme for
             biofuels.
             Jatropha-based aviation fuel: Mexican air carrier Interjet and Airbus reported their first test flight using locally produced
             jatropha-based biofuel. The objective is to commercialize aviation biofuel in the country and thereby allow carbon neutral
2011 April
             expansion in the sector. The companies pointed to CO2 life cycle studies showing that the use of jatropha-based fuel can reduce the
             overall CO2 footprint by up to 80% compared to standard aviation kerosene.
             New functional fats: The introduction, in various countries, of official requirements to eliminate health damaging trans-fat from
             food products resulted in food manufacturers increasing the use of saturated fat where solid fats are needed for functionality.
2011 April   Although saturated fats are a valid alternative to trans-fat, their intake also needs to be controlled. In this context, global vegetable
             oil supplier IOI-Loders Croklaan has launched two new shortenings for use in the bakery industry that, allegedly, allow reducing
             saturated fat utilization.
           ARGENTINA - foreign land ownership: Concerned that overseas investors could control a significant percentage of the
           country‟s farmland, the government reiterated plans to limit the amount of farmland foreigners can buy. Apparently, with global
           commodity prices rising, foreign investment in fertile farmland in Argentina and Brazil is increasing, leading, inter alia, to rising
           land prices. Reportedly, Brazil, Uruguay and Paraguay already took steps to retain control over land ownership. In the countries
2001 May
           concerned, the agricultural sector contributes significantly to export earnings and tax revenues. Under Argentina‟s proposed policy,
           foreign land purchase ability could be restricted to 1,000 hectares. Past land acquisitions would not be affected. Recently, we
           reported about negotiations between Argentinean authorities and investors from China over the development of 200,000 ha of
           soybeans (MPPU October 2010).
           ARGENTINA - trade control: The agricultural ministry assured the industry that the government was not considering to create a
2011 May   national grain board controlling trade, and in particular the exportation of maize, oilseeds or oilseed products. He added, that,
           however, the administration stood by its intervention in agricultural markets to ensure adequate domestic supplies.
           AUSTRALIA - draft palm oil labelling bill: Tabled in parliament last year, the proposed bill calls for specific labelling standards
           being applied to food products that contain palm oil. Under current labelling laws, palm oil (which is estimated to be used in
           approx. 40 % of food products) falls under the generic label “vegetable oil”. Under the proposed bill, consumers would be
           specifically informed about the inclusion of palm oil in foods. Furthermore, the use of certified sustainable palm oil (conform with
           RSPO criteria) would be encouraged. In a public hearing, Malaysian officials criticized the bill stating that it was based on
2011 May
           misleading claims, that palm oil would be singled out as the only product with mandatory labelling for reasons not related to health
           or nutrition, and that palm oil would be classified as a single generic product based on the environmental impact of production
           methods without differentiating between countries of origin. Malaysia‟s extensive forest and wildlife preservation policies were also
           illustrated. As to the bill‟s recommended use of certified sustainable produce, attention was drawn to the high cost of certification,
           especially for smallholder producers.
           AUSTRALIA - special biodiesel duties: The country introduced anti-dumping duties on imports of biodiesel from the United
           States. Triggered by complaints from local biodiesel producers, an official investigation found that shipments of subsidised
2011 May   biodiesel had been sold to Australia, harming the domestic industry. Australia itself currently offers a tax break worth around A$
           0.40 per litre to producers and importers of biodiesel. The measures is scheduled to expire in June this year. Australia‟s anti-
           dumping initiative is very sililar to measures introduced in the European Union.
           BRAZIL - biodiesel policy: Compared to the previous administration, the new government is reportedly taking a more moderate
           stance regarding domestic biodiesel production and utilization. The new trend is said to reflects concerns about the country‟s high
           dependence on soyoil as feedstock (at a time of tight supplies and high prices in Brazil and worldwide) as well as about insufficient
           supplies of alternative oils as raw material for biodiesel. Reportedly, last year the biodiesel industry absorbed as much as 25% of
2011 May
           total domestic soyoil output - compared to less than 5% three years earlier. The second most used feedstock is tallow, part of which
           is imported into the country. Reportedly, the government negotiated with the biodiesel industry to delay the introduction of
           mandatory B7 admixture (originally planned for January 2011) by at least 6 month, thus keeping in place the B5 level. In the
           meantime, measures will be taken to encourage production of alternative vegetable oil feedstock for biodiesel.
           CHINA - sales from state reserves, soybean seed: Reportedly, state auctions aimed at cooling the rise in food prices have
           continued. Following two auctions in March that failed to attract buyers‟ interest due to high floor prices, in April, auction prices
           were set at levels attractive to crushers, i.e. Yuan 3500 per ton, which was about Yuan 200 below the market value of soybeans
2011 May   imported from Brazil. According to trade sources, crushers buying from state reserves at discounted prices have agreed to cap retail
           prices for soybean oil at some Yuan 1000 less than the current market price, thus contributing to government efforts to control
           continued food price inflation. Reportedly, the on-going sale from state reserves could amount to up to 3 million tons, which, if
           confirmed, could lead to the deferral or cancellation of several import orders.
           CHINA - sales from state reserves, edible oils: Auction of rapeseed oil state reserves (aimed at cooling the rise in food prices)
           continued in April. Reportedly, part of the rapeseed oil sales was reserved to state-owned refining companies. Auction prices were
           reported to range between Yuan 8900 and 9600 per ton (which compares to market values around Yuan 10100), with the lower
2011 May   price being reserved for state-owned companies that committed to keeping edible oil prices stable for another two months. Private
           sources estimate that cumulative sales during the current season to amount to 1.5-2 million tons. During the forthcoming season,
           public stockpiling could be scaled down due to the expected higher rapeseed prices. Soybean oil: Public soybean oil reserves have
           been estimated at 2.2 million tons in mid April.
           CHINA - retail price control: Reportedly, the government decided to extend the 3-months cap on vegetable oil retail prices that
2011 May
           was pushed on leading crushing and refining companies last January with a view to control food price inflation.
           CHINA - biofuel policies: Official sources reiterated the country‟s decision to limit all uses of grains and edible oils for biofuel,
2011 May   alcohol and other non-food/feed purposes. The move confirms the country‟s determination to protect domestic supplies of staples
           products for human and animal consumption.
           ETHIOPIA - edible oil sales: Reportedly, domestic markets have run out of edible oil supplies, which depend heavily on imports.
           Since retail price caps have been introduced last January to protect consumers, importers found it increasingly difficult to market
           vegetable oils, the prices of which have surged in international markets. To break the deadlock, the government reportedly decided
2011 May
           to buy all palm oil stocked by traders and release it onto the market, shouldering the losses resulting from price differentials. The
           country‟s edible oil market is expected to be dominated by government sales for the remainder of this year.

           EUROPEAN UNION - energy taxation policy: Reportedly, the European Commission is set to table a proposal to reform energy
           taxation throughout the Union. The proposal aims at improving coherence and creating a level playing field for all types of fuels,
           including environmentally friendly biofuels, thereby helping the bloc to achieve climate change objectives. The new directive
2011 May   would separate fuel into two taxable components based on their CO2 and energy content, rather than being solely based on volume
           as at present. The proposed regime could alter the tax structure for different types of fuels, with important repercussions for
           automotive industries and other industrial sectors as well as for (currently tax exempted) agricultural producers. The draft law
           would need need to be approved by the European Parliament and Council.
           INDIA - edible oil marketing controls: Scheduled to expire in last March, the limits imposed on the volume of edible oil and
2011 May   oilseeds that traders may hold in stock have now been extended until the end of September. The limitations are meant to prevent
           hoarding and thus price rises as well as to facilitate state procurement when domestic supplies are tight.
           INDONESIA - palm oil export tax: Mirroring a further drops in the international price of palm oil, in May, the country‟s sliding
2011 May   export tax on crude palm oil will be lowered from previously 22.5 to 17.5%. The local oil palm industry continued to criticize the
           taxation system, claiming that it hampers trade and discourages investment.
           KENYA - GM crops: Reportedly, Kenya is set to join the list of African countries in favour of growing genetically modified crops.
           According to the press, the long awaited Biosafety Act and respective regulations could come into effect this month. Under the new
           policy, the National Biosafety Authority will be responsible for granting licences to producers of GM crops proven to have no
2011 May
           negative effects on the environment. According to official sources the controversial technology can help addressing food shortage in
           the country. In Africa, cultivation of GM crops is already allowed in Egypt, Burkina Faso and South Africa.

           TANZANIA - edible oil production: Reportedly, the removal of import duties on vegetable oil in 2009 has made production of
           edible oil from locally grown seeds (mainly sunflowerseed) unprofitable. To correct this situation, the government recently decided
           to exempt oil manufacturers using home-grown seeds from paying VAT. Apparently, the move has resulted in a strong rise in the
2011 May
           demand for local oilseeds and, eventually, to acute shortages. The ensuing sharp increase in prices reportedly has forced most of the
           country‟s edible oil processors to suspend production. Eventually, the observed rise in prices and demand should act as a strong
           incentive for domestic oilcrop production.
           THAILAND - palm oil consumption policies: Shortage of palm cooking oil in the domestic market is reported to persist.
           Concerned about adverse effects on consumers, the government decided to indefinitely postpone the planned shift in mandatory
2011 May
           biodiesel blending from B3 to B5, and even ordered a cut in the mandate from B3 back to B2 during the months of March and April.

           THAILAND - soyoil retail price: At a meeting between the state committee overseeing product prices and edible oil
           manufacturers an agreement has been reached to raise the price for one-litre bottled soybean oil from Baht 46 to 55. The adjustment
           was made to reflect recent rises in production costs, in particular the higher cost of imported soybeans. The new retail price shall
2011 May
           remain in effect for at least three months. The manufacturers‟ original request for a stronger price hike was rejected as it would have
           posed too heavy a burden on consumers. Palm oil producers refrained from asking for similar upward adjustments, which leaves the
           retail price for palm oil at Baht 47.
           UNITED STATES - imports of substandard olive oil: According to study recently completed by a renowned university most
           olive oils imported into the US fail to meet the international criteria for “extra virgin olive oil” but still find their way to the
           retailers‟ shelves labelled as such and sold at a premium. While excellent imported and domestically produced olive oils are
2011 May
           available in the market, many of the country‟s top selling imported olive oils reportedly failed to pass the relevant chemical and
           sensory tests. In the US, demand for “extra virgin” olive oil has enjoyed steep growth rates in recent years and nearly 100% of olive
           oil consumed in the country is reported to come from imports.
           UNITED STATES - soyfoods market: Reportedly, sales of convenience foods made from whole soybeans or soy protein
           ingredients continued to experience strong growth even if the overall category has matured during recent years. Although the
2011 May
           soyfoods market faces a number of challenges, demand growth is forecast to continue in the near term thanks to positive market
           drivers such as further rising consumer interest in meat-free foods and revised federal nutrition guidelines.
            Investment in jatropha: Further investment in jatropha curcas as biodiesel feedstock is reported from South America. In Peru,
2011 May    Heaven Petroleum Operators SAC (allegedly the country‟s largest biofuel producer) has announced the development, over the next
            10 years, of 50 000 ha of jatropha in the southern, semi-arid region of Ica.
            Jatropha aviation fuel: A study prepared by a respected academic institution and funded by Boeing sees jatropha-based biodiesel
            as a potential substitute for traditional jet fuel. The report states that jatropha can deliver strong environmental and socioeconomic
2011 May    benefits as it is normally grown on land unsuitable for farming. According to the study jatropha fuel allows GHG emission
            reductions of up to 60% when compared petroleum-based jet fuel. Faced with constant rises in fuel prices and calls to become more
            environmentally responsible, civilian as well as military aviation have shown increased interest in jatropha fuel.
            Certified sustainable palm oil: RSPO decided to suspend the certification process for an important palm oil plantation in Malaysia
            until an on-going dispute with natives over plantation land is resolved. The company, which has been given a deadline for reaching
            an equitable solution over compensation issues, accepted the decision and is working closely with RSPO to find a solution fair
2011 May    towards all parties. Reportedly, this is the second time a company breaching RSPO principles is facing censure. The case is putting
            to test RSPO‟s capacity to implement voluntary dispute resolution mechanisms and sanctions that are acceptable to its entire
            membership. Meanwhile, consumer good manufacturer Unilever , which buys palm oil from the plantation company in question,
            said that it might review its buying position if the supplier failed to address the alleged violations.
            Lending framework for global oil palm development: After an 18-month moratorium on lending for new palm oil investment
            and extensive consultations with a wide range of stakeholders, the World Bank/IFC Group adopted a new framework and strategy
            for future engagement in the global palm oil sector. The Group recognizes the potential of palm oil production to contribute to
            poverty reduction - provided good environmental and social practices are followed - and hopes to make a contribution to
            strengthening the sectors‟ sustainability. Future lending by the Group will focus on four key areas: (i) regulatory and governance
2011 May
            reforms, (ii) responsible private investments, (iii) improved benefit sharing with smallholders and communities, and (iv)
            development and widespread adoption of environmentally and socially sustainable standards and codes of practice. Priority will be
            given to (a) institutional and market initiatives that support smallholders and foster benefit sharing with rural communities, and (b)
            initiatives that encourage production on degraded lands and seek to improve productivity of existing plantations.New screening and
            assessment procedures will also be introduced to enable appraisal of opportunities and risks around issues of land use and
            acquisition, governance, community concerns and working conditions. the country is set to become the first nation in Latin America
            ARGENTINA - trans fat regulation: According to industry sources,
            to limit the presence of trans fat in food products. Reportedly, under new legislation that is expected to come into force by mid-year,
2011 June
            trans fat content in vegetable oils and margarines will not be allowed to exceed 2% (not including trans fat naturally occurring in
            animal and dairy fat).
            ARGENTINA - soyoil exports to China: Reportedly, following Argentina‟s decision to definitively lift import restrictions on
            various consumer goods from China, Argentine exports of soyaoil to China have finally resumed. Such exports came to a virtual
2011 June
            standstill in April 2009, when China introduced very stringent quality requirements for imported soyaoil following Argentina‟s new
            import measures.
            ARGENTINA - biodiesel price: Private sources reported that, in order to stimulate domestic biodiesel producers to increase their
2011 June   sales to the national market, the government has raised the retail price of biodiesel to the equivalent of US$ 1 210 per tonne (from
            previously US$ 902).
            CHINA - public rapeseed stocks: The government is expected to soon start buying rapeseed (from the crop that is currently being
            harvested) to replenish state vegetable oil reserves. Reportedly, since last October, total release of rapeseed oil from government
2011 June   stocks amounted to about 1.8 million tons, bringing state reserves to below 1 million. The government is expected to pay Yuan 4
            600 per tonne of rapeseed - about 18 percent more than last year - to help improve farmers‟ income and to reflect increases in
            production costs.
            INDIA - oilseed production support: According to the Agriculture Ministry‟s Commission for Agricultural Costs and Prices, the
            government might offer higher procurement prices for monsoon-grown oilseeds. The move should compensate farmers for recent
2011 June
            rises in production costs and should help encouraging domestic oilseed production. In recent years, grains and rice have been
            accorded higher rises in procurement prices than oilseeds.
            INDONESIA - palm oil certification: Originally, scheduled to be launched in January this year, mandatory ISPO certification
            (Indonesian Sustainable Palm oil) is reported to be almost ready to start. The government is set to appoint an ISPO Commission that
            will manage the certification system and issue the required approvals to sustainably managed plantation companies. Initially, some
2011 June
            20 plantations will be selected for trials of the new certification. Reportedly, companies found to be breaking ISPO rules are going
            to be subject to sanctions. In the meantime, according to RSPO, the amount of Indonesian produce enjoying (internationally
            recognized, voluntary) RSPO certification has reached 1.2 million tons.
            LIBERIA - foreign oil palm investment: Two palm oil firms from, respectively, Malaysia and Singapore have been granted
            concessions to develop oil palm on a total of 420 000 ha. Although addressing primarily domestic food needs, in the longer term,
2011 June   the government is said to also eye export opportunities. Reportedly, social and environmental impact assessments will be
            undertaken before any development begins. Furthermore, the companies are committed to invest extensively in physical and social
            infrastructure and are expected to assist in the development of out-grower schemes involving smallholders.
            MALAYSIA-INDONESIA - cooperation on palm oil: Reportedly, the two countries jointly engaged in new efforts to defend the
            interests of their oil palm industries. Among other initiatives, the creation of a European Palm Oil Council has been announced. On
2011 June   the EU Directive on the Promotion of the Use of Renewable Sources (RED), the two countries reportedly agreed to seek legal
            advice as to the directive‟s consistency with WTO provisions. Concerns have also been voiced regarding the implications of a draft
            palm oil labelling bill that is under consideration in Australia (see MPPU May 2011 issue).
            UNITED KINGDOM - sustainable palm oil consumption: According to Proforest , an independent non-profit organization, the
            government of the United Kingdom is considering the introduction of specific policy interventions aimed at increasing the volume
2011 June   of sustainable palm oil consumed within the country‟s supply chain. In a report commissioned by the government, Proforest maps
            the structure of UK supply chains and uses of palm oil at each stage and reviews potential policy options along with the likely costs
            and benefits of each.
            Certified sustainable palm oil - sourcing policies: Global producer of household products SC Johnson has joined the list of
2011 June   companies committed to using exclusively palm oil originating from responsible and sustainable sources. The company expects to
            complete the transition to certified sustainable produce by 2015.
              Certified sustainable palm oil - global trade: Sources close to RSPO pointed out that currently only about half of the available
              certified palm oil actually enters trade as segregated produce. Although more and more end-users are keen to buy segregated
              produce, the fragmented nature of the industry and a very complex palm oil supply chain are said to prevent buyers from finding the
2011 June     quantities required. Reportedly, at this point, most end-users are forced to resort to buying certificates to back up their claims of
              sustainable sourcing. The certificate trading scheme offsets end- users‟ consumption against production of an equivalent amount of
              sustainable oil somewhere at source. Initially conceived as a stepping stone towards physically fully segregated supply chains,
              certificates could dominate trade in sustainable palm oil longer than originally envisaged.
              Hybrid jatropha seed: A US bioenergy firm informed that it has developed high performing hybrid seed of jatropha. The material
              is said to offer consistently high yields, uniformity and vigour and to reduce seed handling and deployment costs. Reportedly, the
2011 June     company has signed contracts for the deployment of 100 000 ha using hybrid seed and plans to develop a global pipeline totalling
              close to 0.5 million ha of jatropha projects worldwide. Plans include the adaptation of seed material to the specific growing
              conditions of individual customers.
              Biofuels and indirect land use changes: According to research conducted in the United States, the historic expansion of US
              biofuel production has in all probability not induced any indirect land use change. Allegedly, there have been no arable land
2011 June     increases, no damage to natural ecosystem lands and no significant crop expansion in foreign countries correlated to the past growth
              in US biofuels demand. These findings are in stark contrast to work carried out by other, public institutions on the likely impact of
              continued, future biofuel expansion.
              Exemption from EU countervailing duties on biodiesel: A Canadian renewable energy company reported that it has been
              exempted from EU duties applying to biodiesel imports from North America. Reportedly, the exemption is a result of the
2011 June
              company‟s full compliance with the EU‟s processes, including the submission of formal replies to questions and extensive
              collaboration with EU officials during a site visit.
              Soybean expansion in vulnerable ecosystems: A new report published by WWF highlights the impact that the global expansion
              of soybean cultivation has on sensitive environments such as the Brazilian Savannah, or Cerrado. Soybean related land conversions
              are said to have contributed to habitat destruction and increased CO2 emission. Therefore, the report calls on farmers, traders, food
2011 June
              companies and retailers to join multi-stakeholder schemes such as the Roundtable for Responsible Soy (RTRS), which sets strict
              environmental and social standards for soya production. RTRS sustainable certified soya is said to be available for the first time this
              year.
              ARGENTINA - soy export tax revenue: Taxes collected on soybean and derived product exports are estimated to amount to US$
2011 August   8 billion this year, up from 6.3 billion in 2010. Since mid 2008, soybean exports are subject to a 35% tax. The expected surge in
              revenues comes from the recent strength in international soybean prices.
              AUSTRALIA - draft palm oil labelling bill: The Australian Senate will likely reject a draft bill about compulsory labelling of
              palm oil in food products (see also MPPU no. 25, May 2011 ). Doubts have arisen as to whether the issues surrounding palm oil
2011 August   presence in foods justify an amendment of the existing labelling laws. Also, divisions became evident between industry bodies,
              consumer organizations and conservation groups. Furthermore, legislators also pointed to progress being made in the adoption of
              specific labelling under existing voluntary arrangements.
              CANADA – rapeseed marketing support: The Canola Council of Canada has been granted C$ 1.1 million under the
2011 August   government‟s AgriMarketing Program. The funds will be used to implement long-term international strategies focusing on foreign
              market development and consumer awareness as well as branding to highlight health and quality characteristics.
              CHINA - cooking oil inspections: Reportedly, to improve food safety, municipal health authorities in Beijing started conducting
2011 August   regular inspections of cooking oil used in restaurants. By verifying purchases and investigating supply channels the body aims to
              stop the use of illegal cooking oil.
              CHINA - retail price cap on edible oil: According to industry sources, the price cap on sales of edible oil introduced towards the
              end of last year with a view to counter food price inflation is still in place. Originally, price ceilings were supposed to be lifted by
              June. However, in May and June 2011, consumer price inflation has risen, respectively, 5.5% and 6.4% compared to the
              corresponding months of 2010, thus remaining historically very high. Private sources expect the price caps to remain in place until
2011 August
              mid August. Reportedly, the government decided to carry out an assessment of cooking oil stocks available in the country. Only if
              inventories were found to be sufficiently ample, price controls would be relaxed. Meanwhile, caught between retail price caps and
              rising crop prices, edible oil enterprises in Heilongjiang (the country‟s main soybean production base) are reported to be working
              way below installed capacity.
              CHINA - sales from state soybean reserves: According to latest estimates, during the 2010/11 marketing campaign, only 11-12
              thousand tons of soybeans were sold out of the over 3.8 million tons kept in public storage – despite regularly held auctions. The
2011 August
              poor result is attributed to unattractive floor prices as well as uncertainties among market participants about state trade policies and
              measures to direct domestic markets.
              CHINA - edible oil storage capacity: Quoting the State Administration of Grain, national press reported that the state‟s edible oil
              storage capacity has reached 14.08 million tons, which would correspond to about 40% of estimated annual domestic consumption.
2011 August
              If fully utilized, such capacity allows government market intervention to prevent cooking oil prices from surging when food
              inflation rises.
              CHINA - non-GMO soybean cultivation: The government is largely in favour of GM crop cultivation and has allowed the
              importation and domestic consumption of GM oilseeds and derived products. Domestic soybean cultivation, however, so far
2011 August
              remained free from GM varieties, thereby preserving its characteristic higher protein content. Now, the country‟s first officially
              GMO-free soybean growing area (measuring about 130 000 ha) has been established in Heilongjiang Province.
              CHINA - biodiesel standard: Two national standards defining the quality of specific biodiesel blends have been issued in the last
              few years. Now a complete trade standard for biodiesel has been officially launched. It is expected to comprehensively regulate the
              country‟s biodiesel industry. Production, distribution and sales of biodiesel will be regulated in detail. The standard includes
2011 August   mandatory waste treatment and by-product recycling. Reportedly, a biodiesel company that already produces according to the
              standard said that it expects better client confidence and increased sales. Currently, the country‟s sales of biodiesel as transportation
              fuel are reported to be minimal due to small profit margins. So far, biodiesel use (B5 blends) is mandatory only in Hainan Province.
              EUROPEAN UNION - biofuel sustainability certification: Starting this year, in order to count towards the EU's renewable
              energy targets, utilization of biofuel - whether of domestic or imported origin - requires proof of sustainable production methods.
              The first seven voluntary certification schemes have just been approved by the European Commission, namely (i) ISCC, a German
              government-funded scheme covering all types of biofuels; (ii) Bonsucro-EU, a scheme focused on sugarcane-based biofuels in
2011 August   Brazil; (iii) RTRS-EU-RED, an initiative for soy-based biofuels in Argentina and Brazil; (iv) RSB-EU-RED, a scheme covering
              all forms of biofuels; (v) 2BSvs, a French industry initiative covering all types of biofuels; (vi) RSBA, a scheme developed by
              biofuel producer Abengoa to cover its supply chain; and (vii) a programme from biofuel producer Greenenergy covering sugar
              cane ethanol from Brazil. A number of civil society groups have questioned the schemes‟ ability to objectively demonstrate
              sustainability in biofuel production.
              EUROPEAN UNION - aviation biofuel initiative: A stakeholder group bringing together the European Commission, biofuel
              producers and airline companies has launched Biofuel Flightpath, an industry wide initiative aimed at speeding up the
              commercialization of renewable, sustainably produced aviation fuel in Europe. The stakeholders‟ ultimate objective is to reduce air
              transport‟s carbon footprint. The technical suitability of various biofuels for jet engines has been extensively tested. The European
2011 August
              Commission sees the initiative as an opportunity to create the first industrial venture introducing biofuels for commercially
              competitive operations. Reportedly, group members have agreed to a target of 2 million tons of aviation biofuel produced and
              consumed annually by 2020. The fuel is expected to be produced in the EU from European sourced feedstock material.

              INDIA - oilseed production support: The government has approved a 17.4% increase in the minimum support prices for kharif
              (summer) oilcrops: the new prices for yellow soybean and for groundnut are, respectively, Rp 16500/t and Rp 27000/t (which
              compares to Rp 14000/t and Rp 23000/t last year). Support prices, which are used to protect farm incomes in case market prices
              crash, are revised regularly to reflect rises in production costs. However, with this year‟s unusually high increase, the government is
2011 August
              also seeking to encourage oilseed production, thereby reducing the country‟s large edible oil deficit. The support price for rice,
              where government stocks are currently reported to widely exceed target levels, has only been raised by about 8%. Local observers
              have expressed concern that the hike in support prices could push up food prices, thus adding to inflationary pressure.

              INDONESIA - palm oil export tax: Following the recent drop in international quotations, the export tax on crude palm oil and its
              derivatives will be lowered to 15% in August, compared 20% applied in July. Reportedly, the government is also considering to
2011 August   lower the upper limit in the country‟s progressive export taxation system to 20%, compared to 25% at present. The bottom rate of
              the sliding tax would remain unchanged at 1.5%. The reason provided for the proposed adjustment is that the levy failed to spur
              local processing of palm oil into downstream products as originally envisaged.
              INDONESIA - ban on forest and peatland conversion: Since the nation-wide 2-year moratorium on forest clearing and peatland
              conversion has come into effect last May (see also MPPU no. 17, August 2010 ), expansion activities by Indonesian and Malaysian
2011 August   oil palm firms in Borneo Island seem to have come under greater scrutiny. In particular, a recently published list of exemptions to
              the moratorium has attracted the attention of environmental groups. In point of fact, those concessions and licenses that were
              granted before the new law became effective are exempted from the moratorium.
              INDONESIA - palm oil certification: Mandatory certification according to the newly launched ISPO environmental standard (see
              also MPPU no. 20 & 26) is officially expected to start no later than August. Announced in November of last year, the initiative has
              been slow to take off. Reportedly, the government and the main stakeholders of the palm oil value chain still need to agree on the
2011 August
              composition and operations of an ISPO commission and secretariat. However, a dozen independent auditors have already been
              officially appointed and given the green light to start the certification process. The auditing exercise is expected to require about 1-2
              months per oil palm firm.
              MALAYSIA/INDONESIA - oil palm plantation workers: In oil palm, harvesting remains predominantly manual and is difficult
              to mechanise. Over the last years, a chronic shortage of workers has developed in Malaysian oil palm plantations, where 80% of the
              labour force comes from abroad, mostly Indonesia. Reportedly, strict entry requirements and work permit rules together with better
              job opportunities in Indonesia have lead to a drop in foreign worker arrivals in Malaysia. Plantation companies report that the
2011 August
              reduction in labour force has negatively affected productivity (and profit margins) as they are forces to increase the intervals
              between harvests. The lack of labourers also led to higher wages, thus pushing up production costs. In Indonesia, where oil palm
              continues to expand strongly, demand for labour is high and wages have become increasingly attractive. As a result, competition
              between the two countries to retain labour force has increased sharply in recent years.
              MOZAMBIQUE - biodiesel policy: Private sources reported that the government passed into law a regulation mandating
2011 August   nationwide use of B3 blends by the year 2012. The development of a domestic biofuel market has been promoted since 2009 and a
              considerable number of biofuel projects have been established in the country during the last few years.
              PAKISTAN - domestic marketing control: Investigations on the violation of competition principles have resulted in the
2011 August   government directing the national association of ghee and cooking oil manufacturers to refrain from all activities related to costing
              and pricing of commodities marketed by its members.
              RUSSIAN FEDERATION/BELARUS /KAZAKHSTAN - import policy: The three-country customs union has decided to
2011 August   temporarily suspend its 5% soymeal import tariff during June and July 2011 as feed grain shortages have developed among member
              countries.
              UKRAINE - export policy: Since 2000, the following export control measures have been introduced for sunflowerseed and its oil:
              seed exports have been taxed at rates ranging 11-23%, and both, seed and oil shipments were subject to temporary quotas.
              According to private sources, concerned about domestic supply shortages, rising prices and high inflation, soon the government will
2011 August
              also introduce export duties on sunflower oil (10% or not less than € 90/t), rapeseed (11% or € 53/t) and soybeans (8% or € 30/t).
              By contrast, the existing export tax on sunflower seed could be lifted. For grains, new export duties have come into force last July.

              UNITED ARAB EMIRATES - recycled vegetable oil: The government has entered a partnership with McDonald‟s Restaurants
              to produce biodiesel based on recycled cooking oil. The country‟s first licensed biodiesel plant will have an annual output capacity
2011 August
              of one million litres. Used oil will be converted into 100% biodiesel on a one-to-one basis. McDonald‟s committed to using the
              biodiesel in its logistic fleet to achieve a reduction in its carbon footprint.
              UNITED STATES - support to camelina production: Domestic production of camelina sativa is expected to expand thanks to a
              new joint private-public program. The oilseed will be produced as feedstock for aviation fuel, biodiesel and speciality chemicals.
2011 August   Farmers participating in the program will receive production subsidies for up to five years. Reportedly, camelina-based jet fuel has
              been widely tested and could become the bio-based fuel of choice for both military and commercial customers. It meets the relevant,
              recently approved ASTM fuel specification.
              UNITED STATES - climate change adaptation: The government started providing funds for research that will assist soybean
              (and maize) farmers to modify farming techniques that help dealing with climate change. To increase resilience against more
2011 August
              variable and extreme climate patterns in the future research efforts will focus on creating conditions that enable rapid crop growth
              while also enhancing soil characteristics that enable soils to handle spikes in rainfall and temperature.
              UNITED STATES - agricultural policy simulation: FAPRI Institute (University of Missouri), which provides financial analysis
              to the U.S. Congress on proposed policy changes, has conducted a study on the potential impact of eliminating direct support
2011 August   payments to farmers. Reportedly, while cutting the payments would reduce federal budget outlays under that programme, the
              measure will likely boost farmer participation in the public income safety net programme ACRE, thus offsetting much of the budget
              savings.
              VENEZUELA - producer support prices: In August 2011, a 30% increase in the farm gate prices set by the government for
2011 August
              soybeans, rice and maize should come into effect.
              Certified sustainable palm oil - Supply: Global production of RSPO certified palm oil is reported to grow rapidly. According to
              industry estimates, currently about 9% of global palm oil output is being certified. Reportedly, today about 5 million tons undergo
2011 August   certification – compared to only 1 million tons in 2009. Around 54% of all certified produce originates from Malaysia, followed by
              Indonesia with 35%. A big company that runs plantations in both Malaysia and Indonesia informed that its production of certified
              palm and palm kernel oil has reached 1.5 million tons and is set grow to 3 million tons by 2015.
              Certified sustainable palm oil - Industry sourcing: Cargill is committed to source 100% of the palm oil products it trades from
              RSPO certified sustainable sources by 2020. Currently, about 70% of the palm oil traded comes from certified sources. The
              company‟s supplies to customers in Europe, the US, Canada, Australia and New Zealand will be fully certified already by 2015.
              This plan is supposed to help the company to meet the rising demand for sustainable produce amongst manufacturers and retailers.
2011 August
              At the same time palm oil producers will be encouraged to adopt more sustainable practices. The company actively assists
              producers in the adoption of sustainable practices and specifically helps smallholders to understand the RSPO criteria. Reportedly,
              smallholders at a Cargill-owned plantation in Indonesia recently started selling certified palm oil at a premium. Other benefits
              reaped by the farmers are said to include increased crop productivity and enhanced operational efficiency.
              Biofuel feedstock preferences: Global producer and supplier of certified sustainable biofuels Neste Oil reported the following
              shifts in its raw material procurement: crude palm oil now accounts for no more than 50% of total feedstock, while the proportion of
2011 August   waste animal fat and by-products form vegetable oil refining has grown to 40%. Furthermore, the feedstock base has been expanded
              by adding jatropha and camelina oil. The company also conducts research on soybean oil, waste fish oil, used cooking oil, tall oil
              and entirely new materials (such as algae) continues.
                 New functional oils - Clear Valley 80 Canola Oil: A new high oleic rapeseed oil has been launched by Cargill. The oil is
                 reported to deliver high nutritional and health benefits thanks to its low level of saturated fat and minimal presence of trans fat.
2011 August
                 High in oleic acid content, the oil features increased heat and oxidative stability without going through hydrogenation, fractionation
                 and other complex processing, thus offering extended shelf life and the related cost advantages.
                 New functional oils: - Omega-9 Sunflower Oil: Dow AgroSciences has developed a new sunflower oil to address increasing
                 customer demand for healthier products. Reportedly, the new product is free of saturated fat, has zero trans fat and is characterized
2011 August
                 by a high content of monounsaturated fats. Thanks to a high level of stability, formulations using the oil do not require antioxidants
                 or partial hydrogenation and enjoy a high shelf life
                 Conversion of palm oil mills: A number of palm oil processors in Malaysia and Indonesia engaged in efforts to convert their
                 conventional mills into “green” ones via the full exploitation of waste products. The conversion includes the production (and
2011 August      commercial sales) of dry long fibre pellets and the breaking-up of palm oil mill effluent along with the corresponding energy
                 extraction, which reduces waste treatment costs. The cost of converting a 60t FFB/hour mill is reported to amount to US$ 10
                 million, with an alleged payback period of only 3-4 years thanks to the associated cash returns.
                 Certified sustainable soy: Certification and trading of sustainable soy has been launched by RTRS, the Round Table on
                 Responsible Soy Association. RTRS brings together stakeholders of the entire soy value chain, including several civil society
                 organizations. Certification requires compliance with the following five principles: (i) good business practices and legal
                 compliance; (ii) responsible labour conditions; (iii) responsible community relations; (iv) environmental responsibility; and (v)
                 good agricultural practices. Producers in Brazil and Argentina have already applied for certification. To facilitate trade, RTRS also
2011 August
                 launched a certificate trading platform under which soybean producers receive rewards for delivery of certified produce. First
                 purchases of soybean and soyoil certificates have been reported by Unilever Brazil and the Dutch feed and food industry. The
                 Association expects to certify 0.5 million tons of soybean this year and double that amount during 2012. Producers using RTRS
                 certification also have the option to include a biofuel annex to the auditing process, which provides them access to the EU biofuel
                 market, where RTRS certification enjoys official recognition.
                 Revised international aviation fuel standard: The globally recognized standards development and delivery organization ASTM
                 International has revised its specification for aviation fuel to enhance blending with renewable fuels. Under the new provisions
                 included in ASTM-D7566, up to 50% of bioderived synthetic blending components can be added to conventional jet fuel. These
                 components, called hydroprocessed esters and fatty acids (HEFA), can be derived from vegetable oil-containing feedstock (such as
2011 August
                 jatropha, camelina and algae) or animal fats. Where the new standard is applied, blended jet fuel can be considered identical to
                 conventional fuel and does not differ in performance and operability. The revision of the existing standard is the result of an
                 industry-wide cooperative effort which reflects the aviation sector‟s search for sustainable, environmentally friendly forms of
                 operation that also enhance energy supply security and competitiveness.
                 BRAZIL - GM soybean: Private sources estimate the share of GMO soy in total soybean sowings to reach 83% in the
                 forthcoming 2011/12 season. Compared to last season, the area planted with approved transgenic varieties is expected to rise by
2011 September
                 over 13%. Reportedly, the Centre-West growing states could, for the first time, surpass the Southern Region in terms of area
                 allocated to GM soybean. The main traits present in the GM varieties used are herbicide tolerance and insect resistance.
                 CANADA - trans fat regulations: In 2006, the country‟s health authorities introduced measures aimed at reducing the level of
                 trans fats in food products (without increasing the levels of saturated fats). A target level of maximum 2% of trans fat in the fat
                 content of vegetable oils and spreadable margarines and of 5% in all other foods was set. The indication of the trans fat content in
                 pre-packaged food was made mandatory, and the industry agreed to work toward voluntary limits in the trans fat content of food
2011 September
                 products. Should insufficient progress be noted in reaching the set targets, legislation for compulsory trans fat reduction was to be
                 considered. Eventually, a report issued in late 2009 revealed limited progress in achieving the reduction targets. Reportedly,
                 analyses are still underway to understand why the industry cannot meet the set objectives. Food companies are said to face a
                 number of technical challenges preventing them from meeting the targets.
                 CHINA - state soybean reserves: Government efforts to release soybean onto the market are set to continue. Reportedly, auctions
                 from state reserves amounting to 4 million tons are planned, with a view to prevent price rises before the expected seasonal peaks in
2011 September
                 demand. The auction starting price could be set at RMB 3,500 per ton. Past auctions at the same price level have produced only
                 limited sales.
                 EUROPEAN UNION - energy tax: According to industry sources, the proposed changes to the EU energy taxation directive (see
                 MPPU no. 25, May 2011) would be beneficial for the renewable energy sector. Reportedly, the proposed revision would end the
                 current, contradictory discrimination of renewable fuels because (i) biofuels have a lower energy density than fossil fuels, and (ii)
2011 September
                 bioenergy is generally acknowledged to be carbon dioxide free at the end use. Furthermore, under the proposal, the taxation of
                 diesel and petrol would be fully aligned, which should put an end to past distortions that tended to favour diesel as a transport fuel.

                 INDIA - government imports of edible oil: Reportedly, the government intends to extend its edible oils import programme for
                 public distribution at subsidized prices, which is due to expire in September 2011, until September 2012. Up to 1 million tons
2011 September
                 would be imported and distributed by state-run trading agencies. Private sources estimate that the subsidized sales to poor
                 households since 2008 have contributed to the rise in overall domestic consumption in recent years.
                 INDIA - hybrid jatropha for biodiesel production: Reportedly, the private sector has launched a crop development programme
                 involving molecular breeding and biotechnology to produce high-yielding varieties adapted to the country‟s specific agronomic
                 conditions. Eventually, the initiative envisages the deployment of 35,000 ha with high-performing jatropha hybrids. Since 2009,
2011 September   India has a national policy on biofuels that aims at an ambitious 20% diesel blending rate. The government called for the use of
                 wasteland to cultivate non-edible oilcrops such as jatropha. It has set biodiesel procurement prices, which however are reported not
                 to be remunerative enough for the industry to grow. No form of financial assistance is provided to the growers or processors.

                 INDONESIA - palm oil export tax - September tax rate: With international palm oil prices about unchanged in August, the
2011 September
                 export tax on crude palm oil will remain at 15% during September.
                 INDONESIA - palm oil export tax - Modified taxation scheme: A modified palm oil taxation system is going to come into
                 effect in October. While progressive taxation based on world market prices is going to remain in place, the min./max. tax range will
                 be narrowed to 7.5-22.5 percent for crude palm oil and 7.5-13 for refined oil – compared to the current, common band of 1.5-25
                 percent. Furthermore, in addition to quotations in Rotterdam, prices form commodity exchanges in Malaysia and Indonesia will be
                 used to calculate the international reference price. But the key change is the preferential treatment - i.e. lower tax cap - accorded to
2011 September
                 refined oil relative to crude oil exports, which, according to market observes, denotes renewed efforts by the government to promote
                 domestic processing and value addition in palm oil. In fact, trade data reveal a drop, over recent years, in the share of refined oil
                 palm products in total shipments (to less than 50%). Assuming Indonesia‟s future shipments of processed palm oil rise as a result of
                 the new tax rates, competing exporters (in particular Malaysia) as well as buyers of Indonesian oil palm products could be adversely
                 affected. Malaysia, where refined product shipments account for over 80% of total exports, could be exposed to increased
                 competition considering that Indonesian refiners enjoy government decided to allocate, through the country‟s Palm OilconsiderRM
                 MALAYSIA - smallholder support: Reportedly, the significantly lower production costs. Therefore, Malaysia may Board,
                 7,000 per ha to small farmers for them to participate in the replanting and new planting of oil palms and thus contribute to the
2011 September
                 expansion of domestic production. The programme is targeted at some 300,000 smallholders that cultivate about 650,000 ha of land.

                 PARAGUAY - export taxation proposal: Reportedly, the country‟s Senate is considering a bill to tax the exportation of
                 soybeans (as well as of maize and sunflower seed). An ad valorem duty of 6% is being proposed to raise the agricultural sector‟s
                 contribution to the state budget and thus public expenditure. Soy production has expanded sharply in recent years, turning the
2011 September
                 country into the world‟s fourth-biggest supplier (as about 70% of domestic production going into export). Allegedly, the sector‟s
                 growth has played a prominent role in the country‟s recent overall economic expansion – without a commensurate fiscal
                 contribution.
                 PHILIPPINES - coconut export growth: The country‟s exports of coconut products have been consistently rising over the last
                 few years. According to industry sources, growth was concentrated in markets where the country enjoys free trade agreements
                 (FTAs). Apparently, exporters have taken advantage of preferential agreements negotiated with selected countries. Reportedly, the
2011 September
                 reduction or gradual elimination of tariffs has improved marked access in Indonesia, Malaysia and Thailand. In 2010, three-fourths
                 of Philippine coconut export revenues are said to have come from markets covered by FTAs, namely the ASEAN bloc, China, the
                 Rep. of Korea, Japan, Australia and New Zealand.
                 UNITED STATES - biodiesel production - Domestic output: According to industry estimates, 2011 domestic biodiesel
                 production should reach at least 750 million gallons, which compares to a mandatory consumption level of 800 million gallons. The
                 anticipated recovery in production from last year (315 million gallons) comes following the reinstatement of the biodiesel tax credit
2011 September   earlier this year. According to private sources, EPA recently tabled a proposal that increases mandatory use for next year from the
                 currently agreed level of 1.0 billion to 1.25 billion gallons. The country‟s total installed production capacity is estimated at close to
                 3 billion gallons. The federal tax credit is scheduled to expire in December this year. Reportedly, a draft bill for extending the
                 incentive for three more years has already been tabled.
                 UNITED STATES - biodiesel production - Energy balance: According to new research conducted with USDA participation,
                 the energy balance (or fossil energy ratio) of biodiesel is 5.5, i.e. for every unit of fossil energy required to produce biodiesel (from
2011 September   soybean oil), the return is 5.5 units of renewable energy. Reportedly, the ratio has improved compared to a few years back, allegedly
                 because (i) soybean farmers have increasingly adopted energy-saving practices such as zero tillage, (ii) yield levels have increased,
                 and (iii) soy crushing plants and biodiesel production units have become more energy efficient.
                 Specialty oilseed crop - high erucic acid rapeseed (HEAR): Following several years of trial work, full-scale commercial
                 production of HEAR is expected to start in the 2011/12 season in North Carolina, United States. As a high-value specialty crop,
                 HEAR has a particular fatty acid composition which makes it suitable for multiple end-use applications, especially non-food
2011 September
                 industrial uses. HEAR will be grown under contract only, with two private enterprises providing the seed and agronomic advisory
                 services, purchasing the entire crop, and taking care of storage and processing. HEAR is a winter crop and is said to offer
                 advantages with regard to crop rotation.
                 Certified sustainable palm oil - RSPO certification: Three years after its launch, RSPO certification is now reported to involve a
                 production area of 1 million ha word-wide, concerning close to 5 million tons of palm oil or about 10% of global output. The 1
2011 September   million ha mark has been reached through the certification of the supply base and mills of a major Brazilian producer, supposedly
                 demonstrating the feasibility of oil palm cultivation in the Brazilian Amazon region - in a manner compatible with sound
                 environmental and social standards.
                 Certified sustainable palm oil - national certification scheme: Following the footsteps of Indonesia, the Malaysian government
                 reportedly started planning a national certification scheme - independent from voluntary RSPO certification (which is currently
                 used by producers to certify about 17% of domestic output). Reportedly, the government does not fully support the RSPO scheme
2011 September
                 which is said to be subject to revisions and not to provide the type of service the market requires. Under the planned national
                 system, buyers will be offered direct, physical access to certified palm oil, with due attention to all the concerns raised by the trade.
                 Furthermore, small producers would not face any disadvantages in obtaining certification.
                 Soybean seed development: Five of the world‟s leading international seed breeding companies are said to be working on a range
                 of far-reaching varietal improvements for soybeans that are expected to reach the commercialization stage during the present
2011 September
                 decade. Reportedly, various new varieties with multiple traits are being developed via genetic modification, to combine herbicide
                 resistance, disease tolerance and special fatty-acid composition.
                 Certified sustainable soy: Global crop processing and trading company ADM reported to have obtained ISCC certification for soy
                 grown in South America and destined for the EU biodiesel market. ISCC (International Sustainability and Carbon Certification)
2011 September
                 fully meets EU-RED requirements. ADM informed that although its initiative is driven by the biofuels market, the company also
                 anticipates a growing need for sustainable soy in the food and feed markets.
                 Reducing trans fats in bakery goods: According to research conducted in India, it is possible to replace hydrogenated fat (rich in
                 trans fatty acid) in bakery products with sunflower and coconut oil: when other ingredients such as emulsifiers and hydrocolloids
2011 September
                 are added, the quality characteristics typically imparted by shortenings will not be lost, while the content of polyunsaturated fat will
                 also rise significantly.
               AUSTRALIA - draft palm oil labelling bill (see also MPPU no. 25&27, May& Aug. 2011) : Reportedly, although the concerned
               Parliament committee recommended not to pass the draft bill on labelling standards for food products that contain palm oil, the
               Senate opted to go ahead, submitting the bill to the House of Representatives. Meanwhile the bill has also been expanded to apply
2011 October
               to any food as well as non-food product containing palm oil or its sub-products. Malaysia‟s industry (which provides virtually all of
               Australia‟s palm oil) responded with a second appeal to the Parliament explaining that the draft law was based on misleading claims
               and the bill presented an indirect trade barrier violating international trade rules.
               BRAZIL - domestic soybean transportation: Future expansion of soybean cultivation in the state of Mato Grosso, the country‟s
               leading growth area, will strongly depend on the ability to reduce transportation costs (and on continued conversion of pasture land
               combined with greater use of feedlots). Estimated at around USD 110-120 per tonne, the current cost of shipping soybeans - mostly
               by road - from Mato Grosso to the major ports located in the South of the country accounts for up to 25% of the product‟s value,
               compared to less than 10 % on average in the United States. That burden can only be reduced by improving the country‟s
2011 October
               waterways and railroad network. In this regard, the Ferronorte railroad project is expected to bring about major gains as it will link
               Cuiabà, Mato Grosso‟s capital, to the southern state of São Paulo. Under construction since 1992, the railway is expected to reach
               Rondonópolis (200 km before Cuiabà) in 2012. For the medium and longer term, further extensions towards the North and
               Northwest are also planned so as to link Mato Grosso to ports located in the Amazon River bay.

               CHINA - state soybean reserves: Private sources expect major sales of soybeans from state reserves over the next few months as
               the government is keen to free storage space for bean purchases from the new crop and for expanding edible oil reserves. Public
2011 October   soybean reserves are unofficially estimated to have swollen to close to 5 million tonnes. Reportedly, to stimulate purchases,
               processors will be offered subsidies to crush soybeans, with the oil going back into state reserves, while the meal will be sold on the
               market.
               EUROPEAN UNION - sustainable biofuel production: Earlier expected for end 2011, the release by the European Commission
               of guidelines on the influence of indirect land use changes (ILUC) on carbon savings in biofuel production and utilization seems to
               have been postponed by 6 or 7 more years because scientific uncertainties persist. The ILUC concept attempts to measure the effects
               of local production of a particular biofuel feedstock on global food crop production and GHG emission levels. Reportedly, the idea
               is to delay feedstock specific rules on ILUC in favour of an indirect approach that will affect all biofuel crops equally, namely an
2011 October
               increase in the emission savings threshold that all biofuels must meet in order to count towards the bloc‟s bioenergy targets (thereby
               gaining access to various preferential treatments). Originally set at 35% (emission savings compared to fossil fuel) from 2013 and
               50% after 2017, the 2013 threshold could be revised upward to 45-50%. While providing some relief to the EU biofuel industry,
               the new policy would be meant to help phase out the worst performing biofuels and prevent further investments in biofuel
               production systems with low levels of sustainability.
               EUROPEAN UNION - olive oil storage aid: Olive oil prices in the EU have dropped below the threshold that triggers support
               payments for private storage. Hence, the Commission decided to grant assistance for a total of 100 000 tonnes, with storage time
2011 October
               limited to six months. The measures is meant to help the sector address short term marketing problems, without affecting the market
               at the start of the new (2012/13) season.
               INDIA - import duty on refined palm oil: In response to Indonesia‟s restructured export tax (which is expected to boost the
               nation‟s shipment of refined oil possibly making it unprofitable for importing countries to buy crude palm oil for local processing),
               India‟s processing industry is urging policy makers to raise the country‟s import duty on refined palm oil from currently 7.5% to at
               least 15%. At present, close to 80% of the country‟s edible oil requirements are covered by imports of crude palm oil, which
2011 October
               subsequently gets refined locally. However, at the current tariff levels and with reduced prices for processed products coming from
               Indonesia, India‟s imports of refined palm oil are likely to rise sharply, thus hurting the country‟s refining industry. Already, the
               country‟s annual refining capacity is currently estimated to be utilized to only 60%. Reportedly, the country‟s Food Ministry is
               backing the industry‟s request and has taken up the matter with the Finance Ministry.
               INDIA - oilmeal export policy: In the past, the domestic market for animal feed offered limited opportunities for local producers
               of oilmeal. As a result, export opportunities were explored and recently the country succeeded in becoming a reliable and
               competitive supplier of oilmeals to the Asian market. Temporary policy measures introduced to facilitate meal exportation
2011 October   contributed to this development. Now foreign sales have risen to a point where, concerned about shortages on the domestic feed
               market, the country‟s dairy and poultry industry is calling for policy measures to check exports of locally produced oilmeals.
               Although the country‟s Food Ministry seems to rule out industry calls for a ban on oilmeal exports, it is said to support a proposal
               to double the export tax on oilmeals, which currently stands at 10%.
               INDIA - overseas farm land acquisition: According to unofficial sources the government is working on policies that will allow
               Indian agribusiness companies to buy land abroad for growing various crops, including oil palm. Reportedly, large tracts of
               uncultivated land, especially in Latin America and Africa, could be earmarked. Given India‟s rising population and related food
2011 October   security concerns, policy makers are looking into means to encourage outsourcing of domestic food production, recognizing that, in
               the longer term, securing food supplies alone via the introduction - at national level - of yield improving technologies and better
               irrigation facilities could prove challenging. Also the vulnerability of domestic agriculture to adverse weather conditions seems to
               be of concern.
               INDONESIA - palm oil export tax: After its recent decision to modify the upper and lower limits for the export duty on crude and
               refined palm oil (driven by the objective to stimulate shipments of processed products), the government has decided to adjust the
2011 October
               actual level of the tax for processed palm oil from 15% to 8%, while increasing the rate for crude oil from 15% to 16.5% - a tax
               structure that clearly favours shipments of refined products. The new rates will come into effect on 1st October.
               INDONESIA / PAKISTAN - palm oil trade: The recently signed preferential trade agreement between the two countries is
               expected to restore Pakistan‟s imports of Indonesian palm oil to their traditional level. Over the last few years, purchases from
               Indonesia had shrunk in favour of imports from Malaysia, which in November 2007 sealed a free trade agreement with Pakistan.
2011 October
               Under the new trade pact, Pakistan will cut its import duty on Indonesian crude and refined palm oil by 15%, thus granting the
               same treatment it applies to imports from Malaysia. The new agreement will come into force next January, after more than six years
               of negotiation. Reportedly, until 2007, Pakistan sourced 55% of its palm oil imports from Indonesia.
               MALAYSIA - oil palm seed cost: Reportedly, the private industry is set to increase the price for germinated seed by 30% from
               January next year. Behind the rise are (i) heavy investments in past years into breeding for higher yields and (ii) rising production
2011 October
               costs, due in particular to increases in minimum labour wages and foreign worker levies as well as higher fertilizer costs and
               electricity tariffs affecting production costs in plantations and processing plants.
               MALAYSIA - possible assistance to palm oil refiners: Indonesia‟s recent restructuring of palm oil export taxes was bound to
               affects its main competitor in the export market, Malaysia. The country, which over the years succeeded in exporting most of its
               palm oil in refined form, is destined to see profits in the production and exportation of refined produce falling as a result of
               Indonesia‟s tax adjustment. Experts estimated the new price advantage enjoyed by Indonesian competitors at USD 70 to 130 per
               tonne of refined palm oil. As under current conditions reducing costs by such amounts may well be unattainable for Malaysian
2011 October
               refiners, the government seems to be under pressure to consider measures to support the industry. Industry experts listed the
               following options for possible government intervention, all aimed either at increasing domestic palm oil supplies or at lowering the
               domestic price for crude palm oil: (i) the gradual reduction (or abolition) of the existing tax-free export quota for crude palm oil; (ii)
               the reduction (or removal) of windfall taxes that were imposed on oil palm plantations in a period of rising profits; (iii) the
               introduction of tax rebates for the downstream industry; and (iv) setting domestic price ceilings for crude palm oil.
               MALAYSIA - conversion of palm oil mills (see also MPPU no. 27, Aug. 2011) : In Malaysia, the notion of converting
               conventional mills into “green” ones via the full exploitation of waste products will be the objective of a newly formed public-
2011 October   private partnership (between Sime Darby Foundation and Universiti Kebangsaan). The aim is to turn the waste products of the
               milling process (estimated at more than 80 million tonnes of biomass per year at country level) into bio-fertilizer, animal feed and
               bio-fuel for commercial use.
               UNITED STATES - rapeseed oil-based biofuel: After determining last year that rapeseed oil-biodiesel meets the country‟s
2011 October   requirements for biomass-based diesel, the EPA has officially approved the use of Canadian rapeseed oil in US biodiesel production
               and consumption. The decision opens the US market to imports of biofuel feedstock or biofuel from Canada.
               UNITED STATES / EUROPEAN UNION - GHG footprint of soyoil-based biodiesel: Reportedly, the US soy industry
               requested the European Commission to set the emission reduction value for soybean-based biodiesel produced in the United States
               at 58% (relative to fossil fuel) as opposed to the default value of 31% currently applied to all soy-biodiesel consumed in the EU.
               The industry claims that the EU‟s lower value is based solely on Brazilian production and utilization data and therefore should not
2011 October
               be used for biofuel produced in the US. The value is important because from 2013 the minimum emission saving required for all
               biodiesel consumed in the EU will be 35% (in order to count towards the EU‟s renewable energy targets). Although EU biodiesel
               consumption relies strongly on EU-grown rapeseed, the bloc also consumes biodiesel derived from oilseeds grown overseas, such as
               soybean produced in the US, Brazil and Argentina.
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2010 May
Argentina - export taxation: In Argentina, export taxes on wheat and maize
have been lowered by, respectively, 18 and 20 percent. By contrast, the duties for
oilseeds and their products remained unchanged. From 4 December, the following
base export duties apply to grains (in percent, ad valorem): wheat 23, maize 20,
soybeans 35, sunflowerseed 32.
India - oil import duties: Reportedly, India has decided not to re-introduce
duties on the importation of crude edible oils (notably palm oil) for the time being -
 in spite of the recent price falls in the international and domestic oilseed and oil
markets. When prices started to surge in 2007, hitting domestic consumers, import
duties were lowered and then suspended altogether. Reportedly, import duties will
only be re-imposed if domestic oilseed prices drop below the currently applied
official minimum support prices for farmers. The only exception is crude soy oil,
for which a 20 percent import duty has been reinstated in November.
Paraguay - land use policy: Reportedly, in an effort to calm current protests
against foreigners owing large tracts of land - in particular of soybean farms - the
government is considering to enforce a long-standing law that does not allow
foreigners to buy agricultural land from citizens.
Ukraine - domestic price regulation: With a view to counter the marked fall in
domestic prices of sunflowerseed, according to unofficial sources, the government
has taken steps to add sunlflowerseed to the list of products whose prices are
regulated by the state. Such measure will be limited to the 2008/09 marketing
season. The official price band has yet to be announced.
Ukraine - export policy: Reportedly, in response to falling international prices
and deteriorating export prospects, export duties on sunflowerseed could be
suspended during the current marketing season. At the same time, the introduction
of export quotas might be required to ensure adequate coverage of domestic
consumption needs. Export quotas could amount to 1.2 to 2 million tons and might
be allocated primarily to traders that purchase sunflowerseed at the official
minimum price.
EU - common agricultural policy: The recently completed review of the
European Union‟s agrarian policies (“Health Check”) carries no major, direct
implications for oilseed crops. The only relevant measure is the abolishment (in
2010) of the energy crop premium of € 45/ha, which applies to rapeseed grown for
biodiesel production. Other changes applying to arable crops in general include:
the permanent abolition of compulsory land set aside (from 2009); the full
decoupling (in 2010) of production payments; rules regarding minimum and
maximum payments to individual farmers; the diversion of some direct farmer
payments to rural development projects; the simplification and update of cross
compliance requirements concerning cultivation practices and related
environmental aspects.
EU - GMO approval: Approval for the importation, marketing and use in food
and animal feed across the 27 nation market has been granted for a GMO soybean
known as second generation Roundup Ready Soybean. The new variety started to
be grown in North America and the approval by the EU - an important buyer of
USA grown soybeans - was eagerly awaited by the industry on both sides of the
Atlantic. The permission is valid for 10 years and the bean (and any product
derived from it) will be subject to the EU‟s strict labelling and traceability
requirements. The next GM product in line for potential approval is a new variety
of rapeseed that has been developed and is already cultivated in Canada.

Malaysia/Indonesia - supply control measures: Reportedly, the two countries
agreed to take coordinated action to address the current slide in palm oil prices and
the slow down in demand for palm oil anticipated for next year as a result of
global economic recession. The key means to temporarily slow down production
growth will be to intensify replanting of old trees. A total of 300 000 ha is being
earmarked for this purpose. Farmers that participate in the replanting programme
will be given access to high quality planting material at subsidized prices.

Myanmar - oilcrop promotion: In an effort to reduce the country‟s dependence
on imports to meet domestic demand of edible oil, the country has embarked on a
programme to encourage the cultivation of oilcrops. Crops promoted include
groundnut, sunflowerseed and sesame. Improvements in transport infrastructure to
facilitate marketing are also envisaged. Furthermore, foreign private companies
could be allowed to participate in setting up an oil palm industry. The government
programme is receiving support from OPEC as well as technical assistance from
FAO.
Germany - biofuel policies: Reportedly, national mandatory targets for future
biofuel admixture in transportation fuels are being adjusted downward.
Furthermore, from 2015, the calculation basis will be switched from the energy
content of biofuels to the greenhouse gas emission savings resulting from their
use. Of particular concern to the oilcrop sector is a provision that prevents the use
of palm oil and soybean oil under the mandatory schemes and preferential taxation
system until criteria for the sustainable production of biofuel feedstock are in place.

China - state procurement: After prices for domestically grown grains and
oilseeds have declined as a result of record crops and weak demand the
government decided to buy soyabeans, rapeseed and other arable crops for state
reserves in an effort to support prices, protect farmers‟ incomes and stabilize
plantings in 2009. Imported soSoybeans State soybean reserves were not
maintained before. Reportedly, 1.5 million tons have been bought and funding has
been made available for another 2.5 million tons - compared to a total domestic
crop of about 16 million tons. Domestic soybean farmers find it increasignly
diffuclt to compete with imported soybeans.
Thailand - palm oil support: After raising last month the reference price at
which farmers sell palm fruit to crushers, the government plans to purchase palm
oil from oil mills at a guaranteed price, hoping to prevent prices from falling
further. The recent decline in mineral oil prices has made the use of palm as
biodiesel feedstock uneconomic, leading to an excess of supply over demand.
Sustainable palm oil: A first shipment of certified and traceable palm oil -
produced in Malaysia in accordance with RSPO‟s sustainability criteria - has been
delivered to the EU. But environmental and social groups continue to question the
value of the certification pointing at environmentally and socially unsustainable
production methods in the countries of origin.
Argentina - grains export taxation: In Argentina, export taxes on wheat and
maize have been lowered by, respectively, 18 and 20 percent. By contrast, the
duties for oilseeds and their products remain unchanged - despite the recent sharp
drop in global oilseed prices. From 4 December, the following base export duties
apply to grains (in percent, ad valorem): wheat 23, maize 20, soybeans 35,
sunflowerseed 32.
EU - biofuel policies: The EU decided to retain its binding target to have 10
percent of its vehicle fuels sourced with renewable fuels by 2020. To encourage
the use of non-food feedstock, second generation biofuels will count double
against the target, while feedstock grown in high biodiversity and carbon stock
areas will not be admitted. Specific sub-targets according to the type of feedstock
used and the form of transport have not been set. By 2017, in order to be counted
against the target, biofuels need to achieve at least 50 percent reduction in GHG
emission over conventional fuel. For the time being, the carbon footprint of related
indirect land use changes will not be taken into account. A further review of these
policies is envisaged for 2014.
Thailand - soymeal import tariff: For 2009, the tariff for soymeal (imported
from WTO members) has been reduced from 4 to 2 percent. The regulation
requiring eligible importers to also purchase domestic soya meal at minimum
prices set by the government remains in place.
USA - biodiesel feedstock: Towards the end of 2008, the use of animal fat as
feedstock for biodiesel production has dropped sharply in response to the
introduction of stricter biodiesel standards and as prices for vegetable oils
abandoned their record level.
Certification of ‘sustainable palm oil’: Recently, the first two oil palm plantation
companies (both in Malaysia) have been ranked as certified producers of
sustainable palm oil based on the criteria developed by the global multi-
stakeholder initiative RSPO. Several more companies are expected to gain that
status during 2009. A first shipment of certified and traceable palm oil has been
delivered to the EU last November.
Soybean modification providing benefit to consumer: A high-oleic soybean
variety developed in the USA is ready for phased introduction in 2009. Compared
to conventional soybeans, the new variety features a high oleic acid content, a
lower rate of linolenic acid and a reduced percentage of saturated fatty acids.
These traits make the oil more stable and versatile in a variety of food applications
without the need for hydrogenation, thus allowing to avoid the presence of
unhealthy trans fatty acids in food products.
 EU - import approval for new GM soybean: Approval for the importation,
marketing and use in food and animal feed has been granted for the new high
yielding variety known as “Roundup Ready2Yield”. The variety is expected to be
extensively grown in the USA, an important supplier of soybeans to the EU. The
permission is valid for 10 years and the bean (and any product derived from it)
will be subject to the EU‟s strict labelling and traceability requirements. The next
GM product in line for potential approval is a new variety of rapeseed that was
developed and is ready for cultivation in Canada.
 Ukraine - domestic price regulation: With a view to counter the marked fall in
domestic prices of sunflowerseed, the government added sunlflowerseed to the list
of products whose prices are regulated by the state. Such measure will be limited
to the 2008/09 marketing season. The official price band has yet to be announced.

China - state procurement: After prices for domestically grown grains and
oilseeds have declined as a result of record crops and weak demand the
government decided to buy soyabeans, rapeseed and other arable crops for state
reserves in an effort to support prices, protect farmers‟ incomes and stabilize
plantings in 2009. State soybean reserves were not maintained before. Reportedly,
1.5 million tons have been bought and funding has been made available for
another 2.5 million tons (compared to a total domestic crop of about 16 million
tons).
Mexico - oil import duties: Between January and February 2009, the tariffs on
crude and refined vegetable oils will be phased out. The country depends heavily
on imports of vegetable oil and consumers are reported to have been strongly
affected by last year‟s surge in prices.
Mexico - income support: In January 2009, the target prices for soybean and
rapeseed that are used to determine supplementary income payments to farmers
have been adjusted upward by 30-40 percent.
Germany - biodiesel taxation: In line with the overall policy to gradually scale
back support provided to the biodiesel industry, from January 2009 onward,
taxation of vegetable oils used as biodiesel feedstock will increase from 0.10 to
0.18 € per litre, while the tax for B-100 is lifted from 0.15 to 0.18 € per litre.
Ukraine - export policies: The plan to suspend the export duty for sunflowerseed
until 1st September 2009 (with a view to stimulate trade) has been dropped so as
not to hurt the domestic crushing industry. For 2009, the duty has been set at 13%
as opposed to 14% before.
China - state procurement: Further to last autumn‟s purchases (see also issue
No.1 ), the government plans to buy an additional three million tons of soybeans
for state reserves. This could raise the total volume of soybean reserves to up to 6
million tons. However, last year‟s actual purchases of soybeans for state reserves
have been reported at levels below the original targets.
Brazil - ‘sustainable soybean farming’: A global grain trading and processing
company entered into partnership with a local NGO to promote sustainable
soybean farming in the country. The initiative aims at reducing the environmental
impact of soybean farming and minimizing expansion into environmentally
sensitive areas.
Argentina - support to farmers: In early January, the government announced
plans to provide subsidies on fertilizer and loans for purchasing farm machinery.
However, export taxes on oilseeds would not be lowered. Later in the month, the
government declared agricultural emergency in the country‟s main food
producing provinces due to widespread drought – reportedly the worst since 1971.
Affected farmers will be allowed to defer various taxes and debt repayments.
Unofficial estimates for this season‟s soy-crop currently range between 39 and 43
million tons, compared to early-season forecasts around 50 million and last
season‟s output of 46.2 million.
Japan - carbon footprint labelling: The government has launched a pilot project
on voluntary carbon footprint labelling of consumer products, including foods.
Products shall be rated based on the level of CO2 emitted during their life cycle.

Malaysia - palm oil barter trade: For the period 2009-10, USD 70 million worth
of palm oil have been earmarked for bartering for fertilizer with the Russian
Federation and the Democratic People‟s Republic of Korea.
USA - growing market for soybeans with special traits: Production and trade of
soybeans with special traits – notably low-linolenic, food-grade and identity-
preserved non-GMO varieties – is growing in importance in the USA. Reportedly,
as much as 1.6 million tons of food-grade soybeans are exported annually. An
average price premium of 125 USD per ton was reported for non-GMO soybeans.

Indonesia - biodiesel support: Reportedly, the government is considering to
subsidize the sale of palm oil-based diesel when low fossil fuel prices compromise
the profitability of biodiesel production.
EU - butter market support: In response to the sharp drop in dairy prices, the
Commission has reintroduced export refunds for butter. Furthermore, the period
during which aid for private storage of butter is granted has been expanded and
state intervention buying of butter may be allowed to exceed pre-determined levels.

Indonesia - oil palm plantations: Reportedly, the government is considering to
lift temporary restrictions (in place since late 2007) on the use of peatland forests
for oil palm plantations. The measure would allow to increase productivity in the
oil palm sector. The restrictions had been introduced to control carbon dioxide
emissions associated with the use of peatland.
Brazil - conventional soybeans: Reversing the trend of recent years, in the state
of Parana, farmers‟ demand for conventional soybean varieties has grown this
season at the expense of GM seed material. Increased interest for conventional
varieties is explained by the lower cultivation cost associated with those seeds.

China - state reserves of vegetable oil: After the recent release of reserves to
prevent supply shortages and thus price increases, private sources reported that
public stocks are being replenished via the importation of oils from South America.

Canada - trans fat: The government reported progress towards the reduction of
trans fats in food products without increasing the levels of saturated fats. The
country had made the requirement to indicate trans fat content in pre-packaged
food mandatory and, in 2006, the industry agreed to voluntary limits in the trans
fat content of food products.
Malaysia - biodiesel: Government sources confirmed that blending of diesel fuel
with five percent palm oil biofuel will become mandatory on January 2010. This
year, all government vehicles will start using the blend. To remain competitive,
biodiesel sales shall benefit from a subsidy. Once fully operational the programme
is
expected to absorb 500 000 tons of palm oil annually.
India - state imports of vegetable oil: Following the drop in global and domestic
prices for vegetable oils, the importation of oils by state trading agencies for
subsequent distribution to poor households has been suspended.
EU - temporary biodiesel duty: From mid March, imports of biodiesel from the
USA will face temporary anti-dumping and anti-subsidy duties. Tariffs ranging
from 26 to 41 € per 100 kg are expected to apply for an initial period of six
months. Surging imports of biodiesel produced in the USA - and benefiting from
government support there - are considered to have severely injured the competing
EU biodiesel industry.
India - trans fat: A recent study confirms that, on average, trans fat levels in
vanaspati and other products based on partially hydrogenated oils exceed generally
recommended levels. Among refined vegetable oils sold on the market this
problem was not detected. Last year, India has joined the list of countries where
the trans fat content must be declared on labels. Discussions about revised product
standards and the feasibility of introducing binding maximum levels for trans fat
are underway.
Germany - biofuel legislation: The EU Commission has requested that the
sustainability criteria included in a national law on the promotion of biofuels be
streamlined with the relevant EU directive. As a result, importation of vegetable
oils - especially soy and palm oil - for local biodiesel production is expected to
resume. Furthermore, new legislation excluding biofuels that have previously
received state aids from being eligible for national incentives and mandates will go
ahead. Consequently, the importation of biodiesel that has benefited from state aid
could become uneconomical.
Indonesia - biodiesel support: The government confirmed its plan to subsidize
the sale of biofuels by state owned companies depending on how the prices for
fossil fuel and biofuel feedstock (notably palm oil) develop. The subsidy would
amount to Rp 1000 per litre of biofuel distributed. Under the currently envisaged
level of government funding, the sale of up to 750 000 tons of biofuel could be
supported in 2009 - an amount close to the country‟s mandatory consumption of
biofuels in 2009. Palm oil based biodiesel should account for about three quarters
of all biofuel sales.
France - biodiesel taxation: Similar to Germany, where taxes on biodiesel and
biodiesel feedstock have been raised in January, France has announced that all tax
advantages granted to biofuel will be discontinued by 2012.
Indonesia - palm oil exchange: To date the world‟s leading producer of palm oil
lacks an own exchange and futures market for palm oil; local traders and policy
makers are used to follow contracts traded in Malaysia or the EU to determine
prices. Now private sources report that physical trading in CPO through a local
exchange is going to start later this year. State plantations seem committed to sell
at least 20% of their output through the new platform.
United Kingdom and Germany - biofuel targets: The rates of mandatory
inclusion of biofuels in transportation fuel are being corrected downward in both
countries: in the UK, the rate for 2009/10 is expected to be set at 3.25% (down
from originally 3.75%), rising gradually to 5% by 2013/14. In Germany, the rate
for 2009 is being reduced from initially 6.25% to 5.25%, and shall be frozen at
6.25% from 2010.
USA - special traits soybeans: According to industry sources, the importance of
special trait varieties – developed to reduce trans fat and saturated fat content in
the human diet – is growing steadily. The swift replacement of traditional soybean
varieties with new ones (i.e. low linolenic, high oleic and mid olein/low saturate
lines that deliver direct health benefits) is said to have shielded domestic markets
from possible disruptions or contractions in consumption.
EU - olive oil labelling: In July 2009, origin labelling will become mandatory for
extra virgin olive oil sold in the Community. The country of origin, or, in the case
of blends, the type of blending will have to be displayed. The measure aims at
improving guarantees of quality to consumers.
Argentina - trade control: Reportedly, the government has met with farmer
groups and grains exchanges to discuss about the possibility of setting up a
national board that directly regulates and controls foreign trade in grains and
oilseeds. A state agency charged with the same task, the National Grains Board,
was dismantled in the early 1990s.
USA - farm support rules: Motivated primarily by budgetary considerations,
President Obama has called for cuts in farm subsidies over the next decade.
Proposals are reported to include the gradual exclusion of large farms from direct
payments, reductions in the individual payment caps under the commodity
programmes and reduced subsidies for crop insurance. Actual spending for
agriculture is determined by the Congress.
India - soyoil import tariff: The 20% import duty on crude soyoil introduced last
November has been removed again. Soyoil will thus enjoy the same treatment as
other crude vegetable oils which are imported duty free since April 2008. By
doing away with the duty the price premium for soy oil will be restored to normal
levels.
EU - butter market intervention: After reaching the ceiling of 30 000 tons for
automatic intervention buying at fixed prices in early March, the Commission
went on purchasing additional butter into intervention at a price slightly below the
official intervention price. The purpose of these purchases is to contain oversupply
at a period of low market prices.
EU - GM rapeseed importation: The Commission has approved the importation
and processing (but not cultivation) of a GM rapeseed variety for food, feed and
other uses for a period of 10 years. The new variety T45 is characterized by
tolerance to a particular herbicide and is grown primarily in Canada, whose
exports towards the EU are expected to resume thanks to the approval.

USA - demand for sustainable palm kernel oil: An oleo-chemicals company
started to purchase sustainable palm kernel oil certification credits. It is the first
step in creating a segregated supply chain for sustainably produced palm kernel
oil. By doing so palm kernel oil producers that use more environmentally
responsible practices to produce and harvest palm kernel oil are going to be paid a
premium.
 Argentina - negotiation progress: Negotiations between the government and
farmers regarding economic difficulties that afflict the sector resulted in
agreements eliminating export taxes on dairy products, increasing the export quota
for beef and guaranteeing a higher price for wheat sold domestically. The tax
levied on soybean exports remains unchanged. Plans to set up a grain regulating
agency have been postponed.
Pakistan - Indonesia trade agreement: Under preferential trade negotiations,
Pakistan has agreed to reduce duties on palm oil imports from Indonesia by 10
percent, which would put duties at par with those applied to imports from
Malaysia.
Canada - trans fat limits at province level: From October 2009, foods served in
restaurants will be subject to specific limits for trans fat content in British
Columbia. Since 2006, the industry was following voluntary limits at the federal
level.
Malaysia - palm oil market measures: Government efforts to prevent oversupply
on the domestic market continue. Under the 200 000 ha oil palm replanting
scheme, by March 63 000 ha were approved, implying a temporary reduction in
palm oil output by approx. 220 000 tons. Mandatory use of palm oil based B5-
diesel in the entire transportation and industry sector is set to start next January,
entailing a market offtake of approximately 500 000 tons of palm oil. And the
increase in the country‟s duty free export quota for crude palm oil to 3 million tons
in 2009 is expected to stimulate exports.
Brazil - mandatory biodiesel use: From January 2008, all diesel sales had to
include 2 percent of biodiesel, which created a market for about 800 thousand tons
of biodiesel. Biodiesel production capacity is reported to have climbed to 2.6
million tons last year. In order to better use this capacity, the mandatory admixture
was raised to 3 percent in July 2008, and currently a further increase to 4 percent
is under consideration. The obligatory 5 percent blend envisaged for 2013 has
been anticipated to 2010. The main feedstock used for biodiesel production is
soybean oil; its share in total feedstock use was close to 80 percent in 2008.

Argentina - herbicide investigation: The government was reported to have set up
an inter-ministerial committee to investigate the environment and health impact of
glyphosate, the active ingredient in an approved herbicide that is widely used in
soybean cultivation (in Argentina as well as in other leading soybean producers).

USA - soybean rust resistance: Reportedly, US scientist have identified asian
rust resistance genes in soybeans, thus opening the way to the development of
resistant cultivars via conventional breeding or biotechnological means. Asian rust
represents a major threat to soybean cultivation in many countries. Although
fungicide use is effective against the disease, the provision of farmers with
resistant varieties would be more sustainable.
China - improved rapeseed varieties: Scientist are reported to have developed -
via conventional breeding techniques - new rapeseed varieties featuring an oil
content of 55-60 percent, which is 15 percent more than in the varieties currently
used in the country. Among domestically grown oilcrops, rapeseed is the leading
source of vegetable oil in the country.
Argentina - incentive for using domestic soybeans: With a view to privilege the
use of domestically grown soybeans, the government has removed the export tax
exemption applied to soyoil produced from imported soybeans. Furthermore, the
tax break on soybean imports introduced in 2006 has been discontinued, making
imports unprofitable. According to unofficial sources, farmers are currently
stockpiling substantial amounts of old crop soybeans and the above trade measure
also aims at stimulating farmers to release their stocks.
USA and EU - biodiesel footprint: In the USA, soybean-based biodiesel has
been officially estimated to reduce GHG emissions by 22 percent over
conventional diesel. This compares to a minimum 50 percent requirement for
biodiesel to qualify towards the annual consumption targets. Other feedstock with
lower footprint, for example animal fats or waste grease, might be required to meet
the mandatory biodiesel target set for 2012. In the EU, the default values for GHG
emission savings have been set at 31 percent for soy-diesel, 38 percent for
rapeseed-diesel and 19 percent for palm oil-diesel, which compares to a minimum
savings requirement of 35 percent (from 2013 onward). Biodiesel producers may
claim greater GHG emission savings, but the onus of proof will be entirely on
them.
Germany, Spain – biodiesel capacity: This year, private sources estimate the
biodiesel industries of Germany and Spain to run, respectively, at no more than 60
and 10 percent capacity. The low utilization rate is related to reduced public
incentives, limited mandatory blending rates and the drop in crude oil prices that
has eroded the price attraction of biofuels.
China - state soybean reserve: Reportedly, in addition to the 6 million tons of
state purchases scheduled since October 2008, state agencies are planning to buy
another 1.25 million tons of soybean for temporary reserve. For comparison, total
domestic soy output in 2008/09 is estimated at 15.5 mill tons. State purchases are
carried out at prices above prevailing market prices and are meant to stabilize
domestic oilseed production and prevent further declines in prices as farmers are
preparing for the new planting season. The federal government is reported to also
plan stockpiling between 3 and 4 mill tons of the 2009 rapeseed output.

Indonesia - palm oil export tax: The government has kept the indicative world
price at which the export tax on palm oil will be re-introduced at 700 US$ per ton.
Accordingly, this month the exports of palm oil will remain tax-free. (The NW
Europe import price for palm oil has risen markedly last month, but stopped short
of Indonesia‟s trigger price.)
Egypt – subsidized distribution of oil: Reportedly, over the last seven months,
the amount of subsidized oil available to consumers through ration cards has been
raised from 350 000 tons to 900 000 tons per year.
USA, Canada - new oilseeds varieties: GM varieties containing less saturated
fats and thus offering a better health profile are gaining ground in North America.
In the USA, commercialization of a new high oleic soybean variety is expected
later this year. In Canada, high oleic (or low linoleic) varieties are estimated to
account for 10-15 percent of the country‟s rapeseed area. As herbicide resistant
and higher yielding strains become available, farmers are increasingly interested in
growing these specialty crops.
Sri Lanka – palm oil import duty: To assist the domestic coconut industry, the
government is considering to raise the special import duty on palm and palmkernel
oil above the current level of Rs 60 per 1kg.
Indonesia – taxation of palm oil exports: Considering the recent, steady rise in
international palm oil prices, the export tax on palm oil (which, inter alia, aims at
protecting domestic supplies of vegetable oil) is likely to be reintroduced in June.
The tax had been suspended late last year, when a decline in international prices
started weighing on the country‟s palm oil exports.
Indonesia – palm oil export price: Reportedly, the government is studying a
mechanism for setting a national standard price for palm oil exports - so as not to
depend on prices determined in the major European import markets.
EU – subsidization of private olive oil storage: The significant and prolonged
decrease in community olive oil prices is expected to trigger the reintroduction of
private storage aid, which aims at sustaining the income of olive oil farmers.
Support shall be limited to 110 000 tons of olive oil in total.
EU – biodiesel duty: The Commission has proposed to extend the countervailing
duty on biodiesel imports from the USA (provisionally introduced last March) for
five years. The method of calculating the duty could undergo slight modifications.

New Zealand – biodiesel subsidy: To encourage investment into national
biodiesel production, from July and for a period of three years, a subsidy will be
granted on sales of domestically produced biodiesel that complies with
sustainability standards set by the government. B5 blends are widely accepted in
the country, but mandatory consumption targets have been withdrawn last
December. All imported material needs to meet the same standards.
Canada – approval of high oleic GM soybean: Low in trans fatty acids and not
requiring hydrogenation, the oil from the new variety offers improved nutritional
qualities. The bean has been cleared for cultivation, food and feed use in the
country.
Russian Federation – import tax on selected vegetable oils: An import tax of
10% is expected to be introduced soon for palm oil and coconut oil for a period of
nine months. The intention is to temporarily shield domestic dairy products from
the competition of lower priced substitutes.
USA – renewable fuel standard: An expanded renewable fuel standard (RFS-2)
issued in draft form by the EPA has attracted criticism from the industry. In
assessing the life cycle GHG impact of biofuels, the standard considers direct and
indirect emissions, including those related to indirect land use changes. The
justification and methodology for attributing emissions from land conversion to
soybean-based diesel as well as the practicability of the required feedstock
certification are being questioned. Achieving the country‟s biomass-based diesel
targets under the proposed RFS-2 would be challenging if soybean-based diesel
was excluded.
Sales of certified sustainable palm oil: Palm oil that has been produced meeting
environmental and social safeguards is available on the market since November
2008. However, sales of certified palm oil seem to be slow in taking off.
According to tentative figures compiled by the WWF, so far, only about 1 percent
of the sustainable palm oil available on the market has been bought.
Sequencing of oil palm genome: According to official sources in Malaysia,
researchers have finally managed to fully sequence the oil palm genome.
Eventually, this breakthrough will allow enhancing the productivity and
sustainability of oil palm, a plant where yield levels have not significantly
improved over the last decades.
China – soybean state reserves: The government is planning to procure an
additional 1 million tons of soybeans from Heilongjiang province for temporary
storage, in a bid to stabilize the domestic market and protect farmers‟ interests.
Reportedly, since mid 2008, government purchases have accumulated to a total of
7.25 million tons.
EU – biofuel target: An official report states that the EU is unlikely to reach the
indicative 2010 target of 5.75% of transport fuel coming from renewable energy
sources. A community-wide share of 4% is expected instead. The respective share
in the year 2005 was 1%. Biodiesel accounts for roughly three quarters of
renewable fuel use; bioethanol contributes 15%. The EU-Commission estimates
that, by 2020, some 20-30 % of the utilization target is going to be met by second
generation biofuels.
Indonesia - palm oil export tax: Suspended since December of last year, in June
the export tax was re-introduced at a level of 3 percent, in line with the
government‟s policy to levy taxes when the world price exceeds a given level.
While palm oil shipments are likely to decrease, the value of exports is anticipated
to remain stable as are domestic cooking oil prices.
United States - export incentives: After remaining unutilized for five years,
subsidies for butterfat exports will be reactivated for 2008/09 under the Dairy
Export Incentive Program (DEIP). The payments are meant to help exporters meet
prevailing world prices and to remain competitive vis-à-vis subsidized products
from other countries. Allegedly, U.S. producers have seen their international
market shares erode, in part due to the recent reintroduction of export subsidies by
the European Union.
Round Table for Responsible Soy (RTRS): Following in the footsteps of the
Roundtable for Sustainable Palm Oil (RSPO), the international multi-stakeholder
initiative on soy has approved principles and criteria for responsible soybean
production, thereby establishing the basis for the formulation of global standards
on environmentally sustainable and socially responsible soy production, trade and
processing. The next steps will be field-testing the criteria and, eventually,
developing proper certification standards to be used by traders.
Certified palm oil: Neste Oil , a Finnish biodiesel producer, committed to shift to
certified palm oil as sole feedstock (i.e. palm oil produced according to RSPO‟s
criteria for environmentally and socially sustainable production). The company,
which introduced a system of full traceability of the palm oil it uses, expects to use
50 000 tons of certified palm oil in 2009 and considerably higher amounts in the
coming years. Similarly, snack food producer Mars committed to use exclusively
RSPO certified palm oil originating from sustainable sources by 2015. On the
other hand, to date global sales of certified palm oil seem to have been minimal.
Apparently, buyers are concerned about costs and uncertainty of supply.
Reportedly, certification can add a premium of US$ 50 a tonne to palm oil in the
wholesale market.
Brazil - agricultural support 2009/10: The recently announced package of
support measures addresses the increasing economic difficulties faced by the
sector. In particular, the programme raises the supply of credit at controlled
interest rates and lifts the financing limits per beneficiary. Interest rates will
remain unchanged, and the volume of subsidized production loans will increase by
21 percent over last season. Furthermore, agricultural insurance programmes will
be enhanced, cooperatives will be strengthened and guaranteed minimum prices
will increase - especially for soybeans (plus 10%). Overall, special emphasis
seems to be given to commercial and export oriented agriculture (as opposed to
family agriculture). Private sources expect the package to contribute to a recovery
in production in the coming crop season.
China - support to crushers: Reportedly, to support farm sales of rapeseed at
officially set prices, the government plans to offer subsidies to crushers (Yuan 200
per ton crushed). This measure would help farmers to sell their rapeseed crop,
which is expected to hit a new record this year. Similar measures seem to be under
consideration for soybeans, with a view to stimulate domestic soybean production
and to stem the on-going surge in soybean importation.
Germany - biofuel target: Despite opposition expressed by the German
parliament‟s upper house, government plans to cut the 2009 biofuel blending
target - from the current level of 6.25% to 5.25% - and to further raise taxes levied
on biofuels have finally been confirmed. The higher blending ratio will be
introduced only in 2010 and then remain at that level in subsequent years.
Biofuel blends as jet fuel: A major commercial carrier in the USA reported
successful completion of a demonstration flight using a biofuel blend comprising
jatropha oil. Reportedly, the blend performed as well as traditional jet fuel. Among
the key results were a higher fuel efficiency of the blend and substantially lower
greenhouse gas emissions (over the entire life cycle) compared to conventional
fuel. No modifications were required to the aircraft or its engines. The airline
hopes to see those fuels produced in commercial quantities in the near future.

China - soybean export duty: According to a local news agency the current 3
percent duty levied on exports of soybean (as well as other grains and industrial
products) will be abolished from July with a view to promote exports.
Brazil - GM soybean submission: Monsanto‟s submission of insect-protected
Roundup Ready2Yield soybean for regulatory approval has been completed in
Brazil. The US developed variety is heavily targeted at foreign markets and its
approval in producing and importing countries will be key.
Canada - GM soybean approved: A variety high in oleic acid, and thus with
improved nutritional qualities, has been approved for cultivation, food use and as a
feed in Canada. Due to its specific fatty acid profile the oil does not require
hydrogenation, resulting in food free of trans fats. Developed in Canada, the new
variety is being submitted for regulatory approval in major soybean
producing/importing countries including the USA.
Ukraine - biofuel incentives: Through a new law granting significant tax benefits
to biofuel producers the government aims at stimulating domestic production and
consumption of biofuels, notably rapeseed-based biodiesel. To date, only non-
mandatory targets were in place, biofuel production has been negligible, and
rapeseed has been primarily exported to the EU as feedstock for biodiesel. Once
effectively implemented, the new law could make domestic biodiesel production
(for local use and export) more attractive, potentially limiting rapeseed shipments
and stimulating exportation of finished biodiesel, in particular to the EU

EU: biodiesel import duty. EU member states have agreed to extend the
countervailing duty on biodiesel imported from the USA, which was introduced in
March 2009, for the next five years. The measure aims at shielding biodiesel
production in the Community from unfair competition by US exporters. The range
of the permanent duties has been narrowed compared to the one in place so far.
Reportedly, WTO anti-dumping guidelines have been adhered to, thus reducing
the likelihood of a legal dispute between the two blocks.
Market support for butter: In an effort to help their dairy sectors coping with the
prolonged and general depression in prices, the EU and the USA are prepared to
extend their recently re-introduced domestic support measures, comprising aid to
private storage, public intervention buying and the granting of export refunds.

USA: GM soybean. Official sources reported that in US agriculture the rate of
adoption of GM soybean varieties has reached an estimated 91 percent (compared
to 54 percent in 2000 and 7 percent in 1996). Soybeans represent the most widely
and rapidly adopted GM crop; all modification concerns herbicide tolerance. The
marked expansion has taken place in spite of uncertainty about consumer
acceptance and economic and environmental impacts of GM products.

India: biodiesel import duty. The government is planning to reduce the basic
customs duty on biodiesel from 7.5 to 2.5 percent. Due to several factors the
country is facing difficulties in meeting its biofuel consumption targets from
domestic sources.
Certified sustainable palm oil. Suppliers of palm oil certified as sustainably
produced (in line with RSPO criteria) report lower than expected demand from
importers. One explanation is that the global economic slowdown has curtailed
demand from price-conscious buyers: reportedly, crude certified palm oil sells at a
premium of about 50 USD per tonne (uncertified palm oil was traded 600-700
USD per tonne in recent weeks).
India: commodity exchanges taxation. With a view to stimulate trade in
commodities, the government decided to abolish transaction taxes levied on
commodity futures trading and on commodity options.
India: vegetable oil import duties. After reducing import tariffs markedly during
fiscal year 2008/09, the government prefers not to raise them again during
2009/10. As low tariffs remain in place, domestic oilseed and oil prices tend to
remain lower, which leads to benefits for consumers but discourages domestic
production.
Canada-EU dispute over trade in GM crops. The recent settlement of a long
lasting dispute between the two countries is expected to favour in particular future
sales of Canadian GM rapeseed into the EU.
China-Senegal land lease deal. Reportedly, China is set to lease land from
farmer cooperatives in Senegal to grow groundnuts. One third of the output is
envisaged for export while the rest will be destined for local processing and
consumption.
India: subsidized vegetable oil sales. The central government is considering to
repeat last year‟s sales of cooking oil through ration shops should retail prices rise.
To this end, state-owned trading companies would be directed to import up to 1
million tonnes of crude palm oil. To make the operation economic, a subsidy of 15
Rupees per kg of oil sold would be made available.
Brazil: mandatory biodiesel use. Effective July 2009, the mandatory content of
biodiesel in diesel is 4 percent; it started at 2 percent in Jan 2008 and became 3
percent in July 2008. A further increase to 5 percent is expected for January 2010
or three years earlier than originally planned. Annual biodiesel consumption in
estimated to exceed 1.5 million tons by the end of this year.
China: public sales of soybeans. First sales of soybeans from state reserves have
been reported in August. Sales were done through auctions. Reportedly, public
soybean reserves (established for the first time last year in support of domestic
soybean production) have climbed to between 5 and 7 million tonnes. More sales
are expected as the government will try to free space for new-crop purchases. In
addition, to facilitate disposal of state reserves, subsidies may be offered to
crushers.
New options in palm oil futures trading. The Chicago Mercantile Exchange
(which includes CBOT) and Bursa Malaysia are planning to jointly list dollar
denominated palm oil futures using Malaysia‟s Ringgit-based contract as a
benchmark. At the same time, efforts to create its own price benchmark are going
on in Indonesia, the world‟s leading palm oil producing nation: the Indonesia
Commodity and Derivatives Exchange announced the launch of a new palm oil
contract later this year, which follows the launch (with state support) of a new
physical crude palm oil contract last June by the Jakarta Futures Exchange .

Brazil: soya restrictions to protect rainforest. Leading soybean traders and
vegetable oil producers agreed to extend for another year the moratorium on
buying soybeans grown on illegally cleared areas in the Amazon rain forest. The
ban that went into effect three years ago has been extended to July 2010.
EU: GMO traces halt soy imports from USA. EU importers decided to
temporarily suspend soybean imports from the USA after traces of unauthorized
GM maize (i.e. varieties not cleared for use in the EU) were found in US soymeal
shipments. The EU applies a zero tolerance policy for imports of unauthorized
GM material. The USA is a primary source of supply for the EU‟s highly import
dependant feed/livestock industry.
Brazil: biodiesel exportation. The government would like to encourage regular
exportation of soy-based biodiesel, notably to the USA and EU. Reportedly,
sustainability studies have been carried out proving that in the country biofuel is
produced sustainably and in line with EU norms.
Peru: biodiesel imports. The country is reported to have started anti-dumping
investigations on biodiesel imports from the USA, which could lead to the
imposition of countervailing duties.
India-ASEAN free trade agreement. The newly signed agreement will include a
ceiling of 37.5 percent on India‟s import tariff for crude palm oil. In recent years,
the tariff rate ranged between 80 and zero percent. The ceiling could benefit
Indonesia‟s palm oil exports to India.
EU-Indonesia efforts to encourage sustainable palm oil. Reportedly, the EU
could offer incentives to Indonesian producers that adopt sustainable production
methods. Supposedly, investment aid, tax exemption or refunds would be
considered for companies that succeed in reducing GHG emissions along the
production cycle.
USA: export credit programme. Funding for export credit guarantees has been
raised beyond original allocations for selected countries. The measure aims at
facilitating trade flows during the current period of slow global economic growth
and reduced availability of private credit.
EU: special market promotion programmes. EU co-financing for 1-3 year
market promotion programmes amounting to a total value of Euro 62.1 million has
been approved. The commodities covered under the programmes include olive oil.

Africa: Asian rust resistant soybean. A variety resistant to the fungus has been
developed within the region and should be available to farmers in time for the
2010 crop, thus enabling farmers to cultivate soybeans without applying costly
fungicides. Cultivation in key producing countries, including Nigeria, Uganda and
South Africa, should benefit greatly.
China: crushing capacity. The country‟s soybean processing capacity is expected
to expand further as both, state-owned and leading private edible oil producers are
reported to be investing into new, large processing plants.
Progress in sustainable oil palm. According to a study issued by CIFOR (an
international research institute belonging to the CGIAR network), progress in the
application of sustainability standards such as those developed by RSPO remains
limited. Inter alia, the report points to the need for legal and political reforms at
national level to achieve progress.
Food processors reduce trans fat presence. Unilever-USA intends to eliminate
all artificial trans fats (i.e. those stemming from the partial hydrogenation of oils)
from its margarine brands by early 2010. The food company accounts for half the
margarine spreads sold in the country. Concurrently, Cargill informed that it is
reorganizing and downscaling its production of hydrogenated oil as the company
needs to adjust to a significant reduction in demand.
India: changing stance on GMOs. Reportedly, the government is planning to
support the introduction of GM food crops in the country in the coming years with
a view to raise crop productivity and thereby contribute to reducing malnutrition
and hunger. To date the only GM crop allowed in the country is BT cotton.

Indonesia: palm oil export tax. Following the decrease in the international price
for crude palm oil, the country‟s variable exports tax has been reduced to zero
percent in July and is set to remain suspended also in September.
Biodiesel mandatory use: Several countries reported about their plans regarding
biodiesel utilization mandates: Coming November, in Canada, Manitoba will be
the first province to introduce a mandatory blend (B2). In Uruguay, the
introduction of B2 was postponed from January to October 2009 due to delays in
setting up the fuel distribution system. Brazil confirmed its plan to move from B4
to B5 in July 2010, i.e. three years ahead of the originally envisaged date; the
higher blending level is estimated to push annual biodiesel demand to 2.2 mill
tons. In Argentina, mandatory biodiesel use is confirmed to start in January 2010
at the B5 level, implying an annual biodiesel requirement of about 700 thousand
tons. The government of Israel has put programmes for the gradual introduction
(over the 2009-2011 period) of mandatory blending (B5) on hold along with the
planned tax breaks.
GM flaxseed: GM flaxseed that is not authorized for food or feed use in the EU
has been detected in Canadian shipments to EU member states. Actually, in
Canada, which is the EU‟s main supplier of flaxseed, no GM variety of flaxseed is
presently registered for commercial production. The country decided to suspend
all exports of flaxseed to the EU, while concerned authorities have launched
comprehensive investigations with assistance from the industry and in close
collaboration with EU counterparts.
EU - soybean imports: Traces of unauthorized GM material in soybean
shipments originating from the USA led to the rejection of cargoes at EU ports.
Consequently, importers are reported to have voluntarily suspended purchases
from the USA, a major source of supply for the EU‟s heavily import dependent
feed industry. Reportedly, the increased uncertainty about the European feed
industry‟s future supply with soybean meal is causing concern among EU
Commission officials as to the viability of the bloc‟s current zero tolerance
approach on unauthorized GM material. Pressure for a revision of this policy and
for the expeditious approval of new GM varieties seems to be rising.
India - GM crops: First steps towards the cultivation of GM crops have been
reported with the approval in principle of, inter alia, herbicide resistant soybean
varieties by the Ministry of Agriculture. However, approval from the Ministry of
Science and Technology and the Ministry of Environment is still outstanding.
Biodiesel compatible engines: Reportedly, Ford has announced the development
of a new diesel engine for a pickup model that will be fully compatible with
biodiesel up to blending ratios of 20 percent.
China - support to crushers: In an effort to raise sales from state soybean
reserves, reportedly the government is considering to offer a subsidy (amounting
to USD 30 per ton) to soybean crushers.
India - biodiesel consumption: Reportedly, Indian Railways, a major diesel
consumer (that also runs 1800 state busses), decided to get involved in vegetable
oil-based biodiesel production to meet its future requirements.
USA - state laws on biofuel use: Reportedly, the implementation of biofuel
legislation in individual states is awaiting direction from the federal Environmental
Protection Agency as to which type of biofuels will meet anti-carbon pollution
standards.
2nd generation’ GM crops: According to a survey carried out in the EU,
consumer acceptance of 2nd-generation GM crops featuring output traits that
provide benefits such as improved nutritional quality is better than in the case of
1st-generation GM crops that only provide producer-related benefits.
Improved soybean varieties in SE Asia: Reportedly, countries belonging to the
Greater Mekong Delta Sub-region (Cambodia, China, Laos, Myanmar, Thailand
and Vietnam) see good opportunities to develop suitable, high-performance
soybean varieties through conventional breeding techniques as opposed to
employing genetic modification.
Food industry - use of vegetable fats: Reacting to feedback from consumers,
Cadbury New Zealand is reported to have announced that it will stop using palm
oil in the production of its dairy milk brand chocolate and revert to using only
cocoa butter.
High lauric acid canola: The development of a canola variety with 60 percent
lauric acid content (via genetic modification) is reported from Canada. Potentially,
the new variety will compete with coconut and palm kernel, the key sources of
lauric oil traditionally used in the global market.
Oil palm and rapeseed genome: Important progress in sequencing the genome of
the two crops has been reported. The scientific advances are expected to accelerate
the development of crop varieties with higher yield potential and better resistance
to diseases and environmental stress.
Supply of sustainable palm oil: Estimates based on current RSPO (Roundtable
on Sustainable Palm Oil) membership suggest that the amount of palm oil certified
as „sustainably produced‟ is set to grow significantly in the next years. Reportedly,
in May 2009, 0.5 million tons of certified produce were available; but this figure
could rise to 4.5 million tons by end-year, and has been estimated at 9.3 million
tons for 2015. These buoyant estimates assume that all RSPO member companies
will progressively certify their entire output. Absorbing such amounts would
require an expansion in global demand supported by the use of certified palm oil
in power plants and as biodiesel feedstock.

Use of sustainable palm oil: Retailer and private label brand Sainsbury‟s in UK
has pledged to use, by 2014, exclusively palm oil certified as sustainable, or
CSPO; reportedly, the decision was taken after the company observed sales
increases following the introduction of CSPO in certain processed foods.
Likewise, Nestle committed to use only CSPO by 2015 (when sufficient quantities
are expected to be available), and a similar pledge was also made by Marks &
Spencer . The gradual change in buying policies - by which the industry is
responding to new consumer concerns - is made possible by increasing supplies of
CSPO, the possibility to trade certificates and the related decrease in the CSPO
price premium - from, reportedly, USD 40 per ton last year to USD 10-15 today.
Some market participants feel that, as supplies of CSPO continue rising, the price
for certified and conventional product will eventually converge.
Monitoring of sustainable palm oil use: Hoping to encourage the use and
accelerate global purchases of available sustainable palm oil, WWF (a RSPO
founding member) has announced the creation of a „Palm Oil Buyers Scorecard‟ -
a system to publicly grade leading global retailers, traders and manufacturers of
palm oil and palm-based products based on their commitment to purchase, use and
promote sustainable palm oil. Preliminary results seem to suggest that today only
few buyers in Europe are using CSPO, despite its increased availability and
previous commitment by companies to purchase it.
Palm oil environmental footprint: Malaysia - a potential exporter of palm oil-
based biofuel to the EU - decided to conduct in-depth work on the calculation of
the oil‟s impact on the environment. The decision was triggered by forthcoming
requirements in the EU, by which, from 2010, biofuels should reduce GHG
emissions by at least 35% compared to fossil fuels. The default value for palm oil
current assumed by the EU is 19%. However, biofuel suppliers can claim bigger
saving rates by providing adequate proof. Currently available studies put GHG
saving rates in palm oil in a wide range of 19 to 71%, reflecting rather diverse and
complex methods of calculation. Interestingly, up to half of total GHG emissions
in palm oil appear to stem from the release of methane gas during the processing
stage. Consequently, in Malaysia, efforts are under way to equip palm oil mills
with methane capturing technology. Reportedly, the issue of GHG emissions is
also under debate at RSPO, with members split over the proposed incorporation of
emission targets into the standards for sustainable production. Experts noted that
the market is yet to provide clear signals on how it will value efforts by producers
to control emissions and feet that, for producers to make commitments, global
Edible cottonseed: Researchers in the United States reported the development of
genetically modified cottonseed that is both free of gossypol (and hence fit for
human consumption) and resistant to insects and diseases. The new variety has the
potential to add protein to the diet of poor people and raise the income of cotton
farmers. Further tests and approvals by regulatory bodies are required before the
seed can be made commercially available.
Philippines - trans fat regulation: Earlier this year, legislation regulating the
commercialization of trans fat was passed. Accordingly, the sale of fats and oils
containing significant amounts of trans fats is not allowed; food manufacturers are
required to indicate trans fat content on product labels; and trans fat thresholds
apply to products that claim to be “free of trans fatty acids”. The regulations are
expected to contribute to higher consumption of domestic coconut oil at the
expense of imported hydrogenated oils.
Indonesia - palm oil export tax: The export tax on crude palm oil will remain
suspended in December, i.e. for the fifth consecutive month. The base export price
has been adjusted upward but remains below the level that would trigger a
reintroduction of the export tax.
Malaysia - smallholder oil palm support: Reportedly, the government has
allocated funds to assist smallholders in adopting sustainable production practices
and in adhering to the RSPO certification process. Furthermore, during 2009-10,
financial incentives will be provide to smallholders to allow them to participate in
replanting programmes aimed at raising yields - from 20 tons of FFB per ha today
to 35 tons in 2020.
Malaysia - mandatory biodiesel use: Compulsory 5% blending was scheduled to
come into effect country-wide in January 2010, but that rate may now be reduced
to 3%. In Malaysia, producers of biodiesel are allowed to buy their feedstock,
palm oil, at a fixed, subsidized price, with the oil palm industry contributing to the
funding of this scheme. As the recent strengthening in the market value of palm oil
implies a higher subsidy, and considering the very slow uptake of biodiesel
consumption so far, the government and the oil palm industry plan to contain the
outlays for biodiesel subsidization by reducing the compulsory blending rate.
Furthermore, to spur domestic biodiesel demand, the government has announced
that it will drop the 10% tax currently applying to biodiesel sales.
China - soybean production and processing: The government continues to be
concerned about the country‟s strong dependence on imported soybeans and the
uncontrolled expansion in the crushing industry. Reportedly, measures under
consideration by the government include a subsidy to soybean farmers, the amount
of which would be inversely related to the market value of the crop. Also measures
to encourage plantings and processing of groundnut, rape, sunflower and cotton
seed will continue, and no new soybean crushing projects will be approved and
structural improvements in the processing sector will be encouraged.
China - oilseed procurement and public stocks: Reportedly the government
decided to release 2 million tons of soybeans (from the 2008 harvest) from state
reserves, offering crushers a subsidy of Yuan 210 per ton. Furthermore, public
purchases and stockpiling of soybeans is set to resume in December and will last
until April 2010. The price paid to farmers should be Yuan 3740 per ton, or about
1% above last season‟s procurement price, while the crushing subsidy could be
reduced to Yuan 160 per ton. In line with its effort to support farmers and stabilize
domestic output, the government also announced that it will buy 1 million tons of
rapeseed (in addition to the 5 million tons planned last June) at a price of Yuan
3700 per ton. Reportedly, by end September, 3.8 million tons of rapeseed had
been procured.
China - rapeseed imports: As of November 15th, rapeseed shipments entering the
country are required to be certified free of blackleg disease for phytosanitary
reasons - a regulation that hurts in particular exports from Canada (and possibly
Australia), where the disease is no longer a major threat, but continuous to be
present. The three countries are involved in negotiations about a possible delay in
the implementation of the new regulation and about alternative risk mitigation
measures. Meanwhile, rapeseed crushers in China are expected to turn to domestic
supplies, including the ample government stocks accumulated during the past
season.
India - biodiesel exportation: An international biofuel producing company has
reported a first shipment of biodiesel from India to a customer in Europe.
India - vegetable oil exports: The temporary ban on bulk shipments of vegetable
oils introduced in early 2008 (to secure domestic supplies and contain price rises)
has been extended until October 2010.
India - commodity exchange: Reportedly, the Indian Commodity Exchange has
become operational end November and commodities traded include soy oil.
Brazil – soybean moratorium: The moratorium on buying soybeans planted on
land illegally cleared in the Amazon region has been extended for a 4th year.
Meanwhile, NGOs have launched discussions on the environmental effects of
converting vast tracts of Savannah into arable land, in particular for cultivating
soybeans.
Brazil - currency policies: Reportedly, the government is determined to tax
foreign investments in an effort to prevent further appreciation of the national
currency vis-à-vis the US dollar. The strength in the Real tends to raise input costs
for farmers and erodes export earnings - for instance from soybean sales.
Brazil - mandatory biodiesel use: In recent years, the government accelerated the
introduction of mandatory blending rates (inter alia to make better use of the
installed production capacity), and compulsory 5% blending is set to come into
force nation-wide in July 2010. Now the government was reported to consider
gradually moving to 20% blends in big cities by 2015, which is estimated to raise
annual biodiesel consumption to 5.5 million tons.
Colombia - biodiesel mandatory use: biodiesel blending of 10% will become
compulsory in January 2010 - up from 5% in 2009. The new target is estimated to
translate into an annual requirement of 500 000 tons of biodiesel - entirely based
on domestic palm oil, production of which is set at 0.8-1 million tons in 2010.

ASEAN free trade agreement: The agreement (referred to as AFTA) is set to
take effect next January, implying the introduction of common preferential tariffs
ranging between 5 and zero percent for all products, including those previously
deferred under sensitive lists. The six founding members of ASEAN agreed to
immediately reduce their tariffs on key agricultural products - including soybeans
as well as soy, palm and coconut oil - to zero. This measure is expected to affect
internal trade patterns, with the most competitive producers likely to gain market
shares.
Africa - new investments in oilseed production: Several countries in the region
are reporting renewed interest in oilseeds, in particular as biodiesel feedstock.
Government backed, large scale commercial production of biodiesel is planned in
Rwanda, where a private consortium is ready to develop 10 000 ha of jatropha,
aiming at the production of 16 million litres of biodiesel annually. Other biodiesel
feedstock under consideration include, high-altitude oil palm, moringa, castor and
soy. Kenya has introduced a plan for developing biodiesel from jatropha and other
locally grown trees and is eyeing a biodiesel blending ratio with fossil diesel of
5%. Comparable plans have also been launched in Ethiopia, focusing on castor,
jatropha and oil palm cultivation on arid land not used for food crops. In Liberia,
the government is securing major investments in oil palm by private companies
from Malaysia and Indonesia, expecting significant improvements in livelihoods
and social welfare in poor regions, industrial development and new export earning
opportunities. Meanwhile, in Uganda, NGOs have criticized large scale
Turkey - GMO import rules: A insufficient regard the importation of GMO
investments in oil palm for giving new law regulating to environmental regulations
material that has come into force end October started to negatively affect the
country‟s imports of soybeans and soy meal. Foreign rape and sunflower seed,
where non-GMO material is readily available, are expected to partly fill the gap.
USA - groundnut policy reform: The government reported that landmark policy
changes enacted in the early 2000s transformed the national groundnut sector by
eliminating longstanding supply controls and restrictions. Guided by market
forces, the industry is reported to have adjusted quickly, resulting in fewer and
larger farms in the regions best adapted to production. Total area of and prices for
groundnut have fallen, but more efficient and competitive production supported
renewed demand growth, especially in export markets.
USA – biodiesel tax credit: The tax credit of USD 1 per gallon introduced in
2004 is set to expire at the end of the current year. The tax concession has
contributed to making biodiesel an economically viable alternative to conventional
diesel. Legislation extending the tax credit by 5 more years - to allow the biodiesel
industry to grow further - is reported to be under consideration.
USA - rapeseed meal imports: After detecting harmful salmonella bacteria in
shipments from Canada, the US Food and Drug Administration introduced import
alerts on rapeseed meal plants operated by major processors in five Canadian
provinces. The alerts allows inspectors to detain shipments at the border. In the
United States, zero tolerance applies to salmonella bacteria. Reportedly, the import
measure resulted in a reduction in crushing and a redirection of meal exports to
other markets in Canada.
EU - approval of GMO maize: Importation and consumption of four new GMO
maize varieties has been officially approved. The decision is expected to lead to a
resumption (in December) in soybean and meal imports from the United States.
Shipments had come to a halt during September, after small traces of still
unapproved GMO maize were detected in some cargoes.
EU - butter market intervention: Due to continued oversupply and persistently
low prices, public buying into intervention has been allowed to continue
uninterrupted until February 2010, i.e. the start of next year‟s official intervention
period (which normally runs from March to August only). The measure aims at
stabilizing milk prices for dairy farmers.
EU - biofuel environmental footprint: EU standards for calculating the footprint
of biofuels and their feedstock are expected to be reviewed during 2010, once the
EU releases new guidelines for calculating the impact of indirect land use changes
(ILUC). In the meantime, a group of NGOs has claimed that the EU‟s current
renewable fuel targets could increase rather than reduce overall GHG emissions in
the transport sector, and, accordingly, recommended to replace current energy-
based targets with purely GHG-based targets, including life-cycle impact
assessments and ILUC indicators. In addition, also the EU‟s recent assessment that
biofuel production in the EU can be increased via productivity gains and improved
second generation technologies - rather than major expansions in area - has been
questioned.
EU - private sector complaint against US biodiesel export practices: Claiming
that US biodiesel producers/exporters are circumventing the EU‟s anti-dumping
and countervailing duties, the European Biodiesel Board (EEB) announced that it
will lodge a new complaint to the EU trade authorities.
Russian Federation - import tax on tropical oils: According to private sources,
the 10% temporary tariff - introduced last June to afford protection to the domestic
dairy industry - could be lifted in January in an effort to address a domestic
shortage in vegetable oil that is expected to arise from reduced domestic crops.

South African Republic - trans fatty acids legislation: The government is
developing legislation aimed at reducing certain trans-fats in processed and
prepared foods so as to contribute to the reduction of chronic diseases associated
with the presence of TFAs in the diet. The proposed law would affect especially
the use of partially hydrogenated vegetable oils, while naturally occurring TFAs
in animal fats would be excluded. Comparable legislation is already in place in
Denmark, Canada and the United States.
Indonesia - palm oil shipment facilities: Reportedly, official sources announced
plans to build three new ports for shipping palm oil to handle rising output in the
world‟s top producing country. Traders reported that congestions at ports are
increasingly hampering exports from the country. The government is also planning
to provide incentives to boost the development of the palm oil industry at the
downstream level with a view to raise value addition and provide more
employment.
India - trans fat regulation: The Food Safety and Standards Authority of India
was reported to consider introducing a 10% limit on the amount of trans fat
contained in partially hydrogenated vegetable oils (notably vanaspati or vegetable
ghee). The limit could come into effect in 2010 and would be reduced to 5%
during the three subsequent years. The measure is being considered as a means to
lower the incidence of cardiovascular diseases.
Indonesia - palm oil export tax: Following the rise in the international price for
palm oil beyond 750 USD, the government has announced the reintroduction of
the export tax on crude palm oil at 3% in January 2010. The tax had remained
suspended since August 2009.
Myanmar - vegetable oil importation: Reportedly, the country‟s health ministry
has banned the importation of selected brands of vegetable oils of Thai and
Malaysian origin on the basis that these contain chemical colour agents that do not
conform with the relevant health standards.
Argentina - mandatory biodiesel use: A delay in the implementation of the 5%
mandatory biodiesel blending into conventional diesel from January to March
2010 has been reported, Apparently, negotiations between the government and
biodiesel producers regarding the required adjustments in infrastructure could not
be completed in time.
Republic of Korea - biodiesel support: Reportedly, the government has decided
to raise mandatory biodiesel blending to 2% in 2010 compared to the 2009 level of
1.5%. In addition, also the tax due on diesel fuel will be waived. Korea started
blending with biodiesel in 2006 as the first country in Asia.
India - coconut support: A new insurance scheme for coconut farmers has been
launched in Kerala, the country‟s main coconut growing state. Farmers are
expected to pay 25% of the insurance premium, while the remainder will be borne
by the federal and state government.
EU - biodiesel tax breaks: Norway decided to significantly reduce the tax break
enjoyed by biodiesel; the measures is taking effect in January 2010. Similarly,
Italy plans to drastically cut the biodiesel quota that enjoys reduced excise duty.
By contrast, in Germany, the government decided to postpone the gradual rise in
taxes levied on biofuels that was to be implemented from 2010 onward.

USA - biodiesel tax credit: The US House of Representatives has approved the
extension of the USD 1 per gallon tax incentive - which was due to expire on 31
December 2009 - by one year, i.e. through the end of 2010. Now final approval is
required by the Senate. According to industry sources, biodiesel production could
become uneconomic in the absence of the tax credit.
Sustainable palm oil:Reportedly, at a recent RSPO meeting, WWF reported that
despite the availability of safe, environmentally-friendly palm oil options, Western
companies did not appear to meet commitments to only buy sustainably produced
palm oil. The organization found that, while RSPO members were increasingly
adopting improved production practices, the major issue of GHG emissions
involved in land use changes was not adequately addressed and that related
measures continued to be of a voluntary nature only.Meanwhile, global consumer
goods company Unilever decided to suspend purchases of palm oil from a
particular supplier in Indonesia until the same could prove that its plantations were
not damaging high conservation value forests nor expanding onto peatland
areas.In the meantime, official sources in Indonesia confirmed the national target
to expand total area under oil palm to 18 mill ha (from today‟s level of 9.7 mill ha)
- while fully adhering to social, economic and environmental sustainability
standards. Allegedly, the expansion was needed to allow the country meeting its
commitments regarding overall reduction in GHG emissions. In Colombia, the
government seems determined to promote environmental and social certification in
China - soybean import licensing: Reportedly, the government has announced
that all foreign soybeans purchases will become subject to an automatic import
license system. The measure would facilitate monitoring the flow of soybean
imports into the country. Among traders, concern has been voiced that the new
licensing system could delay shipment operations.
THAILAND - exports of palm oil under AFTA: Thai sources estimate that as a
result of the common preferential tariffs recently introduced under the ASEAN
Free Trade Agreement (AFTA), the country will loose 2.6% or US$ 46 million of
its export business to Malaysia.
ASEAN-China free trade area (ACFTA): The trade agreement has come into
force at the same time as trade got liberalized within the ASEAN block itself.
Under the accord, China and the six founding ASEAN countries (Brunei,
Indonesia, Malaysia, the Philippines, Singapore, and Thailand) will remove tariffs
on 90 percent of imported goods. The other four ASEAN members (Cambodia,
Laos, Myanmar, Vietnam) will follow suit in 2015. As to oilseeds, oils and meals,
ASEAN exports of palm oil (primarily from Malaysia and Indonesia) are expected
to benefit from improved access to the Chinese market. Palm oil, which belongs to
the list of sensitive products, will see its import tariff reduced from 30 percent to 9
percent, and further reductions are scheduled for the coming years.
CHINA - rapeseed state reserves: The country‟s rapeseed stockpiling
programme continues to be active: reportedly, state agency Sinograin bought 4.05
mill tons by last December and the purchasing programme has been extended to
February 2010. The operations, which include a fix price offered to farmers, tend
to stimulate traders‟ interest for cheaper rapeseed imported from abroad.
CHINA - soybean crushing capacity: With new crushing facilities expected to
come on-stream this year, the country‟s annual soy processing capacity could
approach 100 million tons. However, the current capacity utilization rate is
estimated at less than 50%. Reportedly, the government could reject new
applications for processing plants or expansions with a view to curb over-capacity.

INDIA - soybean futures trading: Reportedly, soybean processors are calling for
curbs on futures trading in soybeans. They are concerned about the recent hike in
domestic soybean prices - which affect the country‟s soymeal export prospects -
and claim that futures operations have contributed to the rise in prices. The
concerned regulatory bodies have rejected these requests, saying there was no
evidence for the suggested effect on prices.
INDONESIA - infrastructure development: Delegations of government and
business leaders from Indonesia and Japan started discussing a project under
which Indonesia - assisted by Japanese private companies - will accelerate
infrastructure development in selected regions to assist industrial growth. The
initiative is expected to benefit the palm oil industry and allow further growth in
the sector.
KENYA - domestic market competition: The country‟s Commission on
Monopolies and Prices reportedly has ordered in-depth investigations into
activities of edible oil producers and distributors for possible cartel activities and
collusion to control domestic prices taking advantage of market dominance.
LIBERIA - oil palm investment: A major Indonesian oil palm operator is
reported to consider investing in Liberia‟s oil palm industry. Negotiations with the
government on a concession agreement are reported to be on-going. The project
will have to conform fully to the country‟s environmental master plan and
standards. The investment plan envisages the development of up to 240 000 ha
(including 40 000 ha run by out growers), and would produce over one million
tons of palm oil per year.
UGANDA - oil palm development: Reportedly, the government has released new
funds to expand oil palm growing in the country via public-private partnerships.
Also, a palm oil pricing committee has been set up to ensure adequate returns for
farmers. Public funds will be made available for purchasing land, and district
leaders have been urged to allocate more land for oil palm cultivation. Meanwhile,
according to private sources, under an on-going public-private project, the
government has been asked to make available for oil palm growing grassland
portions that belong to a forest reserve.
AUSTRALIA - GM rapeseed: Reportedly, the government has announced that,
from this year, GM rapeseed may be grown in the country. Once GM varieties
enter the market, trade with the EU - where importation of GM material is subject
to specific regulations - could be affected.
CANADA - effects of biofuel production: Reportedly, the government has
commissioned a study on possibly harmful environmental effects associated with
the production of biofuels. Official sources pointed out that the commissioning of
the study does neither presuppose that there are any such effects nor alter the
government‟s commitment to renewable fuels.
CANADA - support to rapeseed sector: The government and the Canola
Council of Canada will together invest in the development of a comprehensive
market strategy for the rapeseed sector. The initiative aims at improving access to
international markets. Measures will include the examination of non-tariff trade
barriers and the promotion of best practices so as to meet the standards of
importing countries.
GATES FOUNDATION: A reputed biotech expert with extensive experience in
the development of genetically modified seeds has been appointed as head of the
Foundation‟s Agricultural Development Program. In recent years, the foundation
focused much of its agriculture efforts on helping small farmers improve
production and commercialization of their crops. In addition, the foundation
started to invest in higher tech solutions for combating hunger and disease.

Jatropha curcas genome: Although considered a promising biofuel crop for
developing countries, jatropha‟s off-take as a commercial crop has so far been
hampered by the absence of certified plant material with proven yield potential.
Reportedly, to address this problem, a group of science companies in the US is
committed to work on the plant‟s genome and on the systematic introduction of
promising traits, so as to develop stable, high performance and region-specific
cultivars.
GM soybean beneficial to consumers: Most GM soybean varieties developed to
date were designed to help farmers by making weed and disease control easier.
Now Monsanto is ready to launch a new variety that - rich in omega-3 fatty acids -
promises to deliver health benefits for consumers. Researchers generally concur
that omega-3 fatty acids are helpful in combating cardiovascular diseases and can
benefit the brain.
USA - revised Renewable Fuels Standard: The new programme (referred to as
RFS-2) that came into effect last month sets the target for national consumption of
biomass-based diesel in 2010 at 0.65 billion gallons, corresponding to 1.1% of
total diesel sales, to which the 0.5 billion gallons that were not consumed last year
can be added. Reportedly, 20% of the target may be carried into 2011. The
mandate will increase gradually in 2011 and 2012, while subsequent targets will
be determined later. Furthermore, starting this year, measurement of GHG
emissions during fuel and feedstock production, distribution and use will include
emission stemming from indirect land use changes. Biomass-based biodiesel must
lead to at least 50% reduction in lifecycle GHG emissions compared to petroleum-
based diesel. According to the new RFS-2 standards, soy oil and waste oils, fats,
and greases all comply with this requirement. Reportedly, the default GHG
emission savings of soy oil-based biodiesel has been set at 57%, which, depending
on the production method, can even reach 85%. For domestically produced
feedstock no additional certification will be required. As to competing palm oil, it
EU agricultural support: The EU‟s latest official how it is produced;
may-or may not meet the requirements depending on notification to the WTO -
which covers the period up to 2006 - shows a significant increase in total farm
support outlays since 2002. Reportedly, total support outlays added up to Euro
90.7 billion in marketing year 2006/07, compared to 75.6 billion in 2002, when
the level of support reached a fifteen- year low. The rise is due to a surge in “green
box” payments, i.e. subsidies that have no, or only minimal effects on trade or
production. This surge is only partly offset by a drop in “amber box” (most trade
distorting, production-linked) payments and “blue box” (production limiting)
payments. Since 2005, oilseed producers - and arable crop producers in general -
benefit primarily from green box payments, notably the „single farm payments‟
that are decoupled from production and thus exempted from reduction
requirements under WTO.
INDONESIA - palm oil exports: According to official sources, the country plans
to limit exports of crude palm oil at 50% of output by 2015 and 30% by 2020 - in
an effort to boost the domestic downstream processing sector, thereby creating
employment. To attract the required capital for investment, the government would
provide fiscal incentives and encourage banks to lend at reduced interest rates.
Currently, well over 50% of palm oil exports are in crude form. Reportedly, the
industry expressed concern over these plans, pointing out that such policies could
induce importing countries to raise tariffs on refined palm products - also in a bid
to encourage refining and downstream processing at the local level.

INDONESIA - PAKISTAN, oil palm trade: Indonesia is reported to be
negotiating with Pakistan about its import tariff for palm oil. Currently, due to a
preferential trade agreement that Pakistan signed with Malaysia in 2007,
Indonesian palm oil is subject to a higher tariff than produce coming from
Malaysia. Indonesia aims to have its exports charged with the same tariff enjoyed
by Malaysia.
CHINA - sales from state soybean reserve: Some 200 000 tons will be released
from state reserves in a move to free public storage space. During 2008/09
marketing year, total state purchases amounted to 7 million tons. However,
according to market sources, the state-set purchase/selling price of 3774 Yuan per
ton is both, too low for soybean farmers to sell and too high for soybean
processors to buy: rising domestic production costs and competitively priced
imports continue to threaten the market for home-grown soybeans.
UKRAINE - sunoil export quota: Reportedly, the government is considering to
reinstall temporary export quotas for sunflower oil. At their current pace, export
activities tend to result in domestic shortages, price rises and idle crushing
capacity. Monthly shipments could be capped at 159 thousand tons, which
compares to recent sales of 200 thousand tons. The last time such quotas were in
place was in mid 2008.
Spread of GM oilseeds: According to ISAAA (the International Service for the
Acquisition of Agri-Biotech Applications), in 2009, GM soybeans accounted for
three-quarters of global soybean plantings (or two-thirds, when FAO data for total
area are used). Herbicide tolerant GM soybeans remained the world‟s principal
biotech crop in 2009, occupying over 50% of the global area cultivated with GM
crops. Another 5% of the global GM crop area is occupied by biotech rapeseed.
Globally, one out of five hectares planted to rapeseed use GM varieties.

BRAZIL - new GM soybean: A herbicide-tolerant soybean jointly developed by
private company BASF and public research institute EMBRAPA has received
approval for commercial cultivation by the relevant national authorities. The first
genetically modified crop developed within Brazil will become available in the
2011/12 season. Meanwhile, the owners will seek approval in key overseas export
markets and also initiate work on the crop‟s adaptation to production and
regulatory conditions in neighbouring countries that produce soybeans.

 Non-GM, herbicide tolerant plant: In Europe, a patent has been granted for the
production of a non-transgenic plant tolerant of glyphosate and other widely used
herbicides. Reportedly, tolerance is achieved by using the plant‟s natural processes
and without the introduction of foreign genetic material. This way, farmers would
be offered a non-GM alternative that still enables them to maximize yields of key
crops. Commercial application, if materialized, could prove interesting in countries
where cultivation of GM material is subject to restrictions.

Biodiesel compatible cars ex-factory: General Motors announced that its new
models of heavy- duty diesel pick-ups will have certified B-20 biodiesel capability
(B20 is a blend of 20 percent biodiesel and 80 percent conventional diesel).
AUSTRALIA - cultivation of GM rapeseed: After the states of New South
Wales and Victoria, cultivation of GM rapeseed has also been approved in
Western Australia. With the addition of the country‟s most important rapeseed
growing state, GM varieties will now be allowed on almost 90% of the country‟s
rapeseed area.
CHINA - soyoil import regulations: According to industry sources, the
government is considering to tighten the procedures for granting import
permissions for soybean oil and to enforce stringent rules on maximum solvent
residue levels in imported oils. If introduced, such measures would affect nations
exporting soybean oil to China, notably the country‟s main supplier Argentina.
INDIA - agricultural support: The newly released 2010/2011 federal budget
contains provisions to support agriculture as a whole, notably measures to ease the
credit flow into the sector, to bring down input costs and to attract private
investment into agriculture - especially for sugar and foodgrain warehousing as
well as for cold storage. It also includes plans for extending the green revolution to
the eastern region of the country and for organizing „pulses and oil seed villages‟
in rainfed areas so as to enhance productivity in dryland farming and promote
conservation practices. Other, nation wide initiatives to encourage oilseed
production and improve productivity in that sector were not reported, nor plans to
bring vegetable oil import duties back to their historic level.
INDONESIA - palm oil export tax: In response to rising global palm oil prices,
in April, the ad valorem export tax will be raised to 4.5% in April (from the 3%
rate applied since last January).
INDONESIA - oil palm futures: The Indonesia Commodity and Derivatives
Exchange is ready to launch a crude palm oil futures contract in April with a view
to create a local benchmark price.
PERU - antidumping duties on US biodiesel: Reportedly, the provisional anti-
dumping duty imposed late last year on imports of 100% biodiesel from the US
has been revoked in March.
UNITED STATES - biodiesel tax break: The tax credit of 1 USD per gallon of
marketed biodiesel - which expired last December, negatively affecting the
profitability of biodiesel production - has been retroactively renewed until the end
of 2010. To be enacted, a final bill still has to be issued. With the renewal,
demand for soybean oil and other feedstock for biodiesel is set to resume.
Currently, around 10% of annual soy oil output is absorbed by the biofuel industry.

Sustainable palm oil supply: RSPO has estimated current global supply of palm
oil certified to comply with its sustainability criteria at 1.5 million tons per year,
mostly coming from Malaysia. By the beginning of 2011, supply should double to
3 million tons as the number of certified plantations continues to rise. Due to the
on-going expansion of supplies, the premium for certified palm oil is reported to
have fallen from 50 USD per tonne at the end of 2008 to USD 10 today. While
this should spur demand for certified oil, it could also discourage producers from
shifting to the more expensive methods required to produce and market
sustainable palm oil.
Environmental concerns in palm oil trade: Information published by
environmental NGOs regarding alleged illegal land-clearing and improper land
conversion by selected oil palm plantations in Asia could lead major traders and
end-users of palm oil (including Cargill , Nestlé and Unilever ) to shift sources of
supply depending on the outcome of on-going investigations.
Mandatory biodiesel blending: ARGENTINA: Reportedly, the long announced
B5 blending mandate has come into force in March. Private sources estimate the
amount of biodiesel required per year to fulfil the mandate at 860 000 tonnes.
Total biodiesel production in 2010 is forecast between 1.6 and 2.2 mill tons
(compared to 1.2 mill in 2009), part of which will be exported. MALAYSIA:
After a number of postponements, the government is reported to be ready to
implement B5 blending in June this year and to make available public funds to
defray the costs associated with production and distribution.
Chicago futures markets: Coming May, the CME Group Inc. intends to launch
an electronically traded, US$-denominated futures contract for crude palm oil
using the Bursa Malaysia Derivatives ringgit-denominated benchmark. The
partnership between the two platforms aims at offering an alternative means of
hedging risk to companies that trade in dollars and creates new opportunities for
cross-trading with soybean oil.
CHINA - state purchases of rapeseed: Reportedly, government purchases of
rapeseed for state reserves will continue this year. The official buying price has
been set at CNY 3900 per ton.
EAST AFRICA - oilseed supply shortages: Reportedly, limited availability of
locally grown oilseeds is causing oil crushing and refining plants to work below
their installed capacity. Concerned processors use oil palm (Uganda) and
sunflower and cotton seed (Tanzania) as raw material. Cooking oil consumption in
both countries remains heavily dependant on imported oils.
EU - environmental sustainability of biofuel use: A study prepared by IFPRI
(on behalf of the EU Commission) states that, at the currently assumed
consumption levels - namely biofuels accounting for 5.6 percent of transport fuels
in 2020 - the environmental sustainability of biofuels is not significantly reduced
when the effects of indirect land use changes (ILUC) are taken into account.
Above the 5.6% share, however, ILUC emissions could rapidly increase,
potentially eroding the environmental sustainability of biofuels. For biodiesel, the
study assumes that most of the required production increase comes from
domestically grown rapeseed. It also claims that the environmental sustainability
of palm oil-based diesel remains similar to that derived from rapeseed oil, even
when peatland emissions are taken into account. To achieve maximum GHG
emission reductions, the study recommends that import demand concentrate on
more sustainable sugar cane ethanol. Also, the removal of import tariffs for
biofuels is recommended as this should allow production and consumption to shift
towards more emission-efficient biofuels, in particular sugar cane ethanol. The
study has further fuelled the debate on the suitability of different biofuels and the
GERMANY - biofuel legislation: In line with the EU Renewable Energy
Directive, last year Germany prepared national legislation introducing the need to
proof sustainability via an officially approved certifier if biofuels were to be
eligible for tax incentives and count towards national targets. Originally scheduled
to come into effect on 1st July 2010, implementation has now been postponed to
1st January 2011. According to private sources, under the regulation rapeseed oil
could be considered as a more sustainable biodiesel feedstock than palm oil or soy
oil.
ICELAND - volcano eruption: The impact of the emission of volcanic ash on
agricultural production in Europe and the CIS area is reported to be negligible as
the magnitude of the eruption was not big enough to significantly affect regional
weather patterns. However, the prolonged disruption of air travel across Europe
has significantly affected parts of agricultural trade between Europe and the
developing world: producers of horticultural products, cut flowers and other
perishable goods in particular in Africa suffered greatly as they entirely rely on air
transport and cannot easily divert to other markets. Trade in bulk commodities like
oilseeds and derived products rely on shipment by sea and thus have not been
affected.
INDIA - new rapeseed futures: The National Commodity & Derivatives
Exchange Ltd. (NCDEX) is reported to have launched a rapeseed futures contract
last month in the Northern state of Haryana.
Indonesian certification initiative: Reportedly, the agricultural ministry of
Indonesia is planning to set up a national certification scheme for sustainably
produced palm oil (Indonesian Sustainable Palm Oil, ISPO ). The scheme, which
could become operational before the end of 2010, aims at protecting sales to
markets where environmental concerns are important. Details on how the
certificates would be granted are not yet available. The initiative follows reports
about important buyers like Unilever and Nestlé suspending purchases from
certain Indonesian suppliers on environmental grounds.
PERU/CHILE - fishmeal and oil production constraints: Output from the
world‟s leading supplier Peru is anticipated to decline further in 2010. To protect
marine resources during the on-going El Niño weather pattern, the government has
limited the 2010 catch in the country‟s main fishing areas to 2.5 mill tons
(compared to an average of 3.8 mill tons in the past five seasons), and the fishing
season will be opened only on 13 May (compared to last year‟s 20 April). The cuts
hit world markets at a time when global supplies are already reduced following the
massive, earthquake related damage to fish processing plants in Chile, the second
biggest exporter of fish meal and oil.
Segregated supply chains: Global vegetable oil supplier IOI-Loders Crocklaan
Europe announced the imminent sale of fully segregated, RSPO-certified palm
oil. The company claims to be the first supplier in continental Europe. Sales are
scheduled to begin once a new refinery featuring the technology and storage
capacity that is required to fully segregate sustainable palm oil from all other oils
opens in June 2010. The new chain should permit full traceability and would allow
manufacturers to claim that a given product only contains certified sustainable
palm oil.
Trials with 100% renewable diesel:Finnish refining and marketing company
Neste Oil reports that it started testing diesel fuel based exclusively on renewable
raw materials on a range of different cars. Allegedly, the fuel allows a reduction in
GHG emissions of 40-80% compared to conventional fossil diesel.
USA - rapeseed meal imports: While the strict control system regarding possible
salmonella contamination in rapeseed meal originating from Canada remains in
place, another crushing plant in Canada has been added to the import alert list. The
restrictions have lead to a temporary reduction in shipment from Canada as the
USA represents Canada‟s main client for rapeseed meal.
Progress in sustainable palm oil. Use of certificates: Unilever reports to have
secured enough certificates of sustainable palm oil to cover the entire requirements
of its business in Europe (as well as in Australia and New Zealand). The effort is
part of the company‟s commitment to source all its palm oil from sustainable
sources by 2015. Unilever uses a certificate trading programme (GreenPalm )
which allows palm oil producers that follow RSPO‟s criteria for environmentally
and socially sustainable farming to increase their earnings by selling certificates.
Until properly segregated supply chains for sustainable produce become widely
available, certificates are used as an option to encourage growers to comply with
RSPO requirements and certify their plantations as sustainable.

				
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