Regional expansion new direction for crude palm oil - Khairuddin

KUALA LUMPUR, March 24  -- Demand for crude palm oil (CPO) in the regional markets has been increasing and this has the potential to be expanded further, said Minister of Plantation Industries and Commodities Datuk Dr Mohd Khairuddin Aman Razali. 

He said it is timely for Malaysia to divert its focus and set a new direction towards these potential regional markets to increase the export earnings for Malaysia's palm oil and palm based products.

"It would be sufficient if we market our palm oil to the regional markets, actually. Malaysia has a stock of 19 million tonnes only, and our oil is premium (grade), produced from the best seeds compared with the seeds used by other countries. 

"Demand is growing but supply is insufficient, hence if we market in the region, the market size is already huge, with many countries showing interest to get supplies from us," the minister said when appearing as a guest on 'Bicara Naratif' talk show on RTM1, themed 'One-year Malaysia Prihatin: Achievements of the Ministry of Plantation Industries and Commodities (MPIC) last night.

Khairuddin said Malaysia is currently implementing an offensive strategy in marketing the CPO by creating new markets and not depend on existing markets.

"We have opened markets in Africa and the Middle East to expand our markets, and after one year, we saw that through the Prime Minister's visit to Saudi Arabia recently, the Kingdom has pledged to increase its imports (of pam oil) to 500,000 tonnes annually, valued at RM1.7 billion. 

"Around July (2021), we will officiate our regional office in Jeddah (Saudi Arabia) which will merge three main sectors, namely palm, rubber, and wood-based covering three key agencies; Malaysian Palm Oil Council, Malaysian Rubber Council (MRC), and Malaysian Timber Council. 

"These three sectors will merge to make Jeddah as a commodity hub for marketing to the Middle East and Africa," he said.

Meanwhile, Khairuddin said MPIC would implement the Rubber Industries Transformation (TARGET) programme which will give value-add to the rubber smallholders.

"We want to encourage the rubber smallholders to get involved with cooperatives which will become the body or group that will restructure the business, work culture, as well as rubber production process to increase efficiency in the sector. 

"Through well-managed cooperatives, the government can help in getting machines that can assess dry rubber content more accurately and produce rubber crip instead of rubber scrap which will give value-add. 

"The ministry through the Malaysian Rubber Board and with the cooperation of the MRC has set aside RM6 million funds for grants to procure machines worth RM300,000 to produce rubber crip, targeting 20 cooperatives at the initial stage," said Khairuddin. 

-- BERNAMA