Trump administration to shut down palm oil of Malaysia’s second company amid forced labor findings

Trump administration to shut down palm oil of Malaysia’s second company amid forced labor findings

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It is the latest in a series of customs and border protection restrictions aimed at stopping goods made by forced labor from entering the US market.

CBP on Wednesday issued a “release order” allowing the agency to detain loads of palm oil and palm oil products produced from Sime Darby Plantation Berhad.

“Palm oil is an ingredient in many products that American consumers buy and use. And I think it’s important for manufacturers and importers to be aware of where they are at greater risk of forced labor, and to demand that their suppliers keep. to protect the human rights of their workers, ”said Ana Hinojosa, executive director of CBP’s Directorate of Trade Legislation.

After a months-long investigation into alleged labor abuse, CBP has determined that palm oil production in Malaysia meets the criteria to hold imports to the US.

Sime Darby Plantation Berhad is the largest oil palm plantation company in the world per planted area and according to the company produces about 20% of the world production by capacity.
This is the second order to focus on Malaysian palm oil in recent months. Earlier this year, CBP blocked the import of palm oil from FGV Holdings Berhad, a Malaysia-based agricultural company, after years of investigation.

The latest investigation provided evidence of debt bondage, poor living and working conditions, lack of sanitation, manipulated wages and excessive overtime at Sime Darby Plantation Berhad, Hinojosa told CNN.

“In many cases, we also found cases of physical violence, sexual violence, intimidation,” she said.

Hinojosa said the “vast majority” of palm oil comes from Malaysia and Indonesia. She said palm oil plantations in Malaysia are very remote areas – away from transport and communications.

In the fiscal year 2020, the US imported about $ 410 million of crude palm oil from Malaysia, which according to preliminary CBP data accounts for about 31% of total US oil oil imports. It does not include products that include palm oil.

In many cases, she said, there are armed guards at these plantations restricting the movement of workers, and there is a ‘strong link’ between forced labor and countries or industries that are heavily dependent on migrant workers.

Sime Darby Plantation Berhad employs about 24,800 migrant workers, representing 63% of their workers on the ground in Malaysia, according to CBP.

In the past financial year, CBP issued 13 orders aimed at forced labor practices, ending in September 2020.

In late November, CBP announced that it would continue shipments containing cotton and cotton products from a major cotton producer in the western Xinjiang region of China due to concerns about forced labor.
The US has had a ban on the import of goods produced by forced labor since the early 1930s, but enforcement has been extremely sparse. A 2016 amendment to the law that ended exceptions, coupled with greater awareness and pressure from then-CBP commissioner Gil Kerlikowske, prompted the agency to use its authorities more aggressively, agency officials said earlier. told CNN.

During the Trump administration, the agency stepped up its efforts in this area.

‘One thing we sometimes ask is,’ Is this going to change administration? “And I will have to say that this is an issue that is very divisive and very ambiguous,” Hinojosa said.

Although CBP has not yet taken a deep dive into the Biden transition team on forced labor issues, Hinojosa predicted it would remain a priority for the agency.

“You will see a lot more of this in the coming months and years,” she said.

Update: After the story was published, Customs and Border Protection said it provided an inaccurate figure of Sime Darby Plantation Berhad’s production capacity for Malaysia. This story has been updated with figures from the company.

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