Malaysia's palm oil council rejects British ad watchdog ruling on commercials

 Fri, Jan 11 2008, 09:17 GMT

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KUALA LUMPUR (Thomson Financial) - Malaysia's palm oil council rejected on Friday a ruling by the British advertising watchdog that its advertisements were misleading, saying the charge was subjectively inferred and that Malaysian oil palm plantation companies practiced sustainable development.

The Advertising Standards Authority (ASA) this week censured the commercials, saying they wrongly implied that Malaysia's vast palm oil plantations were good for the environment.

The advertising watchdog said the Malaysian Palm Oil Council's (MPOC) advertisements misleadingly implied that palm oil plantations were as bio-diverse and sustainable as the native rainforests they replaced.

"The complaint subjectively infers that oil palm plantations typically replace native rainforests, and this is an inference that we refute," said the palm oil council in a statement posted on its website.

The first commercial showed a palm oil plantation while a voice-over said: "Its trees give life and help our planet breathe, and give home to hundreds of species of flora and fauna."

The ASA said the advert was likely to mislead viewers about the environmental benefits of the plantations compared with native rainforest, and that the claim about flora and fauna was also likely to mislead.

The second advert's voice-over said: "Its trees give life and help our planet breathe. Its fruit provides vitamins for our bodies and energy for our daily lives."

"Because there was not a consensus that there was a net benefit to the environment from Malaysia's palm oil plantations, we concluded the ads were misleading," the ASA said.

The MPOC said its commercials drew no comparison between oil palm plantations and native rainforests.

"The ad says that palm oil plantations support a great deal of bio-diversity and have a long tradition of sustainability, both of which we consider to be the case," it said.

"We do not feel that the advertisements mislead in any way, and we stand by our claim that Malaysian palm oil is produced sustainably," said the MPOC. It said it was "extremely disappointed" with the ruling.

No new forest areas have been allocated for planting oil palm since 1990 and oil palm expansion in Malaysia has largely used land zoned for agriculture, it said.

"We submit that oil palm plantations can be, and often are in Malaysia, bio-diverse and sustainable. Clearly this is a matter of interpretation," said the MPOC.

The price of crude palm oil has scaled new highs in recent months, in tandem with that of crude oil, as the vegetable oil can be blended with fossil fuel to make biodiesel.

Soaring palm oil price has prompted plantation companies to embark on aggressive oil palm expansion, but environmentalists warn that large scale expansion could worsen deforestation in the region.

Malaysia and neighbouring Indonesia are the world's two largest palm oil producers.

aipeng.soo@thomson.com

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