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PRESS STATEMENT
MPIC REMAINS COMMITTED TO IMPLEMENTING MALAYSIA NATIONAL
BIOFUEL POLICY (NBP)

1. The Ministry of Plantation Industries and Commodities (MPIC) assured the Malaysian Biodiesel Association (MBA) that the Ministry is all ears to the group’s proposal that Malaysia should retain its existing biodiesel mandate after all.

2. MBA highlighted why Malaysia should not reduce or stop its biodiesel mandate as the biodiesel industry hardly consumes 1 million tonnes of palm oil annually as opposed to over 40 million tonnes used globally. In expressing its views, the MBA had mentioned that any knee-jerk reaction to banning biofuels derived from vegetable oils would cause havoc in the global vegetable oil market.

3. Nevertheless, it has to be highlighted that the concerns came at a ‘chaotic moment’ where MBA was reacting to a viewpoint by the Malaysian Palm Oil Board (MPOB) a day earlier – on April 25, being precise – that both palm oil exporting and importing countries should set their priorities right by “temporarily re-considering food versus fuel priorities.”

4. Recall that there was an air of desperation back then – Malaysia’s neighbor and the world’s largest palm oil exporter, Indonesia, was on the verge of putting to a halt its shipments of refined, bleached, and deodorized (RBD) palm olein. This prompted MPOB’s director-general Datuk Dr. Ahmad Parveez Ghulam Kadir –an all-around palm oil expert– to convey such views against the
backdrop of a choke in global edible oil supplies amid both adverse weather conditions and the Russia-Ukraine conflict.

5. Needless to say that disruptions from the geopolitical tension have exacerbated price rises in food commodities which were already running at 10-year highs in the Food and Agriculture Organization's (FAO) index – threatening not only a jump in global malnourishment but a spike in global inflation across both developed, developing and under-developed economies.

6. True enough, Indonesia declared an export ban on April 28 on cooking oil and its raw material (which lasted until May 23) in the quest to make cooking oil available at affordable prices for its citizens.

7. But now that normalcy has resumed and calmer heads have prevailed, MPIC wishes to state that it is all status quo on Malaysia’s biodiesel mandate front. On the same note, MPIC wants to take the opportunity to reiterate that Malaysia’s National Biofuels Policy (NBP) which was rolled out in March 2006, remains committed:

 To reduce the greenhouse gas (GHG) emissions rate in line with the
country’s aspiration towards achieving the GHG emissions reduction
target of 45% of GDP by 2030.
 To expand the use of downstream palm oil products and become an
initiative to increase the income of oil palm smallholders through palm
oil market price control mechanisms.
 To help reduce the country's dependence on fossil fuels as one of the
energy security initiatives.

8. To MBA, we thank them for their invaluable feedback on our big role and the effect of the biofuel policy towards conserving nature for younger generation Malaysians. We welcome all constructive criticism or views that can enable both sides of the divide – authorities or industry players – to derive a win-win situation.

YB DATUK HAJAH ZURAIDA KAMARUDDIN
MINISTER OF PLANTATION INDUSTRIES AND COMMODITIES
2 JUNE 2022

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MEDIA STATEMENT
PALM KERNEL WASTE AS ANIMAL FEED TO CONTROL PRICES
AND STABILISE CHICKEN SUPPLY IN THE COUNTRY

1. THE Ministry of Plantation Industries and Commodities (MPIC) will step up efforts to promote the use of palm kernel waste as animal feed to ensure Malaysia has sustainable supply of chickens in the long run.

2. As we know, one of the reasons why chicken prices sometimes soar is due to the high price of chicken feed. It has been reported that chicken feed had gone up from RM500 per tonne to RM1,900 per tonne in some cases.

3. As a result, chickens were being fed less, causing the livestock to grow slower than normal, and in the process restricting the supply of the birds. Malaysia imports most of its chicken feed, mostly made of grain like corn and soybean. These items are facing worldwide shortage due to the war in Ukraine and uncertain weather patterns.

4. However, Malaysia's oil palm plantations produce huge supplies of palm kernel waste. Past researches have shown that feeding fermented palm kernel cake (PKC) and high dietary fat to broilers, can be a good substitute for the imported feed which almost all commercial chicken farms use today.

5. The MPIC will also hold discussions with other stakeholders to review our export policy on PKC in favour of local broilers. Right now, a lot of our PKC is exported for the European cattle industry.

6. The Ministry will also work with relevant agencies, government-linked companies (GLCs) and State Governments to urgently look into how it can quickly ensure the availability of palm kernel waste as animal feed for the Malaysian poultry industry.

7. Additionally, the MPIC will also be working closely with research institutes such as public universities to look into ways to enhance the quality of PKC to make it the preferred choice for chicken breeders. This includes ways of reducing the fibre content in the PKC.

8. MPIC is committed to playing its part to help reduce Malaysia’s dependence on imported livestock feed, in the spirit of Keluarga Malaysia. At the end of the day, it's about putting the interests of the people first and The Ministry is determined to ensure the commodity sectors consistently contribute to the country’s economic development.

YB DATUK HAJAH ZURAIDA KAMARUDDIN
31 MAY 2022

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MEDIA RELEASE
KEYNOTE ADDRESS OF MINISTER OF PLANTATION INDUSTRIES AND
COMMODITIES AT THE MALAYSIAN-BRITISH PARTNERSHIP FORUM,
“65 YEARS AND BEYOND” AT THE CALEDONIAN CLUB, LONDON

1. The UK and Malaysia have enjoyed 65 years of diplomatic relations since the Federation of Malaya’s independence in 1957. This year also marked the 70th year of Her Majesty Queen Elizabeth II acceded to the throne of the British monarch. As we are all aware, Her Majesty The Queen is the first British monarch to celebrate a Platinum Jubilee, marking 70 years of service to the people of the United Kingdom, the Realms and the Commonwealth.

2. Our partnership is founded firmly on common values :

• Respect for the independence, sovereignty and territorial integrity of all nations
• Mutual respect and benefit
• A commitment to rules-based trade and to low-carbon development to tackle
climate change
• Respect and promotion of the rule of law and human rights
• Advancement of international law and multilateralism and the promotion of
peace, security and prosperity in line with the United Nations and
Commonwealth Charters

3. The UK is Malaysia 19th largest trading partner. In 2021, the total trade of goods and services for both countries accounted for £5.2 billion. Malaysian export of agricultural commodities (Palm Oil, Rubber, Timber, Cocoa and Pepper) contributed to 14% of the total trade, valued at £734 million. This agriculture trade export has shown an increase of 17% compared to 2020, which is £628 million.

4. As the UK has shown interest in ensuring that agricultural commodities entering the UK are sustainably sourced, Malaysia has been working closely with the UK to ensure that the voice of producing countries like Malaysia are heard and any new laws to be enacted that may affect the trade exchanges are in line with the spirit of the United Nations Sustainable Development Goals (UNSDG) as a whole – economically, socially and environmentally.

5. We also showed our support during UK’s Presidency of the 26th Conference of Parties (COP 26) last year and contributed to the Glasgow Declaration on Forests and Land used. In relation to that, we are committed to strengthening our cooperation through the Forest, Agriculture and Commodities Trade Dialogue (FACT Dialogue) where we were tasked as the co-facilitators for the Smallholder Support Working Group. Malaysia’s Sustainability Efforts in Commodities

6. Sustainability has always been the central theme of Malaysia’s economic policy direction throughout the years from the National Economic Policy (NEP) in the 1970s, New Economic Model (NEM) in 2009, Vision 2020 and the latest Shared Prosperity Vision 2030.

7. Sustainability has always been associated with deforestation. However, it is crucial to note that sustainability is more than just forests. The United Nations'definition of sustainability is clear: social and economic sustainability is on an equal plane with environmental. So, the Malaysian Government is also focused on supporting small farmers and their economic communities. Among the initiatives includes developing infrastructure, granting financial assistance where needed, and protecting the ability of small farmers to earn a living.

8. Our sustainability practices recognises how these issues are interconnected and requires a systematic approach. MPIC stands guided by the action plans of the UNSDGs blueprint, particularly on:

• Goal 1 (No Poverty)
• Goal 2 (Zero Hunger)
• Goal 8 (Decent Work and Economic Growth)
• Goal 9 (Industry, Innovation and Infrastructure)
• Goal 12 (Responsible Consumption and Production)
• Goal 15 (Life on Land)
• Goal 17 (Partnerships to achieve the Goal)

9. Taking an example from the palm oil industry, I want to stress that the Malaysian palm oil industry now focuses on improving productivity and yields rather than expanding land for cultivation. Forest protection is a priority for our government. Malaysia also assures the world that it will not retreat from its 1992 Earth Summit pledge on sustainable development – it will keep at least 50% of its total land area under permanent forest. Malaysia has also committed to plant '1 million forest trees species within the next ten (10) years'.

10.Another important measure taken by the Malaysian Government through the Ministry of Plantation Industries and Commodities (MPIC) is the introduction of the Malaysian Sustainable Palm Oil Certification (MSPO) in 2015, which was made mandatory starting from January 2020. The MSPO Certification Scheme ensures that Malaysian palm oil is sustainably produced and safe for consumption. It also seeks to reduce the industry's social and environmental impacts and help independent smallholders certify their palm oil for the export market. In addition, the certification ensures the country's palm oil industry complies with international sustainability requirements encompassing the whole supply chain, from growers and millers to traders and retailers.

11.MPIC through the National Agri-commodity’s Strategic Plan is also committed to ensure that other commodities will have their own certification systems in the future. Circular Economy

12.Integrating a circular economy into the production of Agri-commodities, particularly palm oil, is an effective solution to optimise the usage of resources (raw materials) and minimise wastage from production, emissions and energy inefficiency.

13.This is done by reducing, reusing and recycling materials commonly underutilised in the current linear economy. The model adopts a circular pathway which utilises usable materials after the first processing cycle by reintroducing it back into the second processing cycle of similar or different products as secondary raw materials. Ultimately, this process will translate into optimising raw materials by continually adding value to its users along the supply chain.

14.Production of palm oil results in multiple types of secondary products (solid and liquid) in high volumes, such as Palm Oil Mill Effluent (POME), Empty Fruit Bunch (EFB), decanter cake and palm pressed fibres. These biomass products can be further utilised directly to produce new value-added products or as alternative energy sources to fuel the production facility.

15.The incorporation of this model will not only address the environmental aspect plaguing the palm oil industry but also the economic concern of the supplies of primary raw materials. MPIC is also planning to expend the circular economy technology to other Agri-commodities such as rubber, pepper and Kenaf to ensure a more effective and sustainable waste management.

16.As the industry embarks on reusing its waste, the reliance on primary sources will diminish. This contributes to reducing deforestation and lowering our carbon footprint. Introducing new usages of secondary products will also bring about new economic opportunities. Furthermore, it could significantly disrupt the current energy industry by increasing the accessibility to biomass as an energy alternative, in tandem with the world's commitment to decarbonising its economy by reducing its reliance on fossil fuels.

17.I wish to highlight that Malaysia has been at the forefront of promoting palm oil and palm biomass in the manufacturing sector. The National Biomass Strategy 2020 (NBS2020) set a target to turn palm biomass into higher-value products that will create an incremental gross national income (GNI) of £5.5 billion (RM30 billion) and 66,000 new jobs while attracting £4.6 billion (RM25 billion) in investment and reducing carbon emissions by 12%.

18.The circular economy model is undoubtedly the way forward for Malaysia’s Agri-commodity sustainable and ethical sourcing. Despite the challenges of integrating, it into the current linear model, the focus would be to create more value. There is much value extracted from reusing and recycling these raw materials.

CLOSING REMARKS : Malaysia – UK Partnership Opportunities

19.Malaysia opens its doors to work with international parties including government agencies, academicians, research institutes, industry players and businesses to ensure the Agri-commodity industry continues to develop progressively and sustainably.

20..Looking at sustainability and circular economy, we realise that we have to work with many stakeholders and potential tech players to harness the latest technology to further explore the full potential of Agri-commodities production. There is a need for better facilities, more advanced technologies and substantial investments into the industry to ensure a competitive edge against
traditional practices.

21.I hope this forum can further look into the possible opportunities for partnerships between our countries and strengthening both countries' national economic agendas.

22.On that note, I wish all delegates and participants of the Malaysia – British Partnership Forum a fruitful discussion. *The keynote address was delivered during the Malaysian British Partnership, “65 Years and Beyond” held at The Coledonian Club, 9 Halkin St, London on 17th May 2022

YB DATUK HAJAH ZURAIDA KAMARUDDIN
MINISTER OF PLANTATION INDUSTRIES AND COMMODITIES
25 MAY 2022

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Last Updated: 21 June 2022

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MEDIA RELEASE
MALAYSIA WILL NOT LOSE COMPETITIVE EDGE AS INDONESIA RESUMES
PALM OIL EXPORT

With regard to the latest move by our neighbour Indonesia who is also the world’s largest palm oil producer to lift the ban on palm oil exports effective May 23, the Ministry of Plantation Industries and Commodities (MPIC) wishes to urge all Malaysian oil palm growers – both plantation firms and smallholders alike – not to be unduly concerned with the recent development.

While a knee jerk correction in palm oil price is inevitable given such a move will somehow ease concerns over vegetable oil supply, MPIC does not expect a big downward adjustment to CPO prices as the market is well aware that this ban was always going to be temporary.

Moreover, the recent weakening of crude palm oil (CPO) prices could have already factored in this possibility. Market analysts expect Malaysian planters to be the largest winners on the long run as they are able to sell their CPO at high spot prices which should translate into higher profit margin in 2Q 2022 coupled with higher production year-on-year (y-o-y) and quarter-on-quarter (q-o-q).

While the export ban lifting is a big relief to Indonesia planters, they have certainly missed out on the high CPO price period (February-April 2022) when Indonesia palm oil prices were trading at a larger discount to Malaysia with all the export control policies put in place since late-January 2022.

BIG ADVANTAGE

Indonesia’s policies could well work to Malaysia’s advantage as the world’s second largest palm oil producer, given this would enable it to emerge a dominant supplier to India which is the world’s top buyer of the edible oil. The combination of Malaysia’s lower export taxes and the Indonesian ban may mean Indonesia’s share of palm oil exports to India will fall to 35% in the current marketing year ending on Oct 31 from more than 75% a decade ago, according to an estimate from the Solvent Extractors' Association of India (SEA), a vegetable oil trade body.

In the first five months of the 2021/22 marketing year, India bought 1.47 million tonnes of Malaysian palm oil compared to 982,123 tonnes from Indonesia, data compiled by SEA showed. Trader estimates for May show India imported around 570,000 tonnes of palm oil with 290,000 from Malaysia and 240,000 from Indonesia.

Above all else, MPIC believes that CPO prices will remain at elevated levels going forward given the output uncertainties on major oilseeds (such as soybean, corn, rapeseed and sunflower seed) either due to geopolitical tensions or unfavourable weather.

Lastly, even as Indonesia would resume its palm oil exports on May 23 (Monday) – barely a month after imposing the ban on April 28 – it may not end there given palm oil prices in its domestic market have yet to come down to the desired level (in fact, lifting of the ban could result in a recurrence of domestic shortage in the country).

Given that the medium- to long-term outlook of the Malaysian palm oil industry remains bright, MPIC wishes to call on all Malaysian oil palm growers to join hands in helping to make the Malaysian Palm Oil Full of Goodness campaign which seeks to counter various misperceptions with regard to Malaysian palm oil a global success.

YB DATUK HAJAH ZURAIDA KAMARUDDIN
MINISTER OF PLANTATION INDUSTRIES AND COMMODITIES
22 MAY 2022