Palm oil grown on recently deforested land is unlikely to be acceptable for use in European biodiesel, a draft report from the European Commission shows.
The decision aims to curb any environmental damage from biofuels and could limit future export markets for Asian producers such as Indonesia's PT SMART, Singapore's Wilmar and Malaysia's Sime and IOI Corp.
The European Union aims to get 10 percent of its road fuels from renewable sources by 2020, and 7 percentage points are expected to come from land-using crops such as grains, palms or sugar cane.
But critics charge that the multi-billion-dollar market will compete with food crops, forcing up grain prices and encouraging farmers to expand their land by hacking into tropical forests.
The EU's executive arm has responded with a set of environmental standards, which will be announced by Energy Commissioner Guenther Oettinger Thursday.
The development of the rules has ...