The Palm Oil Industry

New Books on Palm Oil

2011-07-26T20:22:00.000-07:00

Oil Palm: Cultivation, Production and Dietary Components

Cultivation of the oil palm (Elaeis guineensis Jacq) has expanded tremendously in recent years such that it has now become a major source of the world supply of vegetable oil, and is one of the most important tree crops in the humid tropics, with its main centre of production in Southeast Asia. Oil palm is the world's most productive oil crop and is, in addition very versatile, producing two distinct oils, mescocarp (palm) oil and palm kernel oil, which find a variety of food and non-food applications as fertilisers, soil conditioners and as a source of fuel. This book presents topical research data in the study of oil palm, including the potential of gas chromatography fingerprinting of palm oi l; palm oil in the implication of cardiovascular disease; the integral use of palm oil in the production of biodiesel fuel; and, oil palm biomass and its applications.

Click here to preorder Oil Palm: Cultivation, Production and Dietary Components

Handbook Of Industrial Crops (Food Products Series)

A handy guide on crops of international importance The Handbook of Industrial Crops is a comprehensive exploration of 12 important agricultural components of economy and export trade. The book examines the aspects of cultivation and trade in addition to the available information on the evolution and adaptation of each agricultural crop. With this extensive resource, you get detailed, up-to-date information on each species’ origin and botany, cultivation and harvest, and prospective future of available production and demand to set you up for higher production and sales.

Click here to order : Handbook Of Industrial Crops (Food Products Series)

Other Books (Click the image below)

Palm Oil Processing Books

2011-07-25T00:46:00.000-07:00

Title:Small-Scale Palm Oil Processing in Africa (Fao Agricultural Services Bulletin,)
Author: Kwasi Poku FAO Consultant Ghana

Publisher: Food & Agriculture Organization of the UN (FAO)
Language: English
Year: 2002
Internet Version: http://www.fao.org/DOCREP/005/Y4355E/Y4355E00.HTM

Sarawak Oil Palm Plantation Owners Association (SOPPOA) change of address

2011-05-16T01:41:00.001-07:00

The address of Sarawak Oil Palm Plantation Owners Association has changed from

No. 147, 3rd Floor, Kampong Nyabor Rd,

96000 Sibu, Sarawak, Malaysia

to the new address

Sarawak Oil Palm Plantation Owners Association (SOPPOA)

No. 30, 2nd Floor, Travilion Cemmercial Centre

93100 Kuching, Sarawak.

Tel: 082-236872, Fak: 082-236873

Brief Information:

Email: soppoa@gmail.com

Country: Malaysia

Contact Person: Philip Ho Kian Sin

Designation: Secretary

RSPO Membership Number: 8-0111-10-000-00

Primary Nomination of Representative

Name: Datuk Abdul Hamed Bin Hj Sepawi

Designation: Chairman

Telephone: +6-084-237533

Secondary Nomination of Representative

Name:Paul Wong Hee Kwong

Designation:1st Vice-Chairman

Brief Profile:

Sarawak Oil Palm Plantation Owners Association (SOPPOA) is a newly formed association representing Sarawak Oil Palm Plantation Owners in Sarawak with the objectives among others are to promote cordial working relation between owners and all relevant parties and also collectively address issues pertaining to oil palm industry in Sarawak.

SOPPOA was officially incepted on 11th December 2008 in RSPO and since then have been in a close working relation with the Ministry of Plantation Industry and Commodities Malaysia, Malaysia Palm Oil Board and Department of Environment through dialogs as well as correspondences updates.

Sarawak

Wilmar Expands in Europe With Palm-Oil Refining, Alcohol Plant

2011-05-10T19:38:00.000-07:00

10/05/2011 (Bloomberg) - Wilmar International Ltd. (WIL), the world’s biggest palm-oil producer, will partner with a rival to refine and sell cooking oil in Europe, seeking to ease its reliance on China.

Wilmar, based in Singapore, will supply refined palm oil from New Britain Palm Oil Ltd. (NBPO)’s farms in Papua New Guinea and the Solomon Islands, the two companies said in a statement today. Separately, Wilmar said it also plans to build a natural-alcohol plant in the Netherlands.

The European expansion comes after more than six months of Wilmar being told by the government in China, its biggest market, to cap cooking oil prices to rein in food inflation. Wilmar’s oilseed and grains unit posted a $173.2 million loss last year mostly because of the caps, which made retail oil cheaper than bulk.

“Wilmar’s always been interested in expanding its presence in Europe and this certified oil is a step forward,” said Ben Santoso, an analyst with DBS Vickers Securities Pte. “Europe needs an alternative to rapeseed oil.”

Wilmar rose 0.6 percent to S$5.15 at the end of trading in Singapore. The stock has declined 8.5 percent this year, compared with a 1.7 percent drop in the key Straits Times Index.

Biggest Market

Europe accounted for 7.2 percent of Wilmar’s $30.4 billion in sales last year, while China contributed 52 percent. Wilmar also refines sugar and has its own palm plantations, as well as a biodiesel manufacturing business.

“We look forward to being more involved in the local chemical community and strengthening our foothold in Europe,” Wilmar Chief Executive Officer and Chairman Kuok Khoon Hong said today in the statement, referring to the alcohol plant.

According to Wilmar’s partnership with New Britain, oil- palm fruits grown at the London-listed company’s certified sustainable plantations will be processed by Wilmar in Germany and jointly marketed. Wilmar’s plant in Germany will begin palm oil refining from the middle of next year, producing as much as 300,000 metric tons of the product per year.

Europe each year buys about 5 million tons of palm oil, which is used to make bread, cereals, margarine and lipstick, Wilmar said.

The company’s natural alcohol plant will be built near the port of Rotterdam jointly with Salt Lake City, U.S.-based Huntsman Corp. (HUN), it said in a statement today. The factory is due to come on stream in 2013.

Europe Palm Oil Market

Southeast Asian Palm Oil Firms Go on African Land

2011-05-04T22:58:00.000-07:00

03/05/2011 (Reuters) - Southeast Asian palm oil firms are turning to Africa as land runs out back home and world demand for cheap cooking oil soars, but the continent's harsh weather, high costs and land disputes could derail their plans.

Malaysia's Sime Darby and Singapore's Golden Agri Resources have joined a slew of global firms entering Africa by snapping up hundreds of thousands of hectares of land in Liberia, but it could still take years to turn the region into a net exporter and help ease high palm oil prices.

With an increasing number of firms rushing to Africa as part of a global grab for land in the face of soaring food prices, African governments such as Nigeria and Tanzania have also thrown open their doors to planters by offering tax breaks and big land concessions.

But a lack of clear land titles, poor margins and weak yields could turn out to be massive stumbling blocks.

"Africa is not a dream continent for palm oil. We have been here for 30 years and we get on by with small profits," said Gert Vandersmissen, director of operations in Gabon for Belgium's Siat Group. "The costs can be high."

But with Malaysia and Indonesia, which together account for 85 percent of the world's palm oil output, likely to run out of land soon, the two Southeast Asian countries don't have many alternatives.

Nomura said in a recent note that strict environmental rules will see both Southeast Asian countries run out of land by 2020-2022, a century after colonial planters introduced oil palms to the region.

RUNNING OUT

Top palm producer Indonesia is preparing for a forest clearing ban this year as part of a $1 billion climate change deal with Norway, and No.2 supplier Malaysia has used up nearly all its land.

At the same time, the world faces a supply deficit of palm oil -- used in a range of products from biscuits and shampoo to biofuels -- that may exceed 246,000 tonnes in the current marketing year to September, according to U.S. Department of Agriculture data.

Malaysian palm oil futures, the benchmark for the market, are forecast to average a record $1,114 this year.

The potential to ramp up output by tapping Africa is huge.

World Bank studies show Sub-Saharan Africa holds 201.5 million hectares suitable for crops, nearly half the world's total, or 16 times the combined oil palm acreage in Indonesia and Malaysia.

Unlocking Africa's land at a pace of 1 million hectares a year over two decades could boost its output to 38 million tonnes from 1.9 million tonnes in 2010, Reuters calculations based on Food and Agriculture Organisation (FAO) data showed.

That could turn Africa into a major net exporter. Last year, the continent imported 3 million tonnes, an increase of 15 percent, according to Malaysian Palm Oil Council.

"Those who have announced their expansion into Africa, for example, Sime Darby ... are only looking for first mover's advantage," said Citigroup analyst Penny Yaw in Malaysia.

Golden Agri Resources, Singapore's second largest palm oil firm, plans to invest in Liberia-based Golden Veroleum, which has signed a $1.6 billion deal with the government of Liberia for a 500,000 acre estate in the southeast of the country.

The world's largest listed planter by land holdings, Sime Darby, has a 220,000 hectare concession in Liberia. It started planting this year with first maturity expected after the fourth year of planting.

BUT IS IT ALL WORTH IT?

Investors are often lured by the fact that land in Africa can be rented or bought at a fraction of the price in Malaysia, where estates are priced at $6,000 to $7,000 per hectare, but there are other hidden costs.

Projects can get delayed if deals between land-hunting firms and African states do not ensure local people in the world's hungriest continent reap any benefit, leaving the door open to potential social tension.

Compensation and mapping of land rights can also be expensive, adding to production costs which range between $600 to $800 for a tonne of palm oil in Africa compared to around $300 in Asia, a survey of five planters in Africa showed.

"Some might argue that shipping from Africa to Europe can reduce costs but it's not enough," said a planter in Ghana. "For every advantage there is a cost. Labour is cheap but it takes time to teach them and this leads to lower productivity."

There are other disadvantages such as low yields.

Estates in Africa's top grower, Nigeria, yield about a tenth of Malaysia's 21.3 tonnes of fresh fruit bunches a hectare, FAO data shows, due to poor planting materials and the region's long dry season that stresses out water-loving oil palms.

Despite these problems, there is opportunity in Africa.

The World Bank in April lifted an 18-month ban on lending to palm oil on social and environment concerns to focus on financing projects that help small farmers -- a move that may help spur expansion.

Malaysia's state-linked FELDA Global Group, the world's largest palm estate operator, wants to replicate its smallholder co-operative model in Africa and sell planting materials and technical expertise in exchange for long-term supplies.

"Buying land in Africa is tricky and we prefer to cater to government requests to start up the FELDA model. We have one project in Sierra Leone," said FELDA Global Group President Sabri Ahmad. "We can be the palm oil salesman in Africa."

Africa Cooking Oil

Making Sense Of Fats For Cooking And Food Preparation

2011-04-27T23:51:00.000-07:00

27/04/2011 (HealthNewsDigest.com) - By now, you know that you should be avoiding trans fats. As food manufacturers re-formulate their brands to replace trans fats with other alternatives, it’s easy to become confused when you read the new food labels. Saturated, unsaturated, monounsaturated, polyunsaturated? Olive, canola, soy, Malaysian palm fruit oil, palm kernel oil, coconut oil or animal fats (beef tallow, lard) – which are the healthier choices? The answers may surprise you.

Did you know that the fats you eat can raise your cholesterol? Or that nutritionally, Malaysian palm fruit oil may be as healthful as olive oil? “It is exciting to learn that there are options for oils on the market that provide a nice alternative to butter or even olive oil – which isn’t always appropriate for all types of cooking,” comments Registered Dietician, Nutritional Consultant and Author Felicia Stoler. “For example, red Malaysian palm fruit oil contains both beta-carotene and vitamin E. While that doesn’t mean you should eat large amounts of chicken wings fried with it, it is reassuring to know that when you cook or bake with it, it will taste great, it won’t raise your cholesterol and it delivered beneficial nutrients.”

Palm fruit oil vs. Palm Kernel Oil: Read the food labels carefully!

Don’t confuse palm fruit oil with the much maligned palm kernel oil that was once widely used in movie popcorn. Cultivated in Malaysia, natural Palm fruit oil comes from the plant’s fruit (the fleshy part) and contains numerous micronutrients. Numerous studies have confirmed the nutritional value of palm fruit oil make it as healthful as olive oil.

In contrast, palm kernel oil comes from the plant’s kernel (seed). It contains about 85 percent saturated fats which can raise your cholesterol levels. So it’s best to think carefully before consuming it as a major part of your dietary fat intake.

Almost 90 percent of the world’s palm fruit oil is used as food. In fact, palm fruit oil is the second largest edible oil consumed, accounting for almost one quarter of the world's fats and oil supply. Foods made with palm fruit oil, which is naturally trans fat-free (a claim also shared with olive oil), have a long shelf life and other desirable properties including great texture and flavor. Palm fruit oil also is very affordable.

What makes palm fruit oil so good? It contains almost equal amounts of unsaturated fats and saturated fats, (mainly palmitic and smaller amounts of stearic acids). As a result of its unique balanced composition, palm fruit oil has almost no impact on your cholesterol as long as your total dietary fat intake is in line with the levels recommended by health agencies such as the American Heart Association. Basically it behaves more like a healthier monounsaturated fat (the type of fat found in nuts, canola and olive oil) than a saturated fat. The virgin and red varieties of palm fruit oil are also rich in powerful antioxidants called tocotrienol and tocopherols (vitamin E), as well as carotenes (vitamin A).

Cooking with palm fruit oil

Olive oil is healthful and is ideal for sautéing and savory baking, but its flavor isn’t suited for many recipes and it is best used at lower temperatures. Butter also burns easily. “It’s very hard for a novice cook to know what the actual temperature is in a pan. Palm fruit oil is chef-friendly because it is very stable and is great for high heat cooking.

“Palm fruit oil can easily be substituted for solid fats such as butter, margarine or shortening, and is delicious when used for cooking and baking. Palm fruit oil or olive oil can also be blended with a small amount of butter if you want the buttery flavor when cooking at higher temperatures or baking.”

Natural palm fruit oil is better for the environment

Some food manufacturers and suppliers have begun using highly-processed, genetically-modified oils to replace trans fat in their products. “For those of us who prefer natural, unprocessed foods, Malaysian palm fruit oil is the obvious and smartest choice,” says Stoler. “The Malaysian oil palm growers are the leaders in environmentally-sensitive cultivation programs. Theirs is a premium product that is good for the environment and good for your health.

“As a dietician, I also understand that your family won’t eat something that doesn’t taste good. Malaysian palm fruit oil is the gold standard of palm oils. As with any oil, moderation is still important. Don’t make the mistake of thinking if a little is good, a lot is better. No one is recommending that you eat it in large quantities, and Malaysian palm fruit oil won’t make poor food choices better.

“But when you make the choice to eat products made with Malaysian palm fruit oil, or to cook with it in your own kitchen, you never have to worry about the flavor.”

Sidebar: Fat Facts

Malaysian palm fruit oil: All-natural and naturally trans-fat free. It contains almost equal amounts of unsaturated fats and saturated fats, (mainly palmitic and smaller amounts of stearic acids). In the body, it behaves more like a monounsaturated fat. It has virtually no adverse impact on your cholesterol levels. Comparable nutritionally to olive oil, it can be used for cooking at higher temperatures than olive oil and is ideal for those cooking applications when you don’t want the flavor of olive oil.

Monosaturated fats: Lower total cholesterol and LDL (bad) cholesterol while increasing the HDL (good) cholesterol. Found abundantly in avocados, nuts, olive oil and liquid palm fruit oil (called palm olein).

Polyunsaturated fats: Lower total cholesterol and LDL (bad) cholesterol while increasing the HDL (good) cholesterol. Found in all vegetable oils, abundant in corn oil and sunflower oil. Omega 3 fatty acids in fish oil are an example.

Saturated fats: Raise total cholesterol as well as LDL (bad) cholesterol. Found abundantly in animal products such as beef and pork as well as palm kernel oil and coconut oil.

Trans fats: Raise LDL (bad) cholesterol and lower HDL (good) cholesterol. Also adversely raise a number of disease-related risk factors. Still found in many processed foods such as French fries and baked goods.

Red Malaysian palm fruit oil

RSPO: Labeling Palm Oil As An Ingredient Is Fine, Provided Other Oils Are Labeled Too

2011-04-24T21:00:00.000-07:00

22/04/2011 (Mongabay.com) - The Roundtable on Sustainable Palm Oil (RSPO), a body that sets criteria for social and environmental certification of palm oil, weighed in on the debate over Australia's proposal to require listing of palm oil as an ingredient on package labels. At the same time, the RSPO announced its own labeling initiative to distinguish products that use RSPO-certified palm oil from those that do not.

Darrel Webber, Secretary General of the RSPO, said that if the purpose of the bill is to encourage the adoption of "greener" palm oil, rather than discourage use of all palm oil, the RSPO supports the bill. But he added truth-in-labeling should apply to all vegetable oils.

"Distinguishing palm oil as the only edible oil that requires labeling implies that other edible oils do not face similar challenges," Webber said in a statement. "RSPO takes a strong view against this supposition as issues surrounding environmental destruction, social concerns and wildlife conservation are prevalent across the board with cultivation of any type of monoculture crops."

"Further to this, such a labeling exercise that singles out palm oil may only serve to ostracize agricultural farmers in developing countries such as Indonesia, Malaysia, Papua New Guinea, South America, West Africa, etc. whose key source of income comes from palm oil. These smallholders need to be educated, guided, encouraged and inspired to adopt sustainable standards and solutions, rather than have their livelihoods affected. RSPO certification program aims to support smallholders in this light."

Webber added that if the bill causes a shift away from palm oil, the vegetable oils that replace it would also need to be evaluated on their social and environmental performance. As the world's highest yielding oilseed, palm oil produces more oil per unit of area than any other crop. As such the palm oil industry argues its crop requires less land to produce the same amount of oil as canola/rapeseed, soy, coconut, and corn.

"The long term repercussion of this proposed Bill may decrease the demand for palm oil but will not eliminate the key reasons this proposal is aimed at addressing in the first place," he said. "This is because edible oil is a key ingredient in most consumer products. Demand would merely shift to other vegetable oils, increasing the sustainability problems connected to these other particular crops."

Webber took the opportunity to announce the RSPO trademark, which will be used on product packaging and labels which contain RSPO Certified Sustainable Palm Oil (CSPO). The label will be available later this year.

"The trademark will enable consumers to confirm very quickly that the products they buy contribute to sustainable production of palm oil," said the RSPO statement. "The trademark logo could end up on the packaging of thousands of consumer products worldwide."

Up to half of packaged products in some markets contain palm oil.

RSPO also announced record production of certified palm oil, which reached 4.7 million metric tons in the year to date, up from 2.8 million tons for all of 2010.

The RSPO

RSPO was formed in 2004 as a response to concern from environmentalists who maintain that oil palm production has driven large-scale destruction of rainforests across southeast Asia over the past two decades, triggering the release of billions of tons of carbon dioxide emissions and imperiling rare species, including the Sumatran tiger and the orangutan. RSPO has created a set of criteria to make palm oil production less damaging to the environment and local communities. These include using natural pests and composting in place of synthetic pesticides and fertilizers whenever possible, implementing no burn policies, sparing high conservation value forests from development, taking measures to reduce air pollution, and creating catchment ponds to prevent palm oil mill effluent from entering waterways where it would damage aquatic habitats. The hope is that CSPO can be sold at a premium to recoup the increased costs that certification entails.

RSPO has at times been criticized for being slow to act when members are found to be operating in violation of productions standards, but the body has recently rebuked IOI Group, a Malaysian producer, and Golden Agri Resources (GAR), a Singapore-based firm, for social and environmental transgressions. GAR has since taken steps to come back into compliance, including establishing a new forest policy.

The RSPO

World Bank Group Adopts New Approach For Investment In Palm Oil Sector

2011-04-19T20:03:00.000-07:00

11/04/2011 (MMD Newswire) - The World Bank Group today announced the adoption of a World Bank Group Framework and IFC Strategy to guide future engagement in the global palm oil sector. The new framework and strategy were developed following extensive consultations with a wide range of stakeholders including environmental and social NGOs, farmers, indigenous communities, private sector companies, and governments.

Feedback received affirmed that, when guided by rigorous environmental and social protections, the palm oil sector can be an important contributor to economic development and poverty reduction.

"Throughout the consultations," said Rachel Kyte, IFC Vice President for Business Advisory Services, "many voices in the private, public, and civil sectors recognized the potential of the palm oil production to contribute to poverty reduction when good environmental and social practices are followed. Stakeholders look to the World Bank Group to support a new model for financing in the sector to benefit the poor and protect the environment. This is what we have committed to do."

Palm oil is produced by and employs over six million rural poor worldwide. Small farmers dominate production and continue to enter the industry in increasing numbers. Some 70 percent of palm oil production is used as staple cooking oil by poor households in Asia and Africa.

"Even though the World Bank is a small player in the palm oil sector," said Inger Andersen, World Bank Vice President for Sustainable Development, "we can make a contribution to strengthening the sector's sustainability. Our focus on supporting small farmers and improving productivity - particularly that of degraded plantations - can help poor rural communities benefit while also helping the environment."

Stakeholder consultations, held around the world over the last year, focused on a range of social and environmental issues facing the palm oil sector and the role the World Bank Group could play to address them. The consultations helped to shape key areas of focus for Bank Group engagement in the sector, including:

* regulatory and governance reforms;

* responsible private investments;

* improved benefit sharing with smallholders and communities; and

* development and widespread adoption of environmentally and socially sustainable standards and codes of practice.

The World Bank Group Framework and IFC Strategy for Engagement in the Palm Oil Sector will give priority to institutional and market initiatives that support smallholders and foster benefit sharing with rural communities. This will take place by helping to strengthen smallholder producer organizations, promoting their access to finance and markets, improving their agronomy practices and productivity, and fostering fair contractual arrangements with larger companies.

To help protect forests and biodiversity and to move palm oil expansion from forested areas and peat lands, the Bank Group will give priority to initiatives that encourage production on degraded lands and seek to improve productivity of existing plantations.

The new approach also includes new analytical "tools", such as a joint World Bank-IFC Country Situation Analysis and IFC's Risk Screening and Assessment procedure. This will enable an assessment of key opportunities and risks, particularly around the issues of land use and acquisition, governance, community concerns, and working conditions. These tools will guide the Group's decisions on whether to engage, the level of appropriate engagements, and measures to avoid or reduce potential risks.

In order to develop the new engagement approach, the World Bank Group suspended its new investments in the palm oil sector in September, 2009 to review lessons learned and to consult with stakeholders. With the adoption of the new Framework and Strategy, it is now lifting that suspension.

The World Bank Group

Researching Palm Oil Crystallization in Margarine

2011-04-18T21:21:00.000-07:00

18/04/2011 (Food Product Design) - Fat crystallization is an important property in many food products, such as margarine-style spreads. To further delve into the science behind fat crystallization, Malaysian scientists examined the mechanism related to crystallization and emulsification of palm oil–based margarine fats. The researchers also looked at the main triacylglycerol (TAG) responsible for primary crystal formation and the best level of palm oil stearin that gives the required microstructure properties and body to finished products such as margarine, shortening and butter.

As hydrogenated fats have fallen out of favor due to their trans fatty-acid content, margarine manufacturers have turned to palm oil and its fractions. The major TAGs in palm oil are dipalmitoyl-oleoyl-glycerol (and dioleoyl-palmitoyl-glycerol). Dipalmitoyl-glycerol develops crystals quickly, palmitoyl-oleoyl-glycerol slows crystal formation and dioleoyl-glycerol has no effect. In addition, the TAGs crystallize in different polymorphic forms that differ from crystal to crystal by melting point and crystal structure.

The research, published in the Journal of Food Science, found that TAG composition, solid fat index (SFC), thermal behavior and microstructure properties of palm-oil-based MFs were significantly affected by blending and emulsification. The scientists combined palm oil and palm stearin in different ratios to margarine-like emulsions. They then looked at their microstructure properties and analyzed them for triacylglycerols, solid fat content (SFC) and thermal behavior.

The researchers found that blending and emulsification at palm stearin levels over 40% significantly changed the physicochemical and microstructure properties of experimental margarine fats. They found that the formation of granular crystals in the margarine fats was dominated by the high-melting triacylglycerol (dipalmitoyl-oleoyl-glycerol) and that a low level of monoacylglycerol emulsifier slowed crystallization rate.

Margarine fats

Palm Oil Processing operation

2011-04-14T09:34:00.000-07:00

Research and development work in many disciplines -biochemistry, chemical and mechanical engineering - and the establishment of plantations, which provided the opportunity for large-scale fully mechanised processing, resulted in the evolution of a sequence of processing steps designed to extract, from a harvested oil palm bunch, a high yield of a product of acceptable quality for the international edible oil trade. The oil winning process, in summary, involves the reception of fresh fruit bunches from the plantations, sterilizing and threshing of the bunches to free the palm fruit, mashing the fruit and pressing out the crude palm oil. The crude oil is further treated to purify and dry it for storage and export.

Crude Palm Oil Extraction

Large-scale plants, featuring all stages required to produce palm oil to international standards, are generally handling from 3 to 60 tonnes of FFB/hr. The large installations have mechanical handling systems (bucket and screw conveyers, pumps and pipelines) and operate continuously, depending on the availability of FFB. Boilers, fuelled by fibre and shell, produce superheated steam, used to generate electricity through turbine generators. The lower pressure steam from the turbine is used for heating purposes throughout the factory. Most processing operations are automatically controlled and routine sampling and analysis by process control laboratories ensure smooth, efficient operation. Although such large installations are capital intensive, extraction rates of 23 - 24 percent palm oil per bunch can be achieved from good quality Tenera (DxP).

Conversion of crude palm oil to refined oil involves removal of the products of hydrolysis and oxidation, colour, odor and flavour. After refining, the oil may be separated (fractionated) into liquid (olein) and solid phases (stearin) by thermo-mechanical means (controlled cooling, crystallization, and filtering), and the liquid fraction (olein) is used extensively as a liquid cooking oil in tropical climates, competing successfully with the more expensive groundnut, corn, and sunflower oils.

Palm Kernel Extraction

Extraction of oil from the palm kernels is generally separate from palm oil extraction, and will often be carried out in mills that process other oilseeds (such as groundnuts, rapeseed, cottonseed, shea nuts or copra).

The stages in this process comprise grinding the kernels into small particles, heating (cooking), and extracting the oil using an oilseed expeller or petroleum-derived solvent. The oil (Crude Palm Kernel Oil) then requires clarification in a filter press or by sedimentation. Extraction is a well-established industry, with large numbers of international manufacturers able to offer equipment that can process from 10 kg to several tonnes per hour.

Palm oil processors of all sizes go through these unit operational stages.

They differ in the level of mechanisation of each unit operation and the interconnecting materials transfer mechanisms that make the system batch or continuous. The scale of operations differs at the level of process and product quality control that may be achieved by the method of mechanisation adopted.

The general flow diagram is as follows:

PALM OIL PROCESSING UNIT OPERATIONS

Harvesting technique and handling effects

In the early stages of fruit formation, the oil content of the fruit is very low.

As the fruit approaches maturity the formation of oil increases rapidly to about 50 percent of mesocarp weigh.

In a fresh ripe, un-bruised fruit the free fatty acid (FFA) content of the oil is below 0.3 percent.

However, in the ripe fruit the exocarp becomes soft and is more easily attacked by lipolytic enzymes, especially at the base when the fruit becomes detached from the bunch. The enzymatic attack results in an increase in the FFA of the oil through hydrolysis. Research has shown that if the fruit is bruised, the FFA in the damaged part of the fruit increases rapidly to 60 percent in an hour. There is therefore great variation in the composition and quality within the bunch, depending on how much the bunch has been bruised.

Harvesting involves the cutting of the bunch from the tree and allowing it to fall to the ground by gravity. Fruits may be damaged in the process of pruning palm fronds to expose the bunch base to facilitate bunch cutting.

As the bunch (weighing about 25 kg) falls to the ground the impact bruises the fruit. During loading and unloading of bunches into and out of transport containers there are further opportunities for the fruit to be bruised.

Sometimes trucks and push carts, unable to set bunches down gently, convey the cargo from the collection centers to the processing site. Again, tumbling the fruit bunches from the carriers is rough, resulting in bruising of the soft exocarp. In any case care should be exercised in handling the fruit to avoid excessive bruising.

One answer to the many ways in which harvesting, transportation and handling of bunches can cause fruit to be damaged is to process the fruit as early as possible after harvest, say within 48 hours. However the author believes it is better to leave the fruit to ferment for a few days before processing. Connoisseurs of good edible palm oil know that the increased FFA only adds ‘bite’ to the oil flavour. At worst, the high FFA content oil has good laxative effects. The free fatty acid content is not a quality issue for those who consume the crude oil directly, although it is for oil refiners, who have a problem with neutralization of high FFA content palm oil.

The main point of clarification is to separate the oil from its entrained impurities. The fluid coming out of the press is a mixture of palm oil, water, cell debris, fibrous material and ‘non-oily solids’. Because of the non-oily solids the mixture is very thick (viscous). Hot water is therefore added to the press output mixture to thin it. The dilution (addition of water) provides a barrier causing the heavy solids to fall to the bottom of the container while the lighter oil droplets flow through the watery mixture to the top when heat is applied to break the emulsion (oil suspended in water with the aid of gums and resins). Water is added in a ratio of 3:1. The diluted mixture is passed through a screen to remove coarse fibre.

The screened mixture is boiled from one or two hours and then allowed to settle by gravity in the large tank so that the palm oil, being lighter than water, will separate and rise to the top. The clear oil is decanted into a reception tank. This clarified oil still contains traces of water and dirt.

To prevent increasing FFA through autocatalytic hydrolysis of the oil, the moisture content of the oil must be reduced to 0.15 to 0.25 percent.

Re-heating the decanted oil in a cooking pot and carefully skimming off the dried oil from any engrained dirt removes any residual moisture. Continuous clarifiers consist of three compartments to treat the crude mixture, dry decanted oil and hold finished oil in an outer shell as a heat exchanger.

Palm OilMalaysia: Smallholders Critical Component in Nation's Oil Palm Industry

2011-04-14T07:24:00.000-07:00

14/04/2011 (The Borneo Post) - Smallholders who are responsible for 40 per cent of palm oil planted areas in the country are considered as one of the main components of the country’s palm oil industry.

As such, the BN government accorded due consideration towards the role of the smallholders, Malaysian Palm Oil Board (MPOB) chairman, Dato Seri Utama Shahrir Abdul Samad said when officiating at a Palm Oil Management Course in Saratok on Tuesday.

Special attention was accorded towards increasing the production of the quality crop which was achievable through the application of new technology and good agriculture practice.

This required the farmers to establish working relationship with MPOB’s Tunas officers, he said.

Furthermore, increasing the productivity and income of smallholder farmers was in line with the objective of the government’s Economic Transformation Programme to spearhead the country towards a high-income economy status by 2020, he pointed out.

“In that respect, eight Entry Point Projects (EPPs) ranging from upstream activities aimed at increasing production and downstream activities aimed at producing value-added products will be implemented,”

An increase in downstream activity was expected to generate an income of RM178 billion by 2020 compared to RM52.7 billion currently, he said.

The fast growth of palm oil industry in the past five decades had contributed immensely towards the country’s economic development, he said, adding, as the acreage of palm oil plantation was already 4.85 million hectares or 71 per cent of the country’s agricultural land by 2010, the industry had become the most thriving agricultural activity.

The government had also identified several strategic measures to further increase the production of palm oil, including that of the smallholders, he said.

That included cutting of old palm oil trees (aged over 25 years) to pave the way for replanting of a new high-yielding breed.

According to him, there were a total of 449,415 ha with trees aged over 25 years old throughout the country of which 109,083ha were smallholders’ and 340,332ha were plantations.

MPOB had also come with a new technology capable of increasing palm oil’s annual production to 26 ton per ha by 2020, he said, adding, for that the government had allocated a sum of about RM297 million to be utilised from this year till 2013.

In this programme, MPOB would supply seedlings and other agricultural inputs worth RM7,000 for a ha, he disclosed, adding, besides, some smallholder farmers were eligible to get RM500 monthly maintenance subsidy for a period of two years.

Shahrir, advised the palm oil farmers, especially the smallholders to get in touch with
MPOB to get the updates on every aspect of the industry.

Among those present were Deputy Minister of Transport, Jelaing Mersat, chairman of MPOB’s Integrated Research and Extension section director, Idris Omar and MPOB officers.

US Expects To Boost Economic Cooperation In Agriculture

2011-04-06T07:56:00.000-07:00

06/04/2011 (Jakarta Post) - The United States hopes to seek new business opportunities and enhance bilateral cooperation with Indonesia by sending an agribusiness, trade and investment delegation mission.

The delegation will be led by US Department of Agriculture Acting Under Secretary Michael Scuse, accompanied by representatives from 19 companies from the agricultural sector including multinational agricultural biotechnology corporation Monsanto and the world’s leading agricultural and construction equipment firm Case New Holland, in a four-day visit starting on Monday.

Scuse said on Tuesday that the US wanted to boost trade relations and investments — especially in agriculture — with Indonesia, which had showed promising economic growth.

“It is one of the Southeast Asia’s fastest growing economies, with vibrant business climate and upwardly mobile, expanding middle class providing opportunities to expand exports of US food and agricultural goods and stimulate investment,” he told a press briefing in Jakarta.

He added that, along with economic growth, Indonesia’s needs for food would rise and the US would continue to supply its high-quality and safe agricultural products.

“There’s a hope that we’ll be able to export more grains and see an increased market for beef and poultry products in Indonesia,” he said.

Meanwhile, Deputy Agriculture Minister Bayu Krisnamurti said Indonesia also asked the US to open more access to Indonesian palm oil — especially in the form of bio-fuel — and cacao.

“Currently, we are producing around 1.5 million to 2 million tons of sustainable palm oil. There’s much potential for our palm oil in the US market,” he said.

Scuse said he also offered Indonesia the latest American agricultural technology to help the former country in ensuring its food security.

Bayu said Indonesia would cooperate with the US to develop advanced agricultural technology in a bid to adjust to climate change.

“We want to build cooperation with them to develop seeds which are more resilient to extreme climate through research and development programs,” he said.

Scuse said the US also expected to double exports to Indonesia by 2014, along with increased investments.

Last year, the US’ overall export to Indonesia reached US$5.6 billion with around $2.3 billion, nearly 40 percent, contributed by food, agricultural and fish products, he said.

Meanwhile, Indonesia’s export to the US, its major export destination, was valued at $15.6 billion with about $4.1 billion coming from agricultural, fish and forest products, he added.

The US is Indonesia’s largest foreign investor after Singapore and the UK with a total investment of $930 million last year, accounting for 5.7 percent of the total investment of Rp 208.5 trillion ($23.98 billion).

Separately, Franky Widjaja, the Indonesian Chamber of Commerce and Industry deputy chairman for agribusiness, food and forestry, said Indonesia might take advantage of the technology offered by the US to boost the productivity of its crops such as rice, corn and palm oil.

He cited oil palm plantations managed by small holders, which accounted for almost 40 percent of the country’s total oil palm plantations of 7.3 million hectares, could only produce 3 tons of crude palm oil per hectare, almost half of the output of major plantations.

“Enhancing productivity is one of our big challenges,” he said.

Indonesian Agriculture

Malaysian Palm Oil Board's Director General Biography

2011-03-09T02:26:00.000-08:00

Dr. Choo Yuen May, Director General, Malaysian Palm Oil Board

Dr. Choo has undergraduate and graduate degrees from the University of Waikato in New Zealand and holds a doctorate in Chemistry from the University of Malaysia. She is a researcher and inventor of note with a focus on renewable energy and bioenergy, specifically related to palm oil. She is responsible for the development of new, efficient and green processes within the palm oil industry, including the production and evaluation of palm biofuel and B5 processed palm/oil and petroleum blends. She has researched the chemistry of palm oil components and created the processes for the production of red palm oil, palm oil, palm kernel oil and a number of palm oil by-products.

Her work in developing petroleum / palm oil blends is of particular interest and supports the Malaysian government’s initiative that, starting in 2007 all diesel sold in Malaysia must contain 5% palm oil.

She is currently the Director of the Malaysian Palm Oil Board which was established on 1st May 2000 with the objective of promoting, developing and advancing the Malaysian palm oil industry. The Malaysian Palm Oil Board is responsible for providing the scientific and technological support to the Malaysian palm oil industry, which could soon make significant inroads into the global biofuel market. Oil palm is regarded as the most cost effective vegetable oil crop with average yields of 3.5 to 5.0 tons of palm oil per hectare, per year. Thus, it offers great potential as environment-friendly alternative fuel source, and it is estimated that Malaysia will be a net importer of petroleum by 2010 as a result of its use of palm oil blends in fuel.

Name: CHOO Yuen May, Dr

Qualification/Educ.: B.Sc.; M.Sc.(Hon) Waikato, New Zealand; Ph.D.Malaya; A.M.I.C.

Expertise/Specialization:

Chemistry and technology of palm-based products and minor components in particular oleochemicals and carotenes

Experience:

1980-1982 Lecturer, University Sains Malaysia

1982- Research Officer, PORIM

1993- Research Group Leader, Processing Group, PORIM

2004- Director, Engineering and Processing Division, MPOB

2010- Director General, MPOB

Membership/Affiliation:

1. Council Member, Malaysian Invention & Design Society(MINDS)

2. Chairperson, LADYMINDS

3. Associate Member, Malaysian Institute of Chemistry

4. Council Member, Malaysian Oil Science and Technology Association (MOSTA)

5. Member, Nutrition Society of Malaysia

Honours/Awards:

1. Malaysia National Young Scientist Award 1989

2. MINDS and PORIM Research and Excellent Service Awards 1989,1990, 1992, 1993, 1994

3. International Federation of Inventors Association (IFIA) Cup for Outstanding Malaysian Women Inventor/National Women Inventor Award 1993

4. WIPO (World Intellectual Property Organization) Gold Medal for Best Women Inventor at 22nd International Exhibition of Inventions, Geneva, Switzerland, April 1994

5. Gold Medal and four Gold Award Certificates at 22nd International Exhibition of Inventions, Geneva, Switzerland for production of monoglycerides, alkyl esters, carotene-enriched red palm oil and palm carotene concentrate

Official Address:

MPOB,

No 6, Persiaran Institusi, Bangi,

43000 Kajang, Selangor,

Malaysia

Telephone: +603-89259155/775

Fax(Off): +603-89259446

E-Mail: choo@mpob.gov.my

WebSite: http://mpob.gov.my

Leisure Interests: Reading, Music, Swimming

Malaysian Palm Oil Board

Palm oil giant Sime Darby ventures into Africa

2011-02-01T23:48:00.000-08:00

26/01/2011 (AFP), Kuala Lumpur – Malaysia's Sime Darby, the world's largest listed palm oil producer, said Wednesday it will make its first foray into Africa, with plans to establish plantations in Liberia in April.

The company, which was granted a 63-year concession in 2009 to develop 220,000 hectares (543,500 acres) of land in the west African country, will begin planting oil palm on 10,000 hectares in the first phase.

"This foray is most significant as it allows us to explore opportunities for further growth and development in other emerging markets and regions," said Franki Anthony Dass, executive vice-president of Sime Darby Plantation.

Sime Darby, which already has palm oil plantations in Malaysia and Indonesia, will invest 70 million ringgit ($23 million) in the project, Dass added in a statement.

With question marks hanging over the conduct of other Malaysian palm oil firms, the company vowed to uphold sustainable practices.

"Sime Darby Plantation is a responsible player in the industry, committed to sustainable development and our venture into Africa allows us to introduce our best practices in a region where we are starting fresh," said Dass.

Palm oil, which is used extensively as biofuel and for making processed foods and toiletries, has been vilified by environmentalists for causing deforestation and threatening species such as orangutans and rhinos.

Malaysian palm oil giants such as IOI Group, United Plantations and KL Kepong Holdings also have palm oil plantations in neighbouring Indonesia.

IOI was accused by an environmental group last year for unsustainable plantation activities in West Kalimantan in Indonesia, but the firm has vehemently denied the claims.

Indonesia and Malaysia are the world's top two palm oil exporters and account for 85 percent of global production.

Sime Darby is Malaysia's second-largest company by value, with a market capitalisation of 47 billion ringgit. It owns more than 5,000 square kilometres (1,930 square miles) of palm oil plantations in Malaysia and Indonesia.

Palm Oil Africa

Red Palm oil and carotenes help protect against cancer

2011-01-13T00:06:00.000-08:00

Extra virgin red palm oil is not only a rich source of beta-carotene, but a whole range of carotenoids. Red palm oil is the richest natural vegetable source of carotenes (carotenoids). This means that red palm oil contains 10 to 15 times more carotenes than carrots and 50 times more than tomatoes. The positive effects of carotenes on cancer have been demonstrated in numerous studies. (160) (161) (162). There are up to 600 carotenoids, and in red palm oil a broad spectrum of the former is present, such as lycopene, lutein, zeaxanthine, cryptoxanthine, alpha and beta carotene, which are among the most important.

Alpha and beta-carotene, lutein and zeaxanthine are extremely important for the eyes, alpha-carotene helps the immune system, lycopene protects from prostate cancer...
Researchers have discovered that a complex of different carotenoids has a much stronger impact on our body than when we would limit ourselves to the corresponding dose of beta-carotene. Lycopene for example will protect better against oxygen oxidation than lycopene alone. (136) The long-term administering of a supplement of one isolated synthetic carotene instead of the whole of the carotenoids can sometimes damage our health rather than benefi t it. That is why the carotenes from red palm oil are a good choice, because this oil contains a unique spectrum of different carotenes. The whole always works better than an isolated element!

Carotenes provide red palm oil with several health benefits

Carotenoids or carotenes are a group of 600 different vegetable nutrients, which protect plants, and after intake by humans, as well as human skin and the human brain. Different carotenes have a strong antioxidant function, which can prevent, limit or even repair the damage caused by free radicals. Moreover the molecules of beta carotene are an excellent foundation for producing vitamin A in the body; sometimes beta-carotene is also referred to as ‘provitamin A’. The protective function of carotenes is huge:

1. Help protect against cancer
The carotenes in red palm oil reduce the risk of hormone-dependent breast cancers. (175) Alfa-carotene showed a higher potency than beta-carotene in the suppression of cancerous growth. (176)

Alpha-carotene and lycopene, which are both present in red palm oil, significantly reduce the risk of lung cancer. Beta-carotene, lutein and beta-cryptoxanthine did so too, but significantly less. (177) Alpha-carotene, and to a lesser extent beta-carotene, reduced the risk of lung cancer in mice. The higher the intake of alpha-carotene, the less human cancer cells were able to grown in lab tests. (178) The risk of breast cancer increases when the levels of beta-carotene, lutein, alpha-carotene and beta-cryptoxanthine in the blood decrease. (179) Carotenes can help protect against breast cancer. Indian women suffering from breast cancer have low levels of beta-carotene, zeaxanthine and lutein. (180) Cancer is also caused by the damage by free radicals to the DNA and RNA of the body’s cells.

Alpha-carotene protects the cellular membranes better than carotene from carcinogenic free radicals. (134) Animals that have sufficient levels of beta-caro- tene will not get cancer, even when injected with cancer cells. Lycopene can reduce the risk of prostate cancer by 45% if supplied through food (such as tomatoes and red palm oil). Men with the highest levels of different carotenes in their blood also have 36% less chance of having heart attacks or dying prematurely. Researchers dis covered that smokers with the highest level of mixed carotenes in their blood had the lowest risk of contracting lung cancer. 127) Dr. F. Chytill of the Vanderbilt University states: ‘The knowledge that we have about vitamin A (beta-carotene) opens new per spectives in cancer therapy. The body has the opportunity to repair damaged cells. We have evidence from lab research that cancers such as skin, breast and lung tumours can be halted by a treatment using vitamin A (beta-carotene). (126)

2. Protection of the mucous membranes of the airways

Professor Keramat Ali of the University of Dacca, Bangladesh, has demonstrated that the health of children, suffering from infections of the airways, diarrhoea and other intestinal problems, improved when fed crackers with red palm oil every day. Dur- ing the period that they ate these crackers, they suffered significantly less infections of the airways and intestines. (167) Children with beta-carotene shortages (vitamin A) tended to develop respiratory problems and diarrhoea quicker. (125) Moreover it is worth noting that red palm oil con- tains a lot of palmitic acid and this is the most im- portant fatty acid for a good functioning of the lung alveoli. Suffi cient levels of palmitic acid ensure that you can breathe better during heavy efforts, because it helps the lung alveoli unfold and thus prevents them from collapsing. Palmitic acid also contributes to less surface tension on the lung alveoli.

3. Protection against cardiovascular disease

Antioxidants also help prevent cardiovascular disease. This occurs in three steps. First the carotenes and the vitamin E ensure that the ‘good’ HDL cholesterol in the body rises.

Secondly they ensure that the bad LDL cholesterol goes down. And finally they ensure that there is no oxidation of LDL cholesterol (bad cholesterol hardens as a result of oxidation), which is an essential step in the obstruction of the aorta. In a study, in which 1899 men with a diet rich in fats were surveyed, researchers arrived at the conclusion that those with the highest levels of carotenes in their blood, had 36% less risk of contracting cardiovascular disease. ( 138) Dr. David Kritchevsky of the Wister Institute in Philadelphia (US) has demonstrated that when consuming red palm oil the risk of atherosclerosis is lowest in comparison with refi ned, bleached and deodorized palm oil. The protection against atherosclerosis is a result of the high levels of antioxi- dants in red palm oil, specifi cally red carotenes and tocotrienols. (168) The risk of atherosclerosis reduces as the levels of alpha-carotene intake increase. (137) The Harvard Medical School conducted a ten-year study among 22,000 GPs and established that those who took supplements containing beta-carotenes run 50% less risk of heart attacks and CVAs. (127)

4. Protecting the eyes and skins

Not only do we need carotenes in the struggle against muscular dystrophy (the age-related regression of our vision), they also protect our body against ultraviolet radiation, according to Dr. Traber of Berkeley, California. (146)(148)(150)

Tocotrienols especially have a tumour-stopping function in the body and can be used positively in the battle against (skin) cancer. (147) (149) When the skin is burnt by the sun, the damage can be reduced by consuming mixed carotenoids. Carotenoids protect the skin against the free radicals generated by the rays of the sun in the skin (122); carotenoids in red palm oil prevent the peroxidation of the fatty acids in the skin. (134)

Attention: Carotene supplements are not the same, nor do they have the same function as the natural carotenes of red palm oil

Firstly: The structure of natural carotenes is completely different than that of chemical carotenes. Often chemical carotenes, which are used in supplements, consist of 100% beta-carotene transisomers. These can harm our health. A study conducted among smokers clearly demonstrated this. Taking such synthetic carotenes signifi cant ly increased the risk of lung cancer in smokers. Secondly: Studies have demonstrated suffi ciently that a complex of different carotenes like in red palm oil works better than if we simply limit ourselves to 1 type of carotenoid.

The carotenes in red palm oil are properly absorbed

Research conducted in Burkina Faso among mothers and children showed that this population had 40% less risk of a vitamin A shortage after cooking with red palm oil for a year. (1). Another study by the National Nutrition Institute of Hyderabad in India has demon strated that the beta-carotene serum values improved considerably in schoolchildren who took 5 ml of red palm oil a day. (145) Dr. Canefield of the University of Arizona in the US discovered that mothers who nursed their babies provided their babies with more vitamin A and carotenes by pre- paring their food with red palm oil than the control group which took beta-carotene capsules.

Many researchers have demonstrated that chemical beta-carotene in supplements does not have the same effect as the natural beta-carotene. Beta-carotene in plants is always accompanied by a diversity of carotenes such as lutein, alpha-carotene, zeaxanthine, cryptoxanthine, etc. Together they work perfectly, individually they don’t always. (126)

Carotenoids

Dealers unsung heroes in palm oil supply chain

2010-12-22T19:55:00.000-08:00

FFB dealers are vital as they address the major logistical issue of transporting a steady supply of quality FFBs from the plantations to the mills. — Reuters

WHILE planters and palm oil millers are often seen as key players in the production of crude palm oil (CPO), licensed dealers of oil palm fresh fruit bunches (FFB) are in fact the unsung heroes in the entire palm oil supply chain.

The existence of FFB dealers is vital as they address the major logistical issue of transporting a steady supply of quality FFBs from the plantations to the mills.

To ensure the oil palm sector stays well regulated, the Malaysian Palm Oil Board (MPOB) has strictly imposed the MPOB grading manual which millers need to adopt when receiving the FFB from suppliers, namely the plantations, smallholders and licensed FFB dealers.

Given such a strict grading system, recent claims by some independent millers that FFB dealers have been providing them with low quality or unripe FFB are mostly unfounded.

The quality of the FFB depends on growers, and never with FFB dealers, according to experienced planter Mahbob Abdullah.

Some growers cut unripe bunches because it makes for easier collection without many loose fruits to be picked up. He does not care about the oil extraction rate (OER) as he gets payment earlier.

Some smallholders also do not understand the amount of loss incurred by cutting unripe bunches. The oil is not yet formed fully. Where the grower leaves it to the harvester, a lack of supervision adds to the problem. However, the MPOB is doing a good job providing training to smallholders, but more training and guidance will be needed.

To lay the blame squarely on FFB dealers is also not acceptable as the failure to produce quality CPO owes to a large extent the performance of some independent millers and bad weather. Millers are prohibited from accepting unripe black bunches and are at liberty to reject any FFB which are unripe or poor in quality.

Having said that, it has been a normal and accepted practice for most millers to make a calculated tonnage deduction for less-than- good quality FFB in accordance with the grading manual.

FFB dealers also do not have the luxury of retaining the FFB for a duration of more than 24 hours as millers would and most likely refuse acceptance or make tonnage deductions.

Suffice to say, the economic repercussions would be gross and extensive to the FFB dealers!

Some independent millers have been observed to operate inefficiently as a result of poor housekeeping, high breakdown duration and a backlog of FFB dumping.

Another point is that millers cannot complain how dealers get their fruits. The dealers will go all out to get volume, and will pay competitively, even to small estates which usually produce higher quality FFB due to better control.

Owners of small estates know dealers can provide a service, and would sell part of their crops to them as diversification helps to maintain their sales channels. In times of high crop yields, the dealers can find buyers when some mills cannot accept any more fruits.

On the whole, perhaps some independent millers have a lot to answer for. This includes the state of the equipment used, management expertise, practices such as blending inferior quality oil with fresh CPO as well as the payment system to dealers and owners.

Are millers paying as promptly as dealers, who also, in many cases, provide loans and advances to independent smallholder so that they can get their supply of fertiliser?

Unripe FFB bunches in the country is said to be losing an extraction rate of about 2% against the 20% achieved now, meaning that one-tenth more oil could have been produced from the FFB needed to produce 17 million tonnes of CPO.

The loss of 1.7 million tonnes of CPO, due to premature harvesting, can be as high as RM4bil a year in sales.

Deputy news editor Hanim Adnan believes the relationship between FFB dealers and palm oil millers is generally harmonious, but that one or two bad hats in the industry could spoil it.

Crop Dealer

Why Indonesia needs ISPO

2010-12-20T23:39:00.000-08:00

Sustainable palm oil and RSPO

Sustainable palm oil has been the topic of discussion among the members of the palm oil sector since 2003, the year when the players in the sector held the first meeting to set up is the Roundtable on Sustainable Palm Oil which was eventually formed a year later and registered in Zurich, Switzerland on April 8, 2004 as an association. It was created by private stakeholders or the so-called B to B (business to business) establishment as no governments were involved.

The principal objective of RSPO is “to promote the growth and use of sustainable palm oil through co-operation within the supply chain and open dialog between its stakeholders.” The not-for-profit association will have members representing major players along the palm oil supply chain, namely the oil palm growers, palm oil processors and traders, consumer goods manufacturers, retailers, banks and investors, environmental/nature conservation NGOs and social/development NGOs. The RSPO is a unique platform for pragmatic co-operation to contribute to the expansion of sustainably produced palm oil and its uses.

The application of RSPO standards is voluntary for its members, although its members are recently required to implement these standards and given a time limit to apply the standards. As of Nov. 25, 2010, RSPO members from Indonesia totaled 74, consisting palm oil growers, processors, traders and NGOs. The total members of the association as of Nov. 25, 2010 reached 500; they include:

* Banks and Investor (8)
* Consumer Goods
* Manufactures (99)
* Environmental or Nature Conservation Organization (NGOs) (12)
* Oil Palm Growers (84)
* Palm Oil Processors and Traders (160)
* Retailers (22)
* Social or Development Organization (NGOs) (9)

The organization actively tries to increase public awareness of the need for sustainable palm oil and the need to preserve the environment along in conjunction with palm plantation activities. But until now, there is a lack of consumer awareness about sustainable products, especially if the prices of these products are higher than the non-sustainable products.

The challenges for Indonesia’s palm oil

In recent years, Indonesia’s palm oil sector has faced various problems, including never-ending allegations by NGOs, the strict demands from the RSPO and conditions imposed by the EU. The EU has issued the EU Directive on Promotion of the use of energy from renewable resources, amending and subsequently repealing Directive 2001/77/EC and 2003/30/EC (EU RED).

The RSPO has importantly ruled that any new plantation opening after 2007 is not allowed in primary forest and peat land and must protect the High Conservation Value, while the EU Renewable Energy Directive (EU RED) has set criteria on the use of palm oil as feedstock for biofuel production.

The EU RED rules a new plantation for biofuel raw material (not applicable only for biodiesel from palm oil but for all types of biofuels) which is opened after the year 2008 should not come from lands containing high biodiversity and land containing a high carbon stock. The regulation is pretty tough as it uses the forest definition in accordance with the provisions of the IPCC. In addition, the EU has set a target to achieve GHG emission saving of 35 percent by 2017. By 2020, the GHG saving emission should reach 60 percent. Palm oil biodiesel cannot meet this requirement because the default emission saving value is only 19 percent.

According to an EU study, only two commodities are not included in the category of 35-percent saving emission: palm oil and soybean biodiesels.

The EU RED will cover many new criteria and requirements related with biodiversity, such as the high biodiversity grassland, the Land Use Change (LUC) and Indirect Land Use Change (ILUC), for which the standard will be added later. This is a tough challenge for the producers of biodiesel and raw materials producers for biodiesel, especially those made from oil palm.

Check the rest of the article here...

Sustainable palm oil clusters

2010-12-15T21:23:00.000-08:00

15/12/2010 (The Star Online) - VARIOUS activities has been implemented by the Plantation Industries and Commodities Ministry aiming to develop sustainable palm oil clusters (SPOC) in the country in collaboration with the Malaysian Palm Oil Board (MPOB).

Implementation of SPOC is envisaged to increase smallholder productivity from the current 12 to 15 tonnes of fresh fruit bunch (FFB) per hectare per year to 18 to 20 tonnes per hectare in the short term.

More than 7,000 smallholders who merged to form 10 clusters nationwide had been identified as pioneers for the setting up of the SPOC.

The Malaysian Palm Oil Board (MPOB), which will be implementing the SPOC seeks to achieve these objectives.

Firstly, the MPOB seeks to increase the productivity of independent smallholders through among others, implementation of Good Agriculture Practices (GAP) and the production of higher quality FFB.

The second objective is to facilitate certification of smallholder crops under the Roundtable on Sustainable Palm Oil (RSPO). The RSPO is a global multi-stakeholder association made up of players along the palm oil value chain.

The objective of RSPO is to promote the growth and use sustainable oil palm products through credible global standards.

Plantation Industries and Commodities Minister Tan Sri Bernard Dompok said the government had allocated RM50mil for this certification and the involvement of smallholders would complete the entire chain of the country’s palm industry in producing products recognised by RSPO.

“The smallholder sector presently accounts for about 40% of the total oil palm areas and over 28% of national palm oil production,” he said when opening the National Conference of Smallholders in August.

He said smallholders also played a role in realising Vision 35:25 which envisages an FFB yield of 35 tonnes per hectare per annum and an oil extraction rate of 25% by 2020.

Complementing the sustainability requirements, SPOCs will be encouraged to establish cooperatives to empower smallholders to raise income levels.

Thirdly, the MPOB aims to increase smallholder income by establishing cooperatives in SPOC to undertake other income generating activities.

This is to be achieved through among others, replanting of unproductive palm oil trees and the implementation of GAP, which involves fertilizer application, pesticide control and harvesting of FFB.

The cooperatives are envisaged to participate in activities relating to creating supplementary income to smallholders which include raising cattle and goats, integrating palm oil planted area with other short-term crops such as bananas and, marketing of these products on behalf of the smallholders.

The cooperatives are also expected to collectively purchase on behalf of smallholders agriculture inputs such as fertilizers and pesticides.

The significance outcome arising from the establishment of SPOC is the increase in smallholders’ income by way of enhanced productivity.

This is envisaged to accrue remunerative pricing as well as contribute towards the overall improvement if the social economic levels of the smallholders. In addition, the establishment of cooperatives in SPOC will empower the smallholders in decision making and undertake business activities to complement their income levels.

Malaysia’s palm oil industry is the fourth largest contributor to the economy and currently accounts for RM1,889 (or 8%) of the gross national income (GNI) per capita. The industry spans the entire value chain from plantations to downstream activities.

Malaysia Industry

Increased Planting May Boost Indonesian Palm Oil Production by 8.5% in 2011

2010-12-15T00:35:00.000-08:00

05/12/2010 (Jakarta Globe) - Indonesia’s palm oil output may grow by 1.8 million metric tons to 22.8 million tons in 2011 because of increased planting, Indonesian Palm Oil Board vice chairman Derom Bangun said in on Friday.

“World demand will be more than 2 million tons, maybe 3 million tons,” Bangun said in Bali. “From that point of view, I consider that supply through 2011 will be very tight.”

Palm oil output has been lower than usual this year because of heavy rainfalls caused by the La Nina weather event disrupting harvesting.

Global demand for edible oils will exceed supply for a third straight year, increasing by 4.5 million tons, as supply expands 3.5 million tons, said Dorab Mistry, director of Godrej International, on Sunday.

He predicted prices will reach 3,600 ringgit ($1,140) a ton this month.

Bangun said prices will remain at about that price until January, after which demand will be relaxed, sending prices about 10 percent lower by the end of the first quarter.

Prices will increase “significantly,” by as much as 10 percent by September, after the end of peak production season, assuming there is no fluctuation in fuel prices, he said.

Indonesia’s palm oil output this year is expected to be 21 million tons, a slight increase from 20.3 million tons in 2009, because of bad weather and because aging trees are overdue for replanting, Bangun said.

The industry has grown rapidly over the past few years but is facing rising criticism from environmental groups over deforestation and the annual slash and burn tactics which leaves large parts of Malaysia and Singapore blanketed in haze.

Palm oil, however, is a major export revenue earner for the country and palm oil companies have registered healthy profits.

World Edible Oil Market

Palm Oil Prices to Rise 11% as China Buys to Rebuild Inventory, Patel Says

2010-12-13T20:03:00.000-08:00

09/12/2010 (Bloomberg) - Palm oil prices may climb 11 percent to the highest level in almost three years on increased imports by China and as dry weather hurts soybean planting in Argentina, according to Govindlal G. Patel, director of GGN International.

Futures may advance to as much as 4,000 ringgit ($1,272) a metric ton by March, Patel said in an interview from Rajkot in western India. A seasonal decline in output in Malaysia, the second-biggest producer, will contribute to the gains, he said.

Palm oil has rallied 36 percent this year, headed for its second straight annual advance, on optimism that rising demand in China may strain global supplies curbed by rain and drought in producing nations. Global demand for eight vegetable oils will exceed output for the first time in eight years in 2010- 2011 and China’s import reliance is at “an alarming level,” Oil World said in a Nov. 19 report.

“China, I believe, is already buying large quantities to rebuild stockpiles and prices will stay firm,” said Patel, who has been trading vegetable oils for more than three decades. “The already-low inventories will be drawn down further.”

February-delivery futures rose as much as 1.3 percent to 3,640 ringgit, a 29-month high, and traded at 3,617 ringgit at 12:13 p.m. on the Malaysia Derivatives Exchange.

China, the biggest user of commodities, has pledged to control prices by cracking down on the use of bank credit to speculate in agricultural markets and by selling soybeans and vegetable oil from state reserves.

The biggest buyer of soybeans is expected to import 57 million tons in the year from Oct. 1, up 13 percent from a year ago, the U.S. Department of Agriculture data show. Imports may exceed 14.2 million tons from October through December, up 4 million tons from a year earlier, Oil World said this week.

La Nina

Heavy rains caused by a La Nina weather event have reduced oil-palm yields in Indonesia and Malaysia, the top producers. La Nina has also caused drought that curbed South American planting of soybeans, threatening global edible oil supplies and driving prices higher. Malaysia’s production dropped 1 percent to 14.3 million tons in the first 10 months of the year, according to data from the nation’s palm oil board.

“The yield and quality of palm oil output in Malaysia will be affected because of excess rain,” said Patel. “The increase in output next year won’t be sufficient to meet demand.”

Soybean output in Argentina, the third-biggest shipper, may decline to 52 million tons in the year starting April 1 from an estimated 54.5 million tons this year, the Foreign Agricultural Service said in a report on Dec. 6. Exports may fall to 11.5 million tons from 14.7 million tons, according to the report

“While concerns about weather in Brazil have eased, the Argentine soybean crop is still under threat from dry weather,” Patel said.

Palm Oil Exports

Malaysia Has Little Room for Expanding Palm-Oil Production, Minister Says

2010-12-09T18:08:00.000-08:00

18/11/2010 (Bloomberg) - Malaysia’s limited room for expanding palm oil cultivation means that industry growth will have to come from improving productivity, its plantation minister said.

About 4.6 million hectares (11.4 million acres) of the southeast Asian nation’s 32 million hectares are planted with oil palms, Plantation Industries and Commodities Minister Bernard Dompok said last night in London. About 58 percent of the country is forested and the government has a commitment to maintain at least half of all land as natural forest.

“I do not see any further large-scale planting of oil palm in Malaysia,” Dompok said during a round-table discussion at the policy analyst Chatham House. “There may be pockets which can be done by people in rural areas that could be turned into palm oil but these are not very much.”

Dompok was trying to allay concerns from environmental groups such as Greenpeace that expansion of palm oil plantations in Malaysia and especially in Indonesia is leading to the further destruction of forests and increasing emissions of greenhouse gases blamed for global warming.

Malaysia, the second-biggest producer of palm oil, this year will produce about 17.6 million tons of crude palm oil and export 15.8 million tons of the substance, which is used in foods and biofuels, Dompok said. Annual productivity per hectare is about 4 tons and this could be increased to 17 tons, he said.

“We can increase the yield per hectare by planting new varieties and new clones,” Kalyana Sundram, deputy chief executive officer of the Malaysian Palm Oil Council, said in an interview in London. “Because of the lack of new land to cultivate oil palms, if you want to be a major player in the industry, that’s the way to go -- increase the yields.”

Power from Waste

Dompok and Indonesian Vice Minister of Agriculture Bayu Krisnamurthi on Nov. 15-16 met with European Union officials to rally support for palm oil. A new European directive governing the use of renewable energy “discriminates” against palm oil compared to other oil crops, they said in a joint statement.

The directive promotes the use of oils in biofuels that cut greenhouse-gas emissions by 35 percent, and palm oil is classified as leading to a cut of just 19 percent. Malaysian Palm Oil Board Director-General Choo Yuen May told the round table meeting that the correct figure is 36 percent because about a third less nitrogen-based fertilizer is used in the Malaysian industry than the EU factored into its assumptions.

Dompok said he’s also trying to promote the burning of waste products from palm oil production to generate electricity. Domestic power prices would have to rise to 35 cents a kilowatt- hour from 21 cents for such a plan to be economical, he said.

“I would like all these palm oil effluents to be used for electrification,” Dompok said. “I am trying to present to the Cabinet that we need incentives to clean up the oil palm industry. We need tariffs.”

Malaysian Palm Oil

British firms mostly support Malaysian palm oil

2010-11-24T17:15:00.000-08:00

By HANIM ADNAN
nem@thestar.com.my

But the country urged to step up promotional efforts

LONDON: Top British retailers and food manufacturers are mostly supportive of local palm oil but they want Malaysia to step up its promotional efforts and communication strategies to heighten the awareness among British end-consumers of the sustainable credentials of the commodity.

This was unveiled during a dialogue session between Britain's palm oil retailers/end-users and the Malaysian palm oil delegation headed by Plantation Industries and Commodities Minister Tan Sri Bernard Dompok at the Malaysian High Commission in London on Friday.

While the interest in palm oil usage is good in Britain, the Malaysian delegation comprising the chiefs of the Malaysian Palm Oil Council (MPOC), Malaysian Palm Oil Board (MPOB) and Malaysian Palm Oil Association (MPOA) was told there were still many misconceptions about palm oil among British consumers.

Many consumers are heavily influenced by the anti-palm oil campaigns of NGOs, which had extensively been playing up environmental issues such as the killing of orang utans, biodiversity and rainforest destruction, and impact on global climate change, said J. Sainsbury Plc branding director Judith Batchelar.

Sainsbury is one of Britain's top three grocery retailers.

Batchelar said: We seem to be getting more emails (from our customers) questioning the qualities of palm oil and its sustainability issues compared with other vegetable oils sold in the market.

Tesco Plc corporate responsibility director Ruth Girardet concurred, saying the retail chain was also constantly pressured by the Western media and NGOs (or non-governmental organisations) on looming issues concerning palm oil.

As a retailer, we share the equal responsibility to explain to our customers about palm oil. We need to know that our suppliers adhere to the Roundtable on Sustainable Palm Oil (RSPO) certification.

In fact, Tesco is committed to using only certified sustainable palm oil by 2015, Girardet said.

Nestle UK Ltd corporate communications director Ian Rayson, meanwhile, said Malaysia must adopt a pro-active communication approach when countering the various allegations and misinformation about palm oil.

Malaysia should be telling a tomorrow's story. It is in danger of putting a defensive stance by continously comparing palm oil with our local crops like rapeseed and sunflower oils.

While palm oil may be the most efficient oil in terms of production, we (Europe) however cannot plant palm oil simply because of the unsuitable climate.

Rayson said Malaysia should focus on a more positive theme, like how palm oil could feed the world. It is also important for Malaysia to state its commitment where 58% of its land area is forest cover.

Europe's biggest biscuit maker United Biscuits (UK) Ltd, meanwhile, has targeted that by the end of 2011, all its palm oil is certified as sustainable and delivered through supply chains that are fully segregated from non-certified palm oil.

Its fats and oils director Dr Simon Roulston said: We will use only RSPO segregated, sustainable palm oil so that we can be sure the palm oil in our products is the oil from the sustainable plantations.

Currently, we have reached 70% usage of RSPO segregated palm oil.

And while Matheson & Co senior director Simon Keswick questioned the credibility of the RSPO certification, MPOC chairman Datuk Lee Yeow Chor said Malaysia supported the RSPO as it was the world's first certification programme for palm oil where companies had to adhere to its 24 strict principles and criteria.

MPOC is working with a new media company to come up with blogs, contests and short video clips to promote palm oil in Europe as part of efforts to counter the negative publicity over palm oil.

He suggested that British retailers and end-users of palm oil work together with MPOC to spread the good message on palm oil.

While many European consumers insist on RSPO certified palm oil, MPOA chief executive officer Datuk Mamat Salleh noted that the offtake for the premium oil was still not good.

Dompok, in summing up the dialogue session, said palm oil had become a victim of its own success. However, Malaysia will continue to put a clear message across that palm oil is a sustainable crop.

Malaysian Palm Oil

Positive Developments Despite Anti-palm Oil Lobby

2010-11-19T00:56:00.000-08:00

This news analysis is written by national newswire Berita Nasional Malaysia (Bernama) editor-in-chief Dato' Yong Soo Heong.

KUALA LUMPUR, May 5 (Bernama) -- Malaysia's palm oil industry is worth about RM50 billion annually and chances are that revenue may even touch RM60 billion this year, if current prices remain steady until the end of the year.

That crude palm oil is being sold at RM2,550 a tonne is certainly good news for planters, smallholders and all those associated with the industry.

But then there are detractors. It has been reported that the European Union (EU), through its environmental ministries and commissions, has been involved in funding up to 70 per cent of the operating budgets of environmental NGOs in efforts to paint a not-so-rosy picture about palm oil.

And these NGOs have been viciously campaigning against palm oil imports into the EU, especially for biofuels, says Tan Sri Dr Yusof Basiron, chief executive of the Malaysian Palm Oil Council, who regards this as a "senseless and immoral attack on exported commodities such as palm oil produced by developing countries."

Writing in his blog, he said, such funding implicates the EU for creating barriers to trade for agricultural products from developing countries. "Unlike the EU, developing countries do not have access to financial resources to fight such government funded vicious campaigns. The eventual outcome will be untold miseries where poor farmers in developing countries lose their source of income as their export commodities are unable to enter the EU market," he said.

This is something which palm oil-producing countries will have to seriously address if the livelihood of their planters and farmers is to be safeguarded. Almost a million people are directly employed by the palm oil industry in Malaysia.

Interestingly, a campaign by Friends of the Earth to pressure the European Commission (EC) to rule "a tree plantation is not a forest" that restricts the recognition of palm oil as a renewable biofuel in the EU may have failed.

According to a newsletter titled "Palm Oil - Green Development Campaign" produced by Washington-based pro-development NGO World Growth, this means that the EC may classify oil palm plantations as forests, which would therefore meet the sustainability criteria of the EU's Renewable Energy Directive.

Under the directive, land which used to contain primary forest prior to 2008 but no longer does, cannot be used for biofuel feedstock to meet the EU's 10 per cent target. It has been reported that the draft guidelines define a "forested area" as "areas where trees have reached, or can reach, at least heights of five metres, making up a crown cover of more than 30 per cent". They would normally include forest, forest plantations and other tree plantations such as palm oil.

"The EC's position would therefore recognise that the important property of tropical forests for climate change policy is the high sequestering capacity of tropical foliage, tall wooded plants and multi-decade crop rotation. Short rotation coppice [the practice of repeatedly cutting young tree stems down] may qualify if it fulfils the height and canopy cover criteria," the newsletter stated.

It would seem that the EC has recognised the environmental benefits of palm oil as highly energy efficient, high yield and economically beneficial biofuel as the oil palm trees sequester or remove more carbon dioxide than other biofuel crops.

Another development that has put palm oil in positive light is research from Wageningen University in the Netherlands which shows that "palm oil is the most efficient energy crop." The university's finding is a rejection of environmental NGOs and the anti-palm oil lobbyists who consistently claim that palm oil is unsustainable.

Its research found that palm oil, sugar cane and sweet sorghum are currently the most sustainable energy crops. These commodities also produce "far smaller quantities of greenhouse gases than fossil fuels". The university's analysis considered nine different energy crops against nine different sustainability criteria with palm oil coming out on top while biofuel from maize from the United States and wheat from Europe scored far lower.

The report's author, Sander de Vries, concluded that sustainable sugar canes and oil palms get the most energy per hectare and cause the least environmental damage. De Vries also highlighted a major advantage of the oil palm crop was that, unlike other energy crops, it produces enough residue to power the oil extraction processes.

Another positive development for palm oil took place in the European Parliament recently when Dr Gernot Pehnelt, founder and director of GlobEcon, an independent research and consulting institute based in Germany, released a new study that revealed the prejudiced nature of the EU's Renewable Energy Directive towards foreign biofuels.

The report, entitled "European Policies Towards Palm Oil: Sorting Out Some Facts," demonstrated that the assumptions contained in the directive about the ecological impact of foreign biofuels reflected political and not scientific or economic reality. Pehnelt came to the defence of the rich biodiversity in oil palm plantations, their excellent crown cover that oil palms provide and the yield per hectare advantages of this low-energy and low-fertilizer crop.

"Sadly, many of the claims that foreign biofuels, specifically palm oil, are a threat to the environment are seriously flawed, some even completely unfounded," he said, adding that the side effects of the flawed policies could give rise to political friction and trade disputes to severe economic handicaps for developing countries.

"This new study makes a strong case that the directive discriminates against non-EU producers of biofuels, such as Asian palm oil. Perhaps most importantly, palm oil acts as a substantial driver of economic growth in the developing world, drastically reducing hunger and poverty in regions that actively cultivate this valuable crop.

"It's time for Europe to not only recognise the energy and environment benefits of palm oil, but also the suffering in low-income, tropical countries that palm oil critics continue to perpetuate," said Pehnelt, who has been invited by MPOC to speak on "European policies towards palm oil - setting the record straight" at the International Palm Oil Sustainability Conference in Kota Kinabalu from May 23 to 25.

The MPOC says that the conference will feature the latest developments, breakthroughs and technologies related to the sustainable development of the palm oil industry, with a focus on major issues such as Life Cycle Assessment, carbon footprint, sustainable production, certification and branding, biodiversity conservation and the corporate social responsibility of the palm oil industry.

Over the years, palm oil has emerged to have a huge multiplier effect to the Malaysian economy, supporting some two million livelihoods across many sectors. Additional workforce is also required to run downstream activities as palm oil is a versatile commodity. It is not just palm oil, but also palm kernel oil and palm kernel cake, which have different market and applications. Oil palm biomass and methane can also be used to produce electricity.

Currently, there are 600 million oil palms in Malaysia that could be also harvested and converted into fibre products, including medium density fibre boards as well as pulp and paper. Oil palms are also harvested to make furniture.

"Put all this together, palm oil is a very important and vibrant industry, which makes a lot of money for the country," said MPOC's Yusof. Malaysia has been working very hard to make its palm oil industry environmentally-friendly and socially responsible. Oil palm is only planted on land designated for agricultural production.

Today, Malaysia still maintains 56 per cent of its total land area under forest, thereby keeping its pledge made at the 1992 Rio Summit to keep at least 50 per cent of its land area under forest intact. It is certainly food for thought for the detractors.

Palm Oil Industry

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Performance of Malaysian Palm Oil Industry on October 2010

2010-11-14T17:29:00.000-08:00

	SEPTEMBER(r)	OCTOBER(p)	DIFFERENCE
	SEPTEMBER(r)	OCTOBER(p)	QUANTITY	(%)
PRODUCTION (Tonnes)
CRUDE PALM OIL
P. Malaysia	866,790	895,859	29,069	3.35
Sabah	472,983	507,820	34,837	7.37
Sarawak	223,139	232,881	9,742	4.37
Total	1,562,912	1,636,560	73,648	4.71
PALM KERNEL	395,455	407,378	11,923	3.02
CRUDE PALM KERNEL OIL	167,121	206,933	39,812	23.82
PALM KERNEL CAKE	184,964	229,573	44,609	24.12
STOCK (Tonnes)
CRUDE PALM OIL
P. Malaysia	456,441	472,303	15,862	3.48
Sabah	325,364	351,796	26,432	8.12
Sarawak	147,420	144,166	(3,254)	(2.21)
Total	929,225	968,265	39,040	4.20
PROCESSED PALM OIL
P. Malaysia	382,949	437,299	54,350	14.19
Sabah	303,246	305,394	2,148	0.71
Sarawak	94,493	81,882	(12,611)	(13.35)
Total	780,688	824,575	43,887	5.62
TOTAL PALM OIL
P. Malaysia	839,390	909,602	70,212	8.36
Sabah	628,610	657,190	28,580	4.55
Sarawak	241,913	226,048	(15,865)	(6.56)
Total	1,709,913	1,792,840	82,927	4.85
PALM KERNEL	156,286	118,784	(37,502)	(24.00)
CRUDE PALM KERNEL OIL	137,204	154,209	17,005	12.39
PROCESSED PALM KERNEL OIL	108,956	124,797	15,841	14.54
TOTAL PALM KERNEL OIL	246,160	279,006	32,846	13.34
PALM KERNEL CAKE	226,248	232,290	6,042	2.67
EXPORT
PALM OIL	1,469,005	1,460,241	(8,764)	(0.60)
PALM KERNEL OIL	114,503	88,962	(25,540)	(22.31)
PALM KERNEL CAKE	252,749	257,612	4,863	1.92
OLEOCHEMICAL	171,950	177,450	5,500	3.20
BIODIESEL	10,011	0	(10,011)	(100.00)
IMPORT (TONNES)(q) Import
CRUDE PALM OIL	85,526	62,476	(23,050)	(26.95)
PROCESSED PALM OIL	0	7,819	7,819	0.00
PALM OIL	85,526	70,295	(15,231)	(17.81)
TOTAL PALM KERNEL OIL	36,156	30,878	(5,278)	(14.60)
PRICE (1% OER) (Local Ex-Mill) )
FFB (AVERAGE RM/TONNE)	29.38	31.44	2.06	7.01

Explanatory Notes:

(p)	Preliminary

(q)	The import and export figures are based on information extracted from Customs No. 1 and 2 (Rev. 8/89) received up to 10.00 a.m., 10 November 2010. The export date refers to that as authorised by the Customs Department.

(r)	The figures for the month of September 2010 are revised by taking into account corrections made by the licensees and from late receipt of Customs No. 1 and 2 (Rev. 8/89) after 11 October 2010.

(s)	It refers to the total physical amount of crude and processed palm oil kept at the premises of mills, refineries, bulking installations, and oleochemical plants as at 31 October 2010.

Palm Oil Futures

Online Commodity Trading

2010-10-26T22:43:00.000-07:00

Bursa Malaysia Derivatives Berhad (BMD), operates the most liquid and successful crude palm oil futures (FCPO) contract in the world. On September 17, 2009, Bursa Malaysia Berhad entered into a strategic partnership with Chicago Mercantile Exchange (CME) with the view to improve accessibility to its derivatives offerings globally. This includes licensing of the settlement prices of the FCPO to position Malaysia as the global price benchmark for the commodity as well as global distribution of Bursa Malaysia's products through the Globex electronic trading platform.

BMD has the following palm oil products available to be traded on the CME Globex ^® electronic trading platform:

Commodity Derivatives

Crude Palm Oil Futures (FCPO)
USD Crude Palm Oil Futures (FUPO)
Crude Palm Kernel Oil Futures (FPKO)

Crude Palm Oil Futures (FCPO)

Contract Code	FCPO
Underlying Instrument	Crude Palm Oil
Contract Size	25 metric tons
Minimum Price Fluctuation	RM1 per metric ton
Daily Price Limit	With the exception of trades in the spot month, trades for future delivery of Crude Palm Oil in any month shall not be made, during any one Business Day, at prices varying more than 10% above or below the settlement prices of the preceding Business Day (“the 10% Limit”) except as provided below. When at least 3 non-spot month contracts are trading at the 10% Limit, the Exchange shall announce a 10-minute cooling off period (“the Cooling Off Period”) for all contract months (except the spot month) during which trading shall only take place within the 10% Limit. Following the Cooling Off Period, all contract months shall be specified as interrupted for a period of 5 minutes, after which the prices traded for all contract months (except the spot month) shall not vary more than 15% above or below the settlement prices of the preceding Business Day (“the 15% Limit”). If the 10% Limit is triggered less than 30 minutes before the end of the first trading session, the following shall apply:- the contract months shall not be specified as interrupted; the 10% Limit shall be applied to all contract months (except the spot month) for the rest of the first trading session; and the 15% Limit shall be applied for all contract months (except the spot month) during the second trading session. If the 10% Limit is triggered less than 30 minutes before the end of the second trading session, the 10% Limit shall be applied to all contract months (except the spot month) for the rest of the Business Day.
Contract Month	Spot month and the next 5 succeeding months, and thereafter, alternate months up to 24 months ahead
Trading Hours	First trading session: Malaysian time: 10:30 a.m. to 12:30 p.m. Second trading session: Malaysian time: 3:00 p.m. to 6:00 p.m.
Speculative Position Limits	500 contracts net long or net short for the spot month 5,000 contracts for any single delivery month except for the spot month ,000 contracts for all contract months combined
Final Trading Day and Maturity Date	Contract expires at noon on the 15th day of the delivery month, or if the 15th is a non-market day, the preceding Business Day.
Tender Period	1st Business Day to the 20th Business Day of the delivery month, or if the 20th is a non-market day, the preceding Business Day.
Contract Grade and Delivery Points	Crude Palm Oil of good merchantable quality, in bulk, unbleached, in Port Tank Installations approved by the Exchange located at the option of the seller at Port Kelang, Penang/Butterworth and Pasir Gudang (Johor). Free Fatty Acids (FFA) of palm oil delivered into Port Tank Installations shall not exceed 4% and from Port Tank Installations shall not exceed 5%. Moisture and impurities shall not exceed 0.25%. Deterioration of Bleachability Index (DOBI) value of palm oil delivered into Port Tank Installations shall be at a minimum of 2.5 and of palm oil delivered from Port Tank Installations shall be at a minimum of 2.31.
Deliverable Unit	25 metric tons, plus or minus not more than 2%. ettlement of weight differences shall be based on the simple average of the daily Settlement Prices of the delivery month from: the 1st Business Day of the delivery month to the day of tender, if the tender is made before the last trading day of the delivery month; or the 1st Business Day of the delivery month to the Business Day immediately preceding the last day of trading, if the tender is made on the last trading day or thereafter.

Crude Palm Kernel Oil Futures (FPKO)

Contract Code

FPKO

Underlying Instrument

Crude Palm Kernel Oil

Contract Size

25 metric tons

Minimum Price Fluctuation

RM1 per metric ton

Daily Price Limits

RM100 per metric ton above or below the preceding day's Settlement Prices for all months, except spot month. Limits are expanded when the Settlement Prices of all three quoted months immediately following the current month, in any day, are at limits as follows:

Day	Limit
First Day	RM100
Second Day	RM150
Third Day	RM200

Daily price limits will remain at RM200, when the preceding day's settlement prices of all the three quoted months immediately following the spot month settle at limits of RM200.
Otherwise, it shall revert to the basic limit amount of RM100.

Contract Months

Spot and the next five succeeding months, and thereafter, alternate months up to 12 months ahead.

Trading Hours

First trading session: Malaysian 10:30 a.m. to 12:30 p.m.
Second trading session: Malaysian 3:00 p.m. to 6:05 p.m.

Final Trading Day and Maturity Date

Contract expires at 12:05 on the 15th day of the delivery month. If the 15th is a non-market day, the preceding Business Day.

Tender Period

First Business Day to the 20th Business Day of the delivery month, or if the 20th is a non-market day, the preceding Business Day.

Contract Grade and Delivery Points

Each tender shall consists of 25 metric tons of Crude Palm Kernel Oil in bulk unbleached of good merchantable quality and stored at a Port Tank Installations located at the option of the seller at Port Kelang, Penang/Butterworth and Pasir Gudang (Johor).

Free Fatty Acids (FFA) content (as Lauric Acid of CPKO) delivered into Port Tank Installations shall not exceed 3.5% and out of Port Tank Installations shall not exceed 4%.
Moisture and impurities shall not exceed 0.5%.
Iodine value at range 16.5 < 18.75
Colour range 4 Red - 8 Red & 60 Yellow Max.

Delivery Unit

25 metric tons, plus or minus not more than 2%.
Settlement of weight differences shall be based on the simple average of the daily Settlement Prices of the delivery month from:

(a) the 1st Business Day of the delivery month to the day of tender, if the tender is made before the last trading day of the delivery month; or
(b) the 1st Business Day of the delivery month to the Business Day immediately preceding the last day of trading, if the tender is made on the last trading day or thereafter.

Position Limit

250 contracts net long or net short on the spot month.
1,000 contracts on any single month except for the spot month.
1,500 contracts on all contract months combined.

USD Crude Palm Oil Futures (FUPO)

FUPO is a USD denominated palm oil futures contract which compliments the existing MYR denominated Crude Palm Oil Futures contract (FCPO). It is a cash settled contract which does not involve physical delivery of the underlying Crude Palm Oil (CPO). FUPO also consolidate Malaysia’s position as the leading price discovery centre for palm oil traded globally.

Contract Code	FUPO
Underlying Instrument	Crude Palm Oil
Contract Size	25 metric tons
Minimum Price Fluctuation	USD0.25 per metric ton
Settlement Methodlogy	Cash Settled
Daily Price Limits	A +/- 10% limit from the Settlement Prices of the preceding trading day will apply for all contract months, except for the spot month. When at least 3 non-spot month contracts are trading at the 10% limit, a 10 minute Cooling Off period will apply for all quoted months (except spot month as there are no price limits for spot month contract) during which trading shall only take place within the 10% Limit. Following the Cooling Off period, all quoted months shall be interrupted for 5 minutes, after which the price limit will be expanded to +/-15%. The 10% price limit will apply for the rest of the 1st trading session if the price limit is triggered less than 30 minutes before the end of session, and the price limit will be expanded to 15% for the 2nd trading session. If the 10% limit is triggered less than 30 minutes before the end of the 2nd trading session, the 10% limit will apply for the rest of the trading day.
Contract Months	Spot month and the next 5 succeeding months, and thereafter, alternate months up to 24 months ahead
Trading Hours	First trading session : Malaysian Time: 10:30 a.m. to 12:30 p.m. Second trading session : Malaysian Time: 3:00 p.m. to 6:00 p.m.
Speculative Position Limits	500 contracts net long or net short for the spot month 5,000 contracts for any single contract month except for the spot month 8,000 contracts for all contract months combined
Final Trading Day and Maturity Date	Contract expires at noon on the 15th day of the spot month, or if the 15th is a nonmarket day, the preceding Business Day.
Final Settlement	Cash settlement based on the Final Settlement Value.
Final Settlement Price	The average price of the Daily Spot Month Settlement Price of the FCPO on the last 5 Business Days prior to the expiration including the Final Trading Day. The mid exchange rate of USD/MYR as at 6.00pm on each of the 4 Business Days prior to the Final Trading Day taken from Bank Negara Malaysia shall be used as the conversion price for the calculation of FCPO Daily Spot Month Settlement Value (Mid price USD/MYR multiplied by the Daily Spot Month Settlement Price of FCPO). The mid Exchange rate of USD/MYR as at noon will be used for calculation of Daily Spot Month Settlement Price for the Final Trading Day. The FUPO Final Settlement Value shall be the average of the converted FCPO Daily Spot Month Settlement Prices rounded to the nearest 25 cents.

Eight EPPs to capture fast growing global demand for palm oil

2010-10-25T20:51:00.000-07:00

Reports by IZWAN IDRIS, LOH FOON FONG, LESTER KONG, RACHAEL KAM, WONG PEK MEI, SHAUN HO and REENA NATHAN in The Star

MALAYSIA’S palm oil industry is the fourth largest contributor to the economy and currently accounts for RM1,889 (or 8%) of the gross national income (GNI) per capita. The industry spans the entire value chain from plantations to downstream activities.

Its development is mainly private-sector driven and is still heavily skewed towards upstream activities, namely production of fresh fruit bunches (FFB) in plantations, processing of FFBs in mills and palm kernel crushing and palm oil refining activities.

While Government support is primarily targeted at promoting downstream activities and supporting independent smallholders, the core focus of the Palm Oil National Key Economic Area (NKEA) is to reinforce the leading role of the private sector in steering the palm oil industry.

The aim is to raise the industry’s GNI contribution from the current RM52.7bil to RM178bil by 2020.

It plans to bridge this GNI gap through the implementation of eight core entry point (EPP) spanning across the palm oil value chain to capture the fast growing global demand for palm oil, which registered a growth rate of 10% between 2000 and 2009.

Five EPPs will focus on improving upstream productivity generating as incremental GNI of RM33.1bil in 2020. The implementation of these EPPs will transform Malaysia’s oil palm industry, resulting in significant productivity improvement from 21 to 26.2 tonnes per hectare per year.

These EPPs are accelerating the replanting of oil palm, improving FBB yield, improving worker productivity, increasing the oil extraction rate and developing biogas at the palm oil mills.

The other three EPPs are focused on downstream expansion that is targeted to generate an incremental GNI of RM14bil by 2020.

These initiatives will involve coordinating public-private R&D efforts with a strong commercialisation focus. Rising income from downstream products is expected to constitute at least 25% of total palm oil income.

These EPPs are developing oleo derivatives, commercialising second generation biofuels and expediting growth in food and health-based downstream segments.

Edible Oil: To Compare Olive Oil with Palm Oil

2010-10-19T00:12:00.000-07:00

Olive Oil And Palm Olein Are Equally Beneficial Against Coronary Heart Disease Risk

Extra Virgin Olive Oil

Olive oil is touted as the gold standard among all edible oils today; a reputation that has been gained primarily from its association of a lower incidence of heart disease among the Mediterranean populations who have traditionally consumed olive oil as their main dietary fat. The component of interest is the monounsaturated oleic acid content of olive oil, which on average is about 70% of its composition.

Palm Olein, the liquid fraction of Palm Oil, averages 47-53% of its composition as the same oleic acid that is found in olive oil and the other monounsaturated oils.

Did you know that despite the lower content of monounsaturated oleic acid in palm olein, the ability of olive oil and palm olein to regulate plasma cholesterol levels in humans is essentially identical.

Humans fed diets predominating as either olive oil or palm olein showed identical plasma cholesterol response which augers well for the beneficial effects of these oils against Coronary Heart Disease risk.

Study No.1

Olive Oil and Palm Olein Have Similar Effects on Plasma Cholesterol in Humans

Ng, K.W.T, Hayes, K.C., Dewitt, G. F., Jegathesan, M., Satgunasingam, N., Ong, A. & Tan, D. (1992). Dietary palmitic and oleic acids exert similar effects on serum cholesterol and lipoprotein profiles in normocholesterolemic men and women. J Am Coll Nutr. 11: 383-90.

Reference/Study Characteristics	Dietary Oil Source	Fatty Acids (% en)			Lipids (mg/dL)
Reference/Study Characteristics	Dietary Oil Source	16:0	18:1	18:2	TC	LDL-C	HDL-C	L/H ratio
Ng et al. (1992) J. Am. Coll. Nutr. 11, 383-390; 20M, 13F; 31% en.	Palm Olein Olive Oil	13.4 6.3	14.0 21.8	3.7 2.9	195 197	133 134	37 37	3.59 3.62

Study No. 2
Olive Oil and Palm Olein Have Similar Effects on Plasma Cholesterol in Humans

Choudhury, N., Tan, L. & Truswell, A.S. (1995). Comparison of palmolein and olive oil: effects on plasma lipids and vitamin E in young adults. Am J. Clin Nutr. 61:1043-51.

Reference/Study Characteristics	Dietary Oil Source	Fatty Acids (% en)			Lipids (mg/dL)
Reference/Study Characteristics	Dietary Oil Source	16:0	18:1	18:2	TC	LDL-C	HDL-C	L/H ratio
Choudhury et al. (1995) Am. J. Clin. Nutr. 61, 1043-1051; 10M, 9F; 31% en.	Palm Olein Olive Oil	10.1 5.1	11.6 18.9	4.3 3.4	180 179	129 132	35 31	3.7 4.3

Conclusion
Palm Olein, in showing nutritionally similar result as olive oil is better as it is much more economical.

Source

Sustainable palm oil production doubles

2010-10-17T20:20:00.000-07:00

08/10/2010 (WWF) - Global production of sustainable palm oil has doubled so far this year, meaning that buyers have access to more palm oil than ever before that was produced without damaging biodiversity, according to new figures from the Roundtable on Sustainable Palm Oil (RSPO).

“Annual production capacity of RSPO-certified sustainable palm oil jumped over the 3 million tonnes mark last month, showing the steepest increase thus far since certification began in August 2008,” according to the Roundtable.

With current global palm oil production projected at around 46.6 million tones annually, about 6.4 percent of this production is now certified as sustainable by the RSPO – up from 3.2 percent a year ago.

“This really shows that some palm oil producers are working hard to make certified sustainable palm oil a world standard,” said Cherie Tan. “However, these producers account for less than 20 percent of the producers represented in the RSPO.

“All RSPO producers must commit to progress, and to adopt time bound plans towards certification.”

WWF released the Palm Oil Buyers’ Scorecard in October 2009 showing that the majority of European palm oil buyers were failing to buy certified sustainable palm oil, despite its availability and the previous commitments by many companies to purchase it. WWF will release its next edition of the Scorecard in the last quarter of 2011.

So far this year, about 60 percent of the sustainable palm oil produced has been bought, the RSPO said. In 2010's first quarter, the overall market uptake of sustainable palm oil was 95 percent, according to the RSPO.

This represents a positive commitment by a handful of European buyers, where buyers are more responsive to environmental and social issues, WWF said.

But similar actions need to be taken by more palm oil buyers in Europe, as well as in other markets, particularly China and India, which are the two largest consuming markets of palm oil. Those two markets represent 31 percent of total consumption in 2010.

China and India have the potential to exert massive footprints on the areas where palm oil is grown and produced, Tan said.

“Transforming the global palm oil market cannot be realized unless the most influential companies in China and India move toward sustainability,” Tan said.

The growing demand for palm oil is adding to the already severe pressure on the world’s remaining rainforests. The loss of forest in Indonesia is threatening the survival of species such as the orang-utan, the Sumatran tiger, rhino and elephant.

Forest loss and the draining of peatlands for palm oil plantations is also contributing to climate change and displacing local people who rely on the forest for food and shelter.

Palm oil is one of the world's fastest expanding crops, with significant growth in Southeast Asia as well as West Africa, Papua New Guinea and South America.

It is because of threats like this that WWF worked with other NGOs and the palm oil industry to set up the Roundtable on Sustainable Palm Oil (RSPO) in 2003. Certified Sustainable Palm Oil has been available since November 2008 and provides assurance that valuable tropical forests have not been cleared and that environmental and social safeguards have been met during the production of the palm oil.

This week’s figures come ahead of the Roundtable’s 8th Annual meeting, which will be held Nov. 8-11 in Jakarta, Indonesia.

Sustainable palm oil producers.(Informalia): An article from: Food Trade Review

Palm oil expected to hit RM3,600 in H1 next year

2010-10-07T07:18:00.000-07:00

06/10/2010 (Business Times) - Palm oil prices can hit RM3,600 a tonne as soon as in the first half of next year, traders say, which would be their highest since 2008 as demand continues to be robust, while supply is hit by erratic weather.

"In the next six to nine months, palm oil prices should trade at around RM3,600 per tonne, if all fundamental factors remain the same," said NextView Sdn Bhd chief market strategist Benny Lee.

He attributed the increase in palm oil prices since July to a weaker US dollar and a stronger yuan.

The last time palm oil prices hit their all-time high, at RM4,486 per tonne, was in mid-2008.

Lee was presenting his take on palm oil price movement at the International Palm Oil Trade Fair and Seminar 2010 in Kuala Lumpur yesterday.

While he foresees several pullbacks and corrections in the pricing in the immediate weeks, Lee was of the view that it will move towards RM2,800 and possibly surpass RM2,950 by the end of the year.

Yesterday, palm oil futures on the Malaysian Derivatives Exchange gained RM29 to close at RM2,705 per tonne. The day before, it fell to a two-week low due to sell-off in the grains markets after a report of huge US corn stockpiles.

India-based Transgraph Consulting Pvt Ltd chief executive officer P.V. Murali Krishna, also present at the event, was bullish on palm oil in the next six months.

"The current price strength is supported by a relative shortage in oil crop output as a result of erratic weather patterns. There's excess rain in the Indian continent but acute dryness in South America. North America has had experienced frost and Europe is not getting enough rain," he said.

Rapid urbanisation in China and India has resulted in lower agriculture activities, forcing these emerging economies to rely on vegetable oil imports.

Malaysia and Indonesia, the world biggest palm oil supplier, stand to gain from the increasing appetite for food from the world's two most populous nations.

"The focus is on Asia. China and India's robust economy and growing population is set to consume palm oil," Murali said.

Firm vegetable oil prices, including palm oil, seen in H1 2011

2010-10-05T02:09:00.000-07:00

KUALA LUMPUR: Global vegetable oil prices, including that of crude palm oil (CPO), are expected to remain firm in the first two quarters of 2011 should soybean production from South America stays flat due to stagnating planted areas, said Malaysian Palm Oil Council (MPOC) chief executive officer Tan Sri Dr Yusof Basiron.

Soybean production in South America next year would be the main factor in determining the price direction of vegetable oils in the first half of next year.

“At this point of time, the projected lower soybean production may further deteriorate as dry spell remain a teething factor for the output,” Yusof said.

He said this in his summary after presenting a paperwork on Glimpse of 2011 – Pointers for 2011 on Global Oils and Fats Trade at the 3rd International Palm Oil Trade and Seminar yesterday.

In addition, an increase in soyoil application for biodiesel production in South America was expected to reduce the availability of soyoil traded globally.

However, CPO production from major producers Malaysia and Indonesia next year may rise substantially due to the delay in potential yield this year as a result of El Nino and La Nina effects, he added.

Palm oil was also expected to continue to be the growth leader in output, with Malaysia and Indonesia as the main supplier for 2011.

For 2010, Yusof said the average CPO price was projected to stay above RM2,600 per tonne, given the firm crude mineral oil price, which had supported the palm oil price so far, “is expected to last for the rest of this year.”

While demand is projected to increase by 4.3 million tonnes this year, the performance of oils and fats production in the last quarter would determine whether there will be any changes in production volume projected in 2010.

He said: “The United States, the European Union (EU) and China are on the radar as their major oil crops are due for harvesting and entering the market at this period.

“The estimated production remains intact and this has been factored into the current CPO price trading at above RM2,700 per tonne.”

Yusof said price would also be supported by the greater role of palm oil in satisfying global demand this year. In addition, the La Nina effect on palm oil production in the second half of this year could likely increase palm fruit moisture content and lower extraction rates, thus reducing harvesting rounds.

Based on OilWorld estimate, La Nina phenomenon would likely reduce Malaysia’s palm oil production by 200,000 tonnes.

US-based Green Earth Fuels LLC executive vice-president (government and regulatory affairs) Jeffrey M. Trucksess said palm biodiesel (palm methyl ester – PME) had made significant inroads in the US biodiesel market in recent years and had tremendous potential.

“However, significant political, regulatory and public relation issues can derail this future,” he said.

PME producers from Malaysia must proactively manage the public perception on palm oil in the United States and Europe by providing more education to policymakers there, actively participate in regulatory bodies and promote sustainability standards.

Economic Transformation Programme: Palm oil to boost GNI by RM125b

2010-09-30T00:02:00.000-07:00

KUALA LUMPUR: The palm oil industry, the fourth largest contributor to the national economy, is expected to generate an additional RM125 billion to gross national income (GNI) in the next decade to reach RM178 billion by 2020.

The industry currently accounts for RM53 billion in GNI. The government, via its entry point projects (EPP), intends to expand both the upstream and downstream segments to achieve this target as well as create an additional 41,000 jobs in the industry.

A cumulative funding of RM124 billion over the next 10 years, with 98% of the funding coming from the private sector, is required to carry out the initiatives in the industry. The total public funding for capital expenditure is expected to be RM2.9 billion with an additional RM2.7 billion in the form of tax incentives, soft loans and cash incentives to promote private sector development in the downstream sector.

Some of the EPPs will focus on improving upstream productivity and transforming Malaysia’s oil palm plantations by accelerating the replanting of aging oil palms.

It is learnt that some 365,000ha of palm oil land is currently above 25 years of age. An addition of 125,000ha will join the band every year if replanting is not carried out.

Additionally, mechanising plantations, stringent enforcement of best practices to enhance fresh fruit bunch (FFB) yield, implementing strict quality control parameters to enhance oil extraction rate and developing biogas facilities at palm mills to capture the methane gas released during the milling process are also part of the initiatives to be carried out.

The industry is aiming to achieve FFB yield of 26 tonnes per year and oil extraction rate of 23% by year 2020 from the current 21 tonnes and 20.5%.

The government also targets to capture the lucrative downstream segment where Malaysia has little presence today by focusing on developing finished segments that generate high value, including oleo derivatives and selected food and health based segments.

Nonetheless, the palm oil industry continues to face challenges from environmental non-governmental organisations and a shortage of labour.

The industry is expected to require a workforce of 703,400, creating about 123,400 new jobs in the next 10 years. In a presentation at the Economic Transformation Programme (ETP) Open Day yesterday, it was also revealed that there was a target to reduce 110,000 foreign labour.

According to a statement on ETP, there are also three key sector-wide enablers that must be set up including increasing the number of university courses and graduates in chemical engineering, bio engineering and related courses to meet the demand for the nearly 80,000 skilled personnel in the palm oil industry.

Another milestone that the palm oil industry aims to achieve is to commercialise second-generation bio fuels from the resulting bio mass that is generated in the industry.

It is learnt that the implementation of the 5% mandatory biodiesel blend would be expanded to several areas in Malaysia by mid next year. It is currently only implemented in several government agencies.

This article appeared in The Edge Financial Daily, September 22, 2010.

New oil palm clone set to double palm oil yield up to 10 tonnes per ha

2010-09-28T03:05:00.000-07:00

KOTA KINABALU: A new oil palm clone dubbed Wakuba oil palm ramet brand was launched with a promise of doubling the current oil yield.

Named after TSH Resources Bhd unit TSH Biotech Sdn Bhd’s five-year-old tissue-culture laboratory in Wakuba Gading, Tawau, Sabah, the new clone promises an oil yield of up to 10 tonnes per ha compared with the average current yield of about 4.5 tonnes per ha in the country.

TSH Resources chairman Datuk Kelvin Tan said the company had invested RM25mil in the laboratory, which is expected to produce 1.5 million ramets by 2015 compared with 500,000 this year.

Plantation Industries and Commodities Minister Tan Sri Bernard Dompok launched the product in conjunction with the 2010 National Seminar on Palm Oil Milling, Refining, Environment and Quality here yesterday.

Dompok also witnessed the signing of a memorandum of agreement (MOA) between the Malaysian Palm Oil Board (MPOB) and TSH Resources.

MPOB was represented by its director-general Datuk Dr Mohd BasriWahid and TSH Resources by Tan.

The new MOA extends the technical collaboration on genetic marking to further improve efficiency and quality of ramets produced at the laboratory.

Tan said the project was initiated in 2005 between TSH Biotech’s laboratory and MPOB with technology transfer from MPOB to clone elite palm trees as part of of public and private sector initiative.

“We know that there is less land available in Sabah for oil palm so, we have to increase yield through technology,” Tan said.

Based on MPOB statistics, 1.1 million ha of the 1.4 million ha planted with oil palm in Sabah are now mature, indicating potential for high-yield Wakuba clones to replace ageing palms.

This collaboration will allow superior oil palm materials to be available especially to smallholders and plantations in Sabah.

At the current crude palm oil price, a smallholder with 6ha can potentially earn an incremental income of RM30,000 a year using cloned shoots, Tan added.

Meanwhile, Basri described the synergy between the two parties and success of Wakuba ramets as a landmark achievement for the clonal industry.

Commercialisation was an important element in research and development as this was where the concept of bench-to-market came into fruition, Basri said.

Dompok said the collaboration between MPOB and TSH Resources in setting up tissue culture lab was a success in the development and production of palm clones.

The achievement in oil palm breeding and biotechnology in producing high quality material would boost industry productivity and quality of palm oil products, he added.

Dompok also launched the TKJ organic fertiliser that is formulated using refinery waste which has potential to enhance soil fertility, promotes plant growth and improve yield and crop quality.

The high grade fertiliser was produced in a collaboration between MPOB and MPV Technologies.