PALM OIL HIGHLY SOUGHT GLOBALLY DUE TO CHRONIC SHORTAGE

By Mohd Iswandi Kasan Anuar

KUALA LUMPUR, March 12 (Bernama) -- Expanding economies and rising
population leading to a chronic shortage of oil and fats will continue to make
Malaysia palm oil a highly sought after edible oil in the global arena.

Although palm oil accounts for 34 per cent of the global output of 160
million tonnes oil and fats, it is stil not enough to meet the high demand from
importers, said Malaysian Palm Oil Council (MPOC) Chief Executive Officer Dr
Yusof Basiron.

He said the situation was made more acute by the fact that the only other
major producers besides Malaysia was Indonesia followed by Argentina at a
distant third to serve world oils and fats demand especially from the food
sector.

"Palm oil is occupying a very dominant role in the consumption of edible
oils in the world, the world is short of edible oils," he told a roundtable
discussion on palm oil industry hosted by Bernama.

It was moderated by Bernama Editor-in-Chief Yong Soo Heong, Salbiah Said,
Bernama Deputy Editor-in-Chief in-charge of Bernama Economic Service and Siti
Hawa Othman, an Assistant Editor with Bernama Economic Service.

Dr Yusof said almost 80 per cent of the country's palm oil output was
exported and dedicated for serving the food industry in making margarine,
shortening, fat cooking, while another 20 per cent have been diverted for oleo
chemical or non-food use.

"It is the major economic sector of our country and main export earner.
Last year, we raised RM50 billion (in revenue and this year, I want to suggest
more than RM50 billion (uS$14.7 billion) probably RM55 (US$14.7 billion-RM60
billion (US$17.6 billion) as the price was likely to be higher as shown in the
first two months.

"Last year, we produced 17.5 million tonnes and we are anticipating
anywhere within that figure to 18 million tonnes this year," he said.

Dr Yusof said MPOC was aware of the huge multiplier effect contributed by
the industry in terms of employment, where almost half a million people were
working in the industry, but there were still labour shortages in areas such as
harvesting and other related activities.

He said additional workforce was required to run downstream processing
industries as the council regarded oil palm as a multi-commodity industry.

From palm oil, the industry produces palm kernel oil and palm kernel cake,
which are different oils, along with a different market and applications and
then there are other industries like oleo-chemicals which export soap, makes
detergents and bio-diesel.

"The new industries coming in include biomass and methane to make
electricity which can be connected to the national grid. Now, we are beginning
to harvest the oil palm trees and trunks for furniture, exporting to more than
70 countries," Dr Yusof said.

Currently, there are 600 million oil palm trees in the country that could
be harvested and converted into fibre products including medium density fibre
boards as well as pulp and paper which are now beginning to be popular.

"Put all this together, palm oil is a very important and vibrant industry,
which makes a lot of money for the country and makes us probably prosperous,
which is a contribution from the agriculture sector no doubt," he said.
-- BERNAMA