Malaysia Country Report 2012

MPOB champions nation's crucial palm oil industry

Discovery Reports

PUBLISHED : Monday, 24 September, 2012, 12:20pm
UPDATED : Saturday, 25 May, 2013, 1:58am

Spearheading initiatives to develop Malaysia as the global palm oil hub, the Malaysian Palm Oil Board (MPOB) is pursuing stronger collaboration with the country's biggest market: the mainland. With the establishment of the Palm Oil Research and Technical Service Institute of MPOB (PORTSIM) on the mainland, MPOB seeks to educate the Chinese market about the benefits of palm oil products.

"We will conduct palm oil familiarisation programmes for the Chinese government and industry members to enhance the positive image of palm oil," says Utama Shahrir bin Abdul Samad, MPOB chairman.

Exports of Malaysian palm oil to the mainland increased from 1.84 million tonnes in 2002 to 3.98 million tonnes last year. Working towards stronger trade relations and collaborative research and development opportunities, MPOB sees PORTSIM as a venue towards a lasting relationship with the mainland.

Accounting for 37.7 per cent of world palm oil production and 47 per cent of global exports, Malaysia is a major player in the industry worldwide. With a recorded national gross domestic product contribution of 3.3 per cent and an agricultural GDP contribution of 32.8 per cent, the palm oil industry is the backbone of Malaysia's economic and social development. The industry is instrumental in alleviating poverty in Malaysia, providing employment to more than 600,000 people.

Malaysia's palm oil industry is one of the most efficient, productive and sustainable agricultural activities in the world. The oil palm is a crop that continuously produces oil for 20 to 25 years, after which it is replanted as the yield drops. The high yield of oil palm is 10 times more than soybean and almost six times that of rapeseed. Because of its high-yielding nature, oil palm contributes 38 per cent to global oil production.

Given that the palm oil industry is one of Malaysia's most important economic lifelines, MPOB aims to ensure the sustainability of the industry. "MPOB has developed codes of practice that cover the entire palm oil supply chain incorporating elements of sustainability and food safety. This is to ensure the production of sustainable, environmentally friendly and food-safe palm oil for consumers worldwide," Samad says.

Exploring new uses for palm oil is a way to add value to the industry. Under MPOB's guidance, the industry ventures into downstream applications and diversified niche businesses in palm oil and its by-products. Areas which hold potential for Malaysia's palm oil industry are oleo-chemicals, biomass, biodiesel, food and phytonutrients.



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