By RAHIMI YUNUS / Pic By MUHD AMIN NAHARUL
The Malaysia-Indonesia palm oil pact is set to become larger as Colombia has pledged to help the South-East Asia nations to counter the European Union’s (EU) negative narrative on the key commodity.
Deputy Minister of Primary Industries Datuk Seri Shamsul Iskandar Mohd Akin (picture) said Colombia has agreed to collaborate with Malaysia and Indonesia to form a bigger bloc and address the issues faced by the palm oil industry.
“We have conveyed our interest to have a discussion and collaboration with Indonesia. Colombia has agreed to join us as well.
“Now, I think we will have a better representation and form a better bloc to push the palm oil industry,” Shamsul Iskandar said at the National Kenaf Industry Conference 2018 in Kuala Lumpur yesterday.
He said Colombia’s success, which markets 50% of its palm oil to European markets, would lend to the producing countries’ arguments.
He said Malaysia had proposed an agreement called the Cartagena Consensus during a recent mission to Colombia and the proposal had been warmly received by the South American country.
He said the agreement would pave the way for discussions on issues such as the EU’s campaign against palm oil, taxes imposed on the product and prices of the commodity.
Malaysia and Indonesia are the world’s biggest palm oil producers with an output of about 20 million metric tonnes (MT) and 40 million MT per annum respectively, supplying 83% of the global need.
Malaysia will lead the Council of Palm Oil Producing Countries (CPOPC) this year as chairmanship rotates after Indonesia and the drive to provide the true, unbiased narrative of palm oil from a local perspective is expected to gain momentum next year.
Shamsul Iskandar said the government has approved a bigger budget of RM23.4 million for the palm oil campaign compared to RM2 million allocated by the previous government.
He said the CPOPC will hold its first ministerial meeting in early November.
The European Commission is expected to hold a consultation process with Malaysian palm oil industry stakeholders this week which include plantations site visits, EU Ambassador and head of delegation to Malaysia Maria Castillo Fernandez said last week.
The European Parliament is revisiting its Renewable Energy Directive, designed to boost renewable energy use in the EU which would see palm oil barred from being used in motor fuels by 2021.
The original directive requires at least 20% of the EU’s total energy needs to be met with renewables by 2020.
Meanwhile, National Kenaf and Tobacco Board launched the Encapsulated-Kenaf Carrier Oil, an anti-ageing oil co-developed with SIRIM Bhd.
Shamsul Iskandar said the kenaf industry is projected to generate RM3.5 billion in revenue globally and RM3.5 million domestically by 2025.
Kenaf is non-woody fibre plants and short-term crops that can be used to produce eco-friendly products such as composites, automotive components and building materials.
An RM25 million large-scale kenaf processing plant in Setiu, Terengganu, will commence operation in December this year with a capacity of 2,000 tonnes of kenaf fibre per month.