Palm Oil, Environmental Objectivity, and the Political Economyof Trade Discrimination: A Review of International Hypocrisy inAgricultural Trade Policy

Abstract

This qualitative literature review examines the paradoxical treatment of palm oil in international trade policy, where the most land-efficient and productive vegetable oil faces disproportionate regulatory scrutiny compared to less efficient alternatives. Through thematic analysis of peer-reviewed literature published between 2020 and 2025, this study synthesizes evidence demonstrating palm oil’s superior biophysical characteristics—including yields of 3.3-4.0 tons per
hectare (8-10 times higher than soybean, rapeseed, or sunflower) and significant carbon sequestration capacity of 64.5 tons CO2/ha/year—while revealing how environmental narratives mask protectionist motivations. The analysis critically evaluates the European Union’s Renewable Energy Directive II (RED II) as a discriminatory instrument that selectively classifies palm oil as “high ILUC-risk” while exempting European-produced oilseeds, despite objective life cycle assessment data indicating palm oil’s lower overall environmental impact. Drawing on World Trade Organization dispute proceedings (DS593, DS600) and extensive empirical research, this review demonstrates that international palm oil discrimination constitutes environmental hypocrisy, driven primarily by economic interests protecting domestic farmers in importing countries rather than genuine sustainability concerns. The study concludes with policy recommendations calling for the enforcement of strict, crop-neutral trade standards based on land-use efficiency to dismantle green neocolonialism, alongside the establishment of a transnational framework that institutionalizes scientific objectivity in global vegetable oil governance.