Archive For: MPOA News

Anti-palm oil lobby threatening Livelihood of 650,000 smallholders

Anti-palm oil lobby threatening Livelihood of 650,000 smallholders

Between Oct 13 and Oct 21, 2017, a bi-partisan parliamentary committee comprising six MPs – led by Malaysian Palm Oil Board Chairman and Jasin MP Datuk Seri Ahmad Hamzah with Datuk Liang Teck Meng, Datuk Marcus Mojigoh, Datuk Seri Bung Mokhtar Radin, Datuk Zahidi Zainul Abidin and Dr Azman Ismail – spent nine days in Brussels, Belgium engaging with Members of European Parliament (MEPs) on Malaysia’s agriculture, forestry and environment policies.

The delegation had hoped that the engagements could persuade the European Parliament to reconsider its April 4 resolution to in­troduce a single certification scheme for palm oil entering the European Union (EU) market and phase out the use of palm biodiesel by 2020.

But alas, it was not to be.

If the EU eventually decides to accept what some MEPs are pushing for, then the livelihood of almost 650,000 smallholders, the core constituent of over two million people who work in the palm oil value chain, will be adversely affected.

However, it is a fact that the resolution can potentially be adopted by the European Commission into formal and binding EU regulatory process and given the anti-palm oil predilections of the EU, we cannot discount this possibility at all.

This is an affront to the spirit of the on-going Malaysia-EU Free Trade Agreement negotiation and will hurt the bilateral trade that recorded RM149.1bil in 2016.


Palm oil is the lifeblood of smallholders

Today, close to 40% of the total 5.74 million hectares of oil palm planted area in Malaysia are managed by smallholders. On an average, a smallholder with a planted area of 3.9ha can earn a monthly net income of between RM2,000 and RM2,100.

The success of commercial oil palm planting, which reached its 100th-year milestone this year, provided the Government with an effective tool to eradicate poverty especially in the rural area and create employment opportunities in the agriculture sector.

This is reflected by the success story of Felda in pioneering land development for the landless farmers and encouraging the planting of oil palm. It is also in line with the United Nations Sustainable Development Goals (SDG).

The palm oil industry in Malaysia is very strictly regulated.

There are more than 60 laws and regulations enforced, ranging from land clearing and planting to transportation and production, to ensure its development is sustainable and in line with good agricultural practices.

In addition, the laws and regulations ensure that there is a healthy balance between development and the preservation of the environment and the wildlife habitats.

The success of the palm oil industry is not without challenges.

There is no denying that negative perceptions have gathered pace in recent years, touching on issues including deforestation, emission of greenhouse gases, planting on peatland, land rights and workers’ rights.

There is little doubt that the time has come for the industry to rethink and rebrand the palm oil originating from Malaysia.

Setting high standards

Implementation of a credible certification system using a national standard, that includes sustainability policies that are consistent with broader national sustainability goals, is an effective and responsible manner to brand Malaysian palm oil.

The Malaysian Sustainable Palm Oil (MSPO) Certification Scheme aims to certify oil palm plantations, independent and organised smallholdings and palm oil processing facilities based on seven principles, addressing (i) management commitment and responsibility; (ii) transparency; (iii) compliance with legal requirements; (iv) social responsibility, health, safety and employment conditions; (v) environment, natural resources, biodiversity and ecosystem services; (vi) best practices; and (vii) development of new plantings.

The MSPO Certification Scheme addresses good agricultural practices, which are essential for sustainable agriculture, producing a high-quality product and enhancing productivity through yield optimisation as a result.

MSPO has the potential to raise the average yield of the small­holders from the current national average of between 14 to 16 tonnes of fresh fruit bunches (FFB) per year to as high as 20 to 25 tonnes of FFB per year, which translates into higher income for the 650,000 farmers.

Another key feature of MSPO is enhanced traceability from the farms and mills to products, giving assurance of sustainability adherence through the value chain.

We are exploring ways to create a digital identity for palm oil so that every step of the production process is captured and can be assessed to ensure it meets the highest standards.

To ensure this actually happens, we have engaged reputable international organisations such as Bluenumbers from New York.

MSPO also promotes awareness on environmental and social aspects of sustainability, among others reducing accidents at the workplaces and reducing waste, resulting in reduced running costs and higher profits.

The Government is committed to ensuring the palm oil industry is fully certified under MSPO by December 2019.

A dedicated agency, the Malaysian Palm Oil Certification Council, is set up for the purpose in part, and it is backed by RM130mil in funding to certify all smallholders.

In addition, estates between the size of 40.46ha to 1,000ha and those above 1,001ha are given a 70% and 30% incentive respectively to partially offset the audit cost.

Processing facilities including mills, refineries, and crushers will similarly receive a 30% incentive of the audit cost.

Stronger reaction may be unavoidable

Even as the West moves the goalpost from health to deforestation in its unfair, unwarranted and sometimes illegal attacks against palm oil, Malaysia stands tall, as we have consistently upheld the principle of balancing development with conservation.

In my last article, I showcased our major conservation initiatives such as the Central Forest Spine, Heart of Borneo and Malaysian Palm Oil Wildlife Conservation Fund, and I committed to doing all that we can to deliver even more.

Be that as it may, the development in the EU is extremely frustrating.

It conveniently rebuffs the efforts we have taken in all aspects, including multiple and continuous engagements to find a win-win resolution, and attempts to straitjacket its supposed better standards onus.

As the actions of the anti-palm oil MEPs and their supporters continue to harm the palm oil industry, we may have little choice but to react in stronger terms.

Malaysia has demonstrated in the past that we have the courage and conviction to do what is necessary to safeguard the interest of our citizens. It will be no different this time.

I will also be meeting all the ambassadors of all the EU member states and my message will be simple: work with us and not against us.

  • Datuk Seri Mah Siew Keong is Minister of Plantation Industries and Commodities. Commodities Today and Beyond is his op-ed to share his views, hope, and vision for commodities with everyday Malaysians.

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MPOA appeal to raise thresholds of Windfall Profit Levy

MPOA appeal to raise thresholds of Windfall Profit Levy

“Planters are facing an increasingly tough time with costlier production. There’s acute labour shortage and minimum wages is rising rapidly,” said Malaysian Palm Oil Association (MPOA) newly-appointed chief executive officer Datuk Mohamad Nageeb Ahmad Abdul Wahab.

In an exclusive interview with NST Business on oil palm planters aspirations for the upcoming Budget 2018, he noted MPOA renewed its appeal to the Plantation Industries and Commodities Ministry to adjust the Windfall Profit Levy thresholds, to better reflect business conditions.

Nageeb said since the implementation of Minimum Wages Order 2012 that took effect from January 2013, the rates have rapidly climbed to RM1,000 in Peninsular Malaysia, and RM920 for Sabah, Sarawak and Labuan.

Two weeks ago, Human Resources Minister Datuk Seri Dr Richard Riot Jaem said minimum wages are set to go up further from 1st January 2018.

Nageeb, who was formerly Sime Darby Plantation Sdn Bhd’s head of upstream, succeeded Datuk Dr Makhdzir Mardan whose contract has expired.

“MPOA is proposing the threshold level for Windfall Profit Levy in Peninsular Malaysia to be raised to RM3,000 per tonne. As for planters in Sabah and Sarawak, we suggest the new threshold level to be RM3,500 per tonne,” he said.

Currently, Nageeb said oil palm planters in Peninsular Malaysia pay a windfall levy of 15 per cent on the margin of palm oil pricing above RM2,500 per tonne in the cash market.

Planters in Sabah and Sarawak, however, pay this levy at a lower rate of 7.5 per cent on the margin if the price crosses RM3,000 per tonne.

On top of the windfall tax, oil palm planters also have to pay a 24 per cent corporate tax, an access amounting to RM13 per tonne of crude palm oil, as well as a 7.5 per cent and 5.0 per cent sales tax in Sabah and Sarawak, respectively.

When compared to businesses in other sectors that just pay 24 per cent of corporate tax, it is obvious that oil palm planters are the most heavily taxed in the country.

Oil palm planting is a capital-intensive activity.

Every year, planters have to chop down old and unproductive trees and replace them with higher yielding seedlings.

Planters, particularly smallholders, need to re-invest their profits to raise productivity at their fields.

Nageeb also took pains to highlight in the global export market, palm oil is already the world’s most heavily-taxed vegetable oil, with varying duties imposed by countries that buy palm oil.

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French hostility to palm oil trade hurting bilateral relations: MPOB

French hostility to palm oil trade hurting bilateral relations: MPOB

KUALA LUMPUR: France’s current adversarial position on the palm oil trade is hurting relations with Malaysia, Malaysian Palm Oil Board chairman Datuk Seri Ahmad Hamzah said today.

“French attacks on (the palm oil industry) are uncalled for and misguided. France should be cherishing 60 years of diplomatic relations with Malaysia,” he said.

Ahmad was responding to France Environment Minister Nicolas Hulot’s recent announcement that his country will close a window which offered the possibility of using palm oil in biofuels.

A couple of weeks ago, Hulot reportedly said France wants to stop “imported deforestation” and blamed unsustainable production of soybean and palm oil for impeding development in Latin America and Asia.

Hulot’s negative view of palm oil reflects that of Avril Group, Europe’s largest biodiesel producer. Avril Group uses French rapeseed as its main feedstock for biodiesel.

In the same news report, Avril chief executive Jean-Philippe Puig said his company supports all initiatives banning the usage of palm oil in biodiesel.

“Why is France vehemently attacking palm oil and undermining the opportunity for many families here to earn a decent living?” Ahmad asked, when contacted by NST Business today.

“Palm oil is a strategic commodity and the oil palm is a miracle crop,” he said, adding that oil palm planting and palm oil exports provide developing nations, such as Malaysia, a path out of poverty.

Ahmad rubbished allegations that oil palm planters cause rampant deforestation and provided evidence that Malaysian farmers have a good track record in efficient land use and conservation.

Oil palm trees yield four tonnes of vegetable oil per hectare, or 10, seven and five times the yields of soyabean, sunflower and rapeseed, respectively. At the same time, oil palms occupy less than five per cent of the world’s land under oil crop cultivation.

Ahmad adduced more studies from reputable science journals detailing that oil palm trees are actually the most environmentally-friendly among all oil crops such as rapeseed, soybean and sunflower.

This is because on a per-litre basis, palm oil production requires less energy, land and fewer fertilisers or pesticide usage compared to other vegetable oils.

Oil palms have an economic lifespan of 25 years, while its competitors like rapeseed, soya and sunflower need to be uprooted every four months during harvest, and that contributes to soil erosion.

Malaysia has 55 per cent of its land under forest cover. The corresponding figure for France is just 37 per cent.

Ahmad also highlighted that Malaysia earns between US$15 billion and US$20 billion from palm oil exports every year, which accounts for 8 per cent of Malaysia’s economy.

Businesses related to palm oil employ more than two million people in Malaysia, including close to 650,000 small farmers whose plantations account for 40 per cent of land under cultivation.

“The palm oil value chain is important in terms of employment, foreign exchange earnings and socio-economic interests of smallholders in bridging the rural and urban development gap,” he said.

Last year, the European Food Safety Authority raised potential health concerns over the consumption of palm oil over contaminants glycidyl fatty acid esters (GE) and 3-monochloropropanediol (3-MCPD).

Since that announcement, many food and beverage companies in Europe started boycotting palm oil.

In a separate interview, MPOB director general Dr Kushairi Din testified that many foods contain 3-MCPD and GE, including processed meats such as sausages and sauces, gravies and almost all vegetable oils.

“These substances, namely 3-MCPD and GE, are present in the everyday foods we eat. They are not confined to palm oil.”

He noted with disappointment when news reports sensationally cast aspersions on palm oil without evidence, as it often leads to public confidence erosion.

“As of now, there is no real evidence, based on human studies, that show that 3-MCPD and GE cause cancer. As professionals,

we must look at the facts and figures of palm oil nutrition,” he said.

Blurring the truth with narratives not grounded in facts just triggers public doubt, Kushairi added.

He urged responsible media practitioners to convey the facts and figures of sustainable practices by the palm oil industry.

“We need to assert the truth about baseless claims by irresponsible people who put up technical trade barriers to negate Malaysia’s exports and overall economy,” he added.



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Global palm oil output likely to rise by 6 million tonnes

Global palm oil output likely to rise by 6 million tonnes

KUALA LUMPUR: Global palm oil output is expected to increase by six million tonnes in 2017 as oil palm trees were recovering from the adverse effects of the El Nino, says a leading industry analyst Thomas Mielke.

He said the current good weather, particularly in Malaysia and Indonesia, the world’s top two producers was also aiding output.

In 2016, palm oil production was impacted by the El Nino, a warming of the Eastern Pacific Ocean waters which brings dry weather across Southeast Asia and lowers palm yields in top producers Indonesia and Malaysia.

Indonesia’s palm oil output was expected to reach 35 million tonnes in 2017 year from 32.10 million tonnes recorded in 2016 while Malaysia’s output would increase to 19.85 million tonnes from 17.32 million tonnes previously.

In October 2016, Mielke estimated that global palm oil output grew by 5.5 million tonnes.

“Replenishment of vegetable oil stocks will take time and will not be possible in 2016/2017 as we need a better year of good weather and high production,” he said at the Palm and Lauric Oils Price Outlook Conference and Exhibition in Kuala Lumpur on Wednesday.

On palm oil prices, Mielke, who is also editor of the Hamburg-based Oil World newsletter said the price setback should be moderate as long as palm oil stocks remained small.

He said price peaked to RM3,300 per tonne in the first quarter of this year, but would stay below soybean oil prices in coming weeks and for the rest of the year.

“Some recovery is likely to be seen in the next three to six weeks because of the prospects of strong demand, globally. With more purchases from consumers, prices would rise sizably,” he said.

Meanwhile, Mielke was of the opinion that global vegetable oil imports had increased to meet current demand.

For 2017, he forecast that yield would recover but remain below average level. – Bernama

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Let’s light up palm oil history

Let’s light up palm oil history

The industry’s centenary this year is a learning opportunity not to be wasted

THE Malaysian palm oil industry turns 100 this year. Pinpointing the start of an industry this old is often tricky, but in this case, the birth is widely recognised as the first time that oil palm was planted commercially in this country.

That was in 1917. The birthplace was Tennamaram Estate in Batang Berjuntai, Selangor, and the man responsible was a planter from France named Henri Fauconnier, who later became an award-winning writer.

Sime Darby Bhd now owns the plantation. Batang Berjuntai, from a Malay term that’s usually translated as dangling branch or stick, has been given a less suggestive name – Bestari Jaya.

And of course, palm oil has become a cornerstone of the Malaysian economy, a significant factor in the capital market, and one of the country’s sociopolitical levers. It’s certainly a birthday worth celebrating.

Yes, it’s nice and appropriate to organise some merrymaking to commemorate the centennial, but what’s more likely to have a lasting impact is solid and searching storytelling on how the industry has grown to be what it is today.

This can be in many forms (books, articles, TV segments and shows, documentaries, short videos, talks, panel discussions, exhibitions, websites) as long as it helps people understand what it took for oil palm to progress from decorative plant to Malaysia’s golden crop.

On one level, the industry’s story is not very different from those of other industries. Palm oil has become big as a result of hard work, innovation, foresight, sound strategies, entrepreneurship, government support and, sure, luck.

But when we look closer, we’ll see that Malaysia’s experience with palm oil is a treasure trove of unique lessons.

For example, before oil palm took over as the country’s dominant cash crop, there was rubber.

The pivot from rubber to oil palm is a fascinating tale of threat transformed into opportunity, of adaptability paving the way for prosperity.

The transition to oil palm was also boosted by the drive to lift the fortunes of the rural poor through the Federal Land Development Authority (Felda).

With more and more settlers on the Felda schemes cultivating oil palm, it surpassed rubber in 1989 as Malaysia’s main economic crop.

By itself, Felda’s 60-year history is already a powerful saga of government intervention and human endeavour.

The longevity of some of our plantation players gives us another rich source of wisdom, anecdotes and records relating to the palm oil industry.

And there are many other palm oil-related institutions in the private and public sectors that have been around for decades. What they’ve done and gone through, can go a long way in preparing us for the years ahead.

It’s a shame if there’s no attempt to highlight and explain key industry developments and their consequences. It’s equally important to showcase the contributions of pioneers and leaders in palm oil.

A 100-year journey surely has its share of wrong turns and casualties, and these should not be swept under the carpet. Sometimes we learn more from failure than from success.

No matter how old, no industry is free of challenges. The global sustainability agenda demands that palm oil growers convince people that the business does little harm to communities and the environment. The industry’s productivity levels have been stagnant for a long time; a breakthrough is much needed.

This is yet another reason for a long, retrospective look at the last 100 years of palm oil. The answers to a brighter future may well lie in the past. To search, we must first illuminate history.

Executive editor Errol Oh has a soft spot for the palm oil industry. His late father had worked only in plantations.

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Cabinet agrees to postpone levy payment on foreign workers to 2018

Cabinet agrees to postpone levy payment on foreign workers to 2018

PUTRAJAYA, Jan 11 — The Cabinet has agreed to postpone to next year, the implementation of levy payment on foreign workers by employers, which will be enforced under the Employer Mandatory Commitment (EMC).

Transport Minister Datuk Seri Liow Tiong Lai said the Cabinet today, had also agreed to look into a proper ecosystem, aimed at providing convenience to industries in hiring foreign workers, and to ensure the country’s economic growth.

Datuk Seri Liow Tiong Lai said the Cabinet had agreed to postpone until 2018 the implementation of levy payment on foreign workers by employers under the Employer Mandatory Commitment (EMC). — File picDatuk Seri Liow Tiong Lai said the Cabinet had agreed to postpone until 2018 the implementation of levy payment on foreign workers by employers under the Employer Mandatory Commitment (EMC).

He said the decision was made after a presentation by Minister in the Prime Minister’s Department Datuk Paul Low who gave the overall picture pertaining to the EMC.

“It is not just on levy, but on the rights of the employer to have direct access towards the workers, rather than going through a middle man, how to cut down bureaucracy procedures and how to have fast employment of foreign workers.

“At the meeting, we also voiced out the need to regulate employment of foreign workers and ensure it can support our economic growth, without giving problem to our social issues,” he told reporters here today.

On Dec 31, Deputy Prime Minister Datuk Seri Dr Ahmad Zahid Hamidi, who is also home minister, had announced employers would be responsible for paying the levy of their foreign workers which would be enforced under the EMC.

Under the scheme, the employers would be disallowed from deducting the levy from the wages of their workers.

Yesterday, construction industry players wanted the EMC to be scrapped as it did not benefit the country.

Liow said Prime Minister Datuk Seri Najib Razak had agreed to look into these matter personally and would coordinate with the home ministry and human resources ministry to “take care of whatever hiccups” to resolve the issue.

“The Cabinet is clear that our foreign worker policy must be vibrant and able to solve the present shortage of foreign workers in the country,” he said, adding the Cabinet Committee on Foreign Workers would meet soon. — Bernama

Source:, 12 January 2017

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Nutella maker defends palm oil

Nutella maker defends palm oil

Ferrero runs TV commercial to allay fear over cancer risk

ALBA: The US$44bil palm oil industry, under pressure in Europe after authorities listed the edible oil as a cancer risk, has found a vocal ally in the food sector: the maker of Nutella.

Italian confectionery firm Ferrero has taken a public stand in defence of an ingredient that some other food companies in the country are boycotting. It has launched an advertising campaign to assure the public about the safety of Nutella, its flagship product which makes up about a fifth of its sales.

The hazelnut and chocolate spread, one of Italy’s best-known food brands and a popular breakfast treat for children, relies on palm oil for its smooth texture and shelf life. Other substitutes, such as sunflower oil, would change its character, according to Ferrero.

“Making Nutella without palm oil would produce an inferior substitute for the real product, it would be a step backward,” Ferrero’s purchasing manager Vincenzo Tapella told Reuters. He features in a TV commercial aired in Italy over the past three months that has drawn criticism from some politicians.

Any move away from palm oil would also have economic implications as it is the cheapest vegetable oil, costing around US$800 a tonne, compared with US$845 for sunflower oil and US$920 for rapeseed oil, another possible substitute.

Enriched by palm oil: Nutella chocolate-hazelnut paste relies on palm oil for its smooth texture and shelf life. – Reuters

Enriched by palm oil: Nutella chocolate-hazelnut paste relies on palm oil for its smooth texture and shelf life. – Reuters

Ferrero uses about 185,000 tonnes of palm oil a year, so replacing it with those substitutes could cost the firm an extra US$8mil-US$22mil annually, at those prices. The company declined to comment on these calculations.

The European Food Safety Authority (EFSA) said in May that palm oil generated more of a potentially carcinogenic contaminant than other vegetable oils when refined at temperatures above 200 degrees Celsius. It did not, however, recommend consumers stop eating it and said further study was needed to assess the level of risk.

The detailed research into the contaminant – known as GE – was commissioned by the European Commission in 2014 after an EFSA study the year before, into substances generated during industrial refining, identified it as being potentially harmful.

EFSA does not have the power to make regulations, though the issue is under review by the European Commission. The spokesman for Health and Food Safety, Enrico Brivio, said guidance would be issued by the end of this year. Measures could include regulations to limit the level of GE in food products, but there would not be a ban on the use of palm oil, he added.

The World Health Organisation and the UN Food and Agriculture Organisation flagged the same potential risk that EFSA had warned of regarding GE, but did not recommend consumers stop eating palm oil. The US Food and Drug Administration also has not banned the use of palm oil in food.

The issue became a hot consumer topic in Italy after the largest supermarket chain, Coop, boycotted palm oil in all its own-brand products following the EFSA study, describing the move as a “precaution”. Italy’s biggest baker, Barilla, also eliminated it and put “palm oil-free” labels on its wares.

The retailers’ decisions followed pressure from activists, including Italy’s main farming association Coldiretti and online food magazine Il Fatto Alimentare, which called on all food firms to stop using palm oil.

High temperatures are used to remove palm oil’s natural red colour and neutralise its smell, but Ferrero says it uses an industrial process that combines a temperature of just below 200ºC and extremely low pressure to minimise contaminants.

The process takes longer and costs 20% more than high-temperature refining, Ferrero told Reuters. But it said this had allowed it to bring GE levels so low that scientific instruments find it hard to trace the chemical.

“The palm oil used by Ferrero is safe because it comes from freshly squeezed fruits and is processed at controlled temperatures,” Tapella says in the TV ad, which was filmed at the firm’s factory in the northern town of Alba and was accompanied by full-page ads in newspapers carrying the same message.

EFSA declined to comment on the possible risks of refining palm oil at lower temperatures.

Ferrero is by no means the only big European food firm to keep using palm oil in its products since the EFSA report. The likes of Unilever and Nestle use it in products including chocolate, snacks and margarine.

The two companies said they were monitoring the contaminant issue and were working with their suppliers to keep GE at lowest possible levels.

Ferrero is the only big European food company to mount such a public defence of the use of the ingredient in its products following the EFSA opinion.

The company told Reuters it carried out “hundreds of thousands of tests” on contaminants in both the palm oil it uses and finished products.The palm oil industry, dominated by producers in Malaysia and Indonesia, believes Ferrero is playing an important role in addressing what it regards as misconceptions among consumers.

“It is good that Ferrero has clarified that the palm oil they use is safe and sustainable,” said Tan Sri Yusof Basiron, chief executive of the Malaysian Palm Oil Council.

He said Malaysian producers had not suffered any impact on their European exports after the EFSA opinion. The Indonesian Palm Oil Association also said there had been no impact. – Reuters

Source : The Star, 12 January 2017

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Oil palm planters to benefit from strong dollar, limited supply

Oil palm planters to benefit from strong dollar, limited supply

KUALA LUMPUR: OIL palm planters can look forward to encouraging palm oil pricing on the back of a strong US dollar and limited supply of the oil as palm trees are still recovering from the El Nino weather phenomenon. In the past two years, oil palm trees have been bearing less fruit. This year, palm oil production in Indonesia and Malaysia, which account for 85 per cent of the global supply, is forecast to fall by five per cent to 58.8 million tonnes. In an interview with Business Times, Malaysian Palm Oil Association (MPOA) chairman Datuk Franki Anthony Dass said next year’s oil palm fruit production should recover from the El Nino but the rise in quantum is difficult to forecast. “There are still the lagging secondary El Nino effects,” he said. For the past month, palm oil futures on Bursa Malaysia averaged above RM2,900 per tonne. “If we look at the movements in palm oil futures, they have a direct relation with the strength of the US dollar. The strengthening of the US dollar is having a favourable impact on palm oil prices.” Ongoing biodiesel mandates in Indonesia and Malaysia are also fuelling support for palm oil pricing. This value-adding mechanism has helped bring down national palm oil stocks. On Bursa Malaysia, plantation stocks are showing an improved performance.  In a note to investors, Public Investment Bank Bhd said many plantation companies are showing better results in the quarter of July to September. The research house said IOI Corp Bhd, Ta Ann Bhd and TSH Resources Bhd’s financial results are within its expectations while Genting Plantations Bhd posted better-than-expected results, bolstered by a huge jump in upstream plantation business.  TDM Bhd achieved the highest average palm oil price for the quarter at RM2,631 per tonne, followed by Genting Plantations at RM2,617 per tonne while Ta Ann’s RM2,412 per tonne was the lowest.  The plantation sector saw lower fruit production as a result of the lagged effect from the super El Nino.  Only Genting Plantations and Ta Ann harvested more oil palm fruits while Felda Global Ventures Holdings Bhd (FGV), IOI Corp, Sime Darby Bhd, TDM and TSH posted quarter-on-quarter decline in production, albeit at a smaller pace.  TDM suffered the sharpest production drop in oil palm fruits, down 26.7 per cent, followed by Sime Darby (-23.6 per cent). FGV had also seen 14.4 per cent decline in its oil palm fruit production in its latest quarterly results. The research house upgraded Sime Darby from “neutral” to “outperform” as it sees the likelihood of unlocking potential value via a demerger exercise given the current bullish sentiment for palm oil prices.  “We maintain our call on TDM as we believe it will be able to catch up in the fourth quarter given the stronger palm oil prices.” It is keeping its “outperform” call on Genting Plantations, with a higher target price of RM12.51.  “We expect to see another round of impressive earnings in the final quarter. Palm oil futures is likely to stay above RM3,000 per tonne due to tight inventories. We retain our ‘overweight’ stance on the plantation sector. “On the other hand, we revised our target price for FGV from RM2 to RM1.77 as the company will face another loss-making quarter due to its kitchen-sinking exercise,” it added.
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Proposed Amendments To The MPOB ACT 1998 (ACT 582) – Call for Views

Proposed Amendments To The MPOB ACT 1998 (ACT 582) – Call for Views

To : All Registered Members

Please be informed that MPOB has proposed several amendments to the MPOB Act relating to commercialization, enforcement and investments. Attached are the detailed proposed amendments to the various sections of the Act for your kind attention.

MPOB Act Proposed Amendments.pdf

We would appreciate receiving your views/comments on or before 18 November 2016 for collation by the Secretariat and onward submission to MPIC accordingly. You can email your feedback by fax or email to


Thank you.

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Malaysia delays B10 biodiesel mandate amid rise in palm oil prices

Malaysia delays B10 biodiesel mandate amid rise in palm oil prices

KUALA LUMPUR: Malaysia has decided to delay the B10 biodiesel mandate as palm oil prices have risen considerably, said Plantation Industries and Commodities Minister Datuk Seri Mah Siew Keong. “For the past couple of weeks, we’ve seen the gap between palm oil and diesel prices widening at the current volatile market,” he told Business Times in an interview today. “Palm oil prices has risen considerably to near RM3,000 per tonne last week. This week it has come down a bit but still at a supportive level for oil palm planters,” he said. “In this situation, it is best to defer the implementation of B10 biodiesel mandate for the transportation sector and B7 in industrial sector,” he said. The minister explained that if the government were to raise the current biodiesel mandate of B7 to B10, diesel price at the pump will go up and burden many people. The biodiesel B10 is a blend of 10 per cent palm methyl ester (PME) and 90 per cent regular diesel while B7 is of a lower blend of 7 per cent PME. “My role in the government is to balance the needs of a diverse set of stakeholders, including diesel consumers,” he said. Under the Malaysian Biofuel Industry Act 2006, the Plantation Industries and Commodities Minister is empowered to raise and lower Malaysia’s biodiesel mandate. When the government mooted the biodiesel programme, more than a decade ago, the rationale is to help bring down the nation’s palm oil stocks and support prices in the international market. The palm oil industry is very important to Malaysia’s economy as it supports more than two million livelihoods and jobs. 160

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