Tuesday, February 25, 2020

Malaysia minister upbeat on palm oil prices

Mar 08. 2017
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By  THE STAR
ASIA NEWS NETWORK
KUALA LUMPUR

MALAYSIAN Plantation Industries and Commodities Minister Mah Siew Keong hopes that crude palm oil (CPO) prices will continue to trend at higher levels, especially since the country has some 600,000 smallholders.

He maintained his CPO price projection at RM2,700 (Bt2,130) to RM2,800 per tonne this year, higher than last year’s average price of RM2,653 per tonne and RM2,513 per tonne in 2015.

“We hope that this year’s CPO price will continue to be good, but there are a lot factors that could impact it,” said Mah, adding that the Malaysian Palm Oil Board (MPOB) had not set any target on the number of stakeholders under the programme.

However, he noted that there would be more trade visits to expand into new markets and increase exports to existing markets.

Last year, Malaysia’s global exports amounted to RM67 billion and the target this year is RM70 billion, according to Mah.

The government is allocating RM50 million in the form of a research grant to enhance the quality and safety of Malaysian palm oil products.

Mah said the grant would help facilitate more research and development work in the palm oil industry to bring food safety standards to a higher level.

“The research grant will be a matching grant and open for application to stakeholders such as mills and refineries that are based here (in Malaysia), with majority stakes owned by Malaysians,” Mah said.

“Preference will be given to independent mills and refineries, which are licensed by MPOB and the Malaysian Investment Development Authority.”

The RM50 million research grant was announced in conjunction with 100 years of commercial oil palm planting in Malaysia at the 28th Global Palm and Lauric Oils Conference in Kuala Lumpur this week.

He insisted that palm oil and its derivatives were safe for consumption and that Malaysia, being a major producer and exporter of the commodity, would continue to take measures to address food safety concerns and reduce the level of contaminants in palm oil.

On the export duty structure between Malaysia and Indonesia, Mah said this remained an issue as the price structures between the two nations were different.

“We have got various feedback from the upstream and downstream players to request for different export duty structures. It’s not going to be easy. We hope to discuss this further with Indonesia as it is the world’s biggest exporter and we are No.2.” the minister said.

“And we hope to be able to harmonise the CPO export duty structures of both countries. We do not wish to compete with Indonesia, but we want to work together with a standard price structure.”

According to the Plantation Industries and Commodities Ministry secretary-general M. Nagarajan, Malaysia’s export duty structure was only for CPO, while Indonesia’s export duties covered a range of products. The export duty is higher on raw materials and lower on processed products.

In January, Mah said Malaysia was open to negotiations with Indonesia on the possibility of harmonising the CPO export duty structures of both countries.

 

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