Malaysia Palm Oil Exports To Major Countries (TONES)
Source : http://www.mpoc.org.my
Different grades of oil quality are obtained from the pericarp and the
kernel, with the pericarp oil used mainly for cooking oil, and the kernel oil
used in processed foods.
For each hectare of oil palm, which is harvested year-round, the annual production averages 10 tones of fruit, which yields 3,000 kg of pericarp oil, and 750 kg of seed kernels, which yield 250 kg of high quality palm kernel oil as well as 500 kg of kernel meal. The meal is used to feed livestock. Some varieties have even higher productivities which has led to their consideration for producing the vegetable oil needed for biodiesel.
The African Oil Palm was introduced to Sumatra and the Malay area in the early 1900s; many of the largest plantations of oil palms are now in this area, with Malaysia growing over 20,000 square kilometers. Malaysia claims that in 1995 it was the world's largest producer with 51% of world production. In this area, the destruction of natural rainforest to grow oil palm plantations is an issue of major environmental concern.
West African oil palm today has become an international oil crop from its commercial plantation center in Malaysia and Indonesia.
The fruit takes six months to mature from pollination to maturity; it comprises an oily, fleshy outer layer (the pericarp), with a single seed (kernel), also rich in oil. Unlike its relative, the Coconut Palm, the oil palm does not produce offshoots; propagation is by sowing the seeds.
Mature trees are single-stemmed, and grow to 20 m tall. The leaves are pinnate, and reach between 3-5 m long. A young tree produces about 30 leaves a year. Established trees over 10 years produce about 20 leaves a year.
EFB - Natural Solid Wastes : EFB (Empty Fruit Bunch) is
solid waste generated in oil palm planted throughout Malaysia over 4 million
hectares land, which remains unutilized commercially.
POIC Palm Oil Industrial Cluster : http://www.poic.com.my/
POIC Sabah Sdn Bhd is a wholly owned company of the State Government of Sabah. It has a 15-year plan to develop a 7,500 acres of land in Lahad Datu into a cluster of palm oil-related factories . POIC Lahad Datu is Malaysia's first dedicated large-scale palm oil downstream industrial cluster. The first phase of the POIC encompassing over 500 acres is in late stage of completion. Inquiries to email@example.com Tel : 088-272261
The oil palm (Elaeis guineensis) produces palm oil and palm kernel oil. It is
a native of tropical Africa that is extensively planted commercially in many
other tropical countries.
Palm oil is produced from the pulp of the fruit. The oil is light yellow to red in color and is rich in carotenes (the precursor of vitamin A) and Vitamin E.
Palm kernel oil is produced from the seed. The oil is almost colorless and is used in making margarine, ice-cream and in the baking industry.
Oil palm is Sabah's largest agricultural crop with over 1 million ha planted, almost all In the east coast. The Tawau and Sandakan Residencies have about 436,000 ha and 592,000 ha respectively.
Malaysia produces about 50% of the world's palm oil. The value of palm oil exports In 2003 was RM 26.15 billion.
There is roughly 1 oil palm mill for every 10,000 ha of oil palm planted.
Pure palm oil is the best vegetable at to use for frying food.
Oil palm trees are cultivated for the production of palm oil.
The oil palms (Elaeis) comprise two species of the Arecaceae palm family.
1) African Oil Palm Elaeis guineensis is originated from west Africa between Angola and Gambia;
2) American Oil Palm Elaeis oleifera is native to tropical Central and South America.
Old Oil Palm Trees
What is oil palm used for, where is oil palm planted & produced, where is the
West African have traditionally used Oil palm (Elaeis guineensis Jacq.) to make foodstuffs, medicines, woven material and wine. Now the palm is planted in large-scale plantations throughout the tropics countries because it is used in commercial products like cooking oil, soap, cosmetics and margarine.
Oil from oil palm plant is edible and has now surpassed soybean oil as the most produced vegetable oil in the world.
Palm Oil also processed into soaps, washing powders and skin care products, medicines and the future biofuel.
The palm fruit provided two source of oil :
1) Palm oil (from palm fruit) - This Crude Palm Oil (CPO) is the primary product derived from the red seeds of the oil palm
2) Palm Kernel oil (from the fruit seeds) - Palm Kernel Oil (PKO) from the fruit’s nut/seed is considered to be a secondary product and the Palm Kernel Meal (PKM) is used for animal feed mainly.
Palm oil is high in saturated fats and thus semi-solid at room temperature.
Oil palm plantations have primarily expanded in the top two palm oil producing countries : Malaysia and Indonesia.
Malaysia produced almost 50% of world palm oil production, while Indonesia produced 30%.
World demand for palm oil has been increasing dramatically. Most of this palm oil was consumed in Asia.
Sabah Oil Palm Plantations
The palm oil plantations covering more than 700,000 hectares in East Sabah where suitable agricultural land are available . Sabah's agriculture land has the highest yield of oil palm fresh fruit bunch per hectare.
Sabah's Oil Palm Sector is mainly confined to the primary processing of oil palm. Presently, there are 58 palm oil mills in Sabah producing crude palm oil , palm kernel oil and palm kernel cake. Only a small number of refineries producing higher value added oil palm products.
The Oil Palm Sector is an important sector the economy. In terms of export earning, oil palm contributes more than 30 per cent of the total income from exports. In 1998, exports of palm oil reached a record of RM5 billion. Sabah is the largest producer of crude palm oil in Malaysia contributing 25% of the total production of crude palm oil in Malaysia.
An oil palm fruit bunch contains several hundred fruits which do not ripen all at the same time. The period between the first ripen fruit and the time at which all fruits of a bunch are ripen is 18 to 20days.
The manager of an oil palm plantation can control ripeness in two ways:
1) ensure that the frequency of harvesting in any one area is kept sufficiently high to eliminate over-ripening and the resulting high FFA
2) by setting a standard number of detached ripe fruit per bunch below which bunches are not harvested, this ensure that under-ripe bunches, which would reduce oil yield, are not cut.
Harvesting is carried out using either a chisel or a sickle, depending on the height of the palms. The FFB is harvested by cutting through the bunch stalk and carried manually to the roadside for transportation to palm oil mill.
Suggest fertilizer schedule considered satisfactory for oil palm as
g/per palm annually
Third year and onwards
Mg application if deficiency symptoms are noticed. Fertilizers are preferably applied in two equal split doses (May and September), within 2 m diameter around the palm.
Supply of sufficient quantities of green leaf or compost is advantageous, especially where the soil is poor in organic matter.
More about fertilizer : Comparison between organic fertilizer and chemical fertilizer : Detail...
Two methods of composting empty fruit bunches (EFB) of oil palm :
Ingredients used for composting in The OPEN and CLOSED methods
|Open Method||Closed Method|
|1)Mixtures of EFB, 2)fermentation liquid waste and 3)chicken manure in open method||1)EFB, 2)palm oil mill effluent and 3)chicken manure in closed method|
|Natural aeration was carried out in the open system||Vontrolled aeration in the closed system.|
|Windrow piles of 1mt for the open system||Windrow piles of 80 mt for the closed system|
|For the open system, the EFB were cut into pieces.||For the closed system, the EFB were reduced in size by a hammer mill.|
|The composting process progressed at a reasonable rate, being faster for the open than the closed system.||The distribution of moisture during composting was uneven in the closed system. This resulted in uneven biological activity.|
|A C/N ratio of 16 was achieved in 50 days in open method||A C/N ratio of 16 was achieved in 85 days in closed method|
Empty fruit bunch from an palm oil mill in Malaysia
Palm oil mill effluent (POME).
POME is the wastewater from palm oil industry. It is a colloidal suspension which is 95-96% water, 0.6-0.7% oil and 4-5% total solids including 2-4% suspended solids originating in the mixing of sterilizer condensate, separator sludge and hydrocyclone wastewater. POME contains 4,000 mg dm-3 of oil and grease, which is relatively high compared to the limit of only 50 mg dm-3 set by the Malaysian Department of Environment
PALM KERNEL CAKE (PKC)
Palm kernel cake (PKC) is a by-product of oil extraction from palm kernel. This by-product is ever increasing due to the increasing growth of the oil palm industry in Asia and Africa.
Malaysia in 2001 alone, produced 1.4 million tones of palm kernel oil together with 1.6 million tones of Palm kernel cake (PKC) as its by product from 3 million tones of palm kernel
Currently, most of the Palm kernel cake (PKC) produced in Malaysia is exported at a low price to Europe for use as cattle feed concentrates in dairy cows.
Palm kernel cake (PKC) is an established feed ingredient for ruminants, supplying valuable dietary sources of protein, energy and fiber. Palm kernel cake (PKC) has also been successfully tested in poultry feeds at low levels of incorporation. The low cost and availability of Palm kernel cake (PKC) in many tropical countries where aquaculture is practiced have recently generated much interest in its potential use in fish diets.
Malaysian Palm Oil Association
Malaysian Palm Oil Board
Ministry of Industrial Development
Ministry of International Trade & Industry
Malaysian Industrial Development Authority
Malaysian Palm Oil Promotional
Council Malaysia’s oil palm industry faced with two problems : Photo above : Worker harvesting palm oil fruits in a Malaysian plantation A global growing demand for edible oils resulted in an increase in the oil
crops cultivation of soybean and oil palm. World production of palm oil World Production of Palm Oil ('000 tonnes)
Others Oil Palm Trees FFB Fresh Fruit Bunch - Oil palms are grown for their clusters of fruit,
which can weigh 40-50 kg. Upon harvest, the drupe, pericarp and seeds are used
for production of soap and edible vegetable oil. References
1) Lack of manpower resources
2) Incurable oil palm disease - Ganoderma Basal Stem Rot (BSR)
90% of the manual workers in Sabah's oil palm plantations are Indonesian workers employed to do harvesting, weeding and other plantation maintenance works. The work is tough, long hours and lowly-paid.
The Ganoderma Basal Stem Rot (BSR) disease is caused by bracket fungus Ganoderma. It is lethal and incurable for more than 50 years now. During replanting, if the old oil palm trunks are left to rot on the ground, various fruiting bodies of Ganoderma may be produced and thrive. Ganoderma Basal Stem Rot (BSR) is fast becoming a major threat to oil palm cultivation and palm oil production in Malaysia.
It is difficult to control the spread of basal stem rot fungus disease. In oil palms, the main causal agent of this disease is the fungus Ganoderma species. This major agricultural problem particularly found in oil palm and coconut plantations. It can cause half of the plant mortality in palm population in seriously affected areas within 10 years of attack.
Ganoderma species attacks start from the palm roots and gradually spread to the bole of the stem, causing dry rot, thus preventing nutrients from being absorbed by the soft tissues. The palm will gradually lose its ability to produce fruits and eventually collapse. One feature of Ganderma spp. is the persistence of the pathogens in infected woody tissues and soil borne debris allowing the disease to reappear in oil palm estates which are doing their second or even third replanting.
It is critical to conserve the present oil palm land by controlling the spread of the disease.
BSR disease field observations carried out in Indonesia on a series of planting materials shown that differences in susceptibility to the disease have been detected within Elaeis guineensis and Elaeis oleifera. Within Elaeis guineensis, material of Deli origin is highly susceptible compared to material of African origin.
FFB - Fresh Fruit Bunch
Oil Palm fruits are harvested for their oil-rich mesocarp (pulp). Like coconuts, the seeds are rich in saturated fatty palmitic acid.
Palmitic acid has all single bonds between the carbon atoms and is similar to animal fat (stearic acid), except it has 16 rather than 18 carbons.
Palm oils are used for cooking oil, soaps, candles, margarines and candy. Health-conscious people who are concerned about atherosclerosis tend to stay away from foods rich in saturated fats.
Soybean : In the last decade, the four main soybean growing countries recorded a 92% increase production and 66% increase planting area.
The four main soybean growing countries are :
Oil Palm : Production of palm oil has also seen significant leaps in production and planting areas. World production had almost doubled from 1990 to 2001, with Malaysia and Indonesia contributing to most of the increased production.
The rapid expansion of both crops had resulted in the conversion of High Conservation Value Forests1 (HCVFs) in South America, including parts of the Amazon and in South-East Asia.
As world production of palm oil and soyoil is expected to continue to increase at the current pace, there is a growing concern that this expansion would result in conversion of a large proportion of the remaining HCVFs in the tropics.
The supply chain of the palm oil industry in Malaysia.
The Oil Palm Industry in Malaysia is grouped into clusters covering :
1) Upstream producers,
2) Downstream producers,
3) Exporters and importers,
5) Government agencies
3.38 million hectares of oil palm planted in Malaysia in 2000 as following :
1) 60% are private ownership, particularly by plantation companies,
2) 30.5% are Government land schemes
3) 9.5% are individual smallholders.
FELDA : The largest upstream player is the Federal Land Development Authority (Felda) which was established in 1956 with the socio-economic mandate of developing Malaysia agricultural land for the rural poor and landless.
Felda accounts for 17.7% of the total planted area and 20.6% of the palm oil produced in Malaysia in 2001.
Plantation companies vary in size from a few hundred hectares to more than 100,000 hectares.
The 4 largest companies in Malaysia in terms of planted area are :
1) Kumpulan Guthrie Berhad
2) Golden Hope Plantations Berhad
3) IOI Corporation Berhad
4) Sime Darby Berhad
Colonial Era - Many present day plantation companies have their beginnings in the colonial era at the turn of the 20th century when English and other European entrepreneurs transformed forest land into tea and coffee and rubber estates.
Amongst the ‘old’ colonial companies are
1) Kumpulan Guthrie Berhad,
2) Golden Hope Plantations Berhad,
3) Sime Darby Berhad,
4) Kuala Lumpur Kepong Berhad and
5) United Plantations Berhad.
Since the 1970s, several ‘home grown’ companies have entered the industry, the most notable example being IOI Corporation Berhad which started form zero base in 1983 to become one of the largest plantation companies today.
The equity of plantation companies in the country is largely under Malaysian ownership, the largest investors being the national equity corporation, Permodalan Nasional Berhad (PNB) and the Employees Provident Fund (EPF).
PNB has substantial holdings in seven major plantation companies while EPF which provide retirement benefits for its members has made substantial investments in more than 14 plantation companies listed on the Kuala Lumpur Stock Exchange.
Only a few companies have substantial controlling foreign shareholding, examples being United Plantations Berhad and Pamol Plantatins Sdn Bhd (recently announced to dispose all its plantations in the Malaysia)
Besides production of crude palm oil, many companies are also involved in downstream production activities along the supply chain, such as palm oil refining, production of edible oil and palm-based products and manufacture of basic oleo chemicals. The larger companies have also expanded their downstream operations offshore by establishing palm oil refineries in consuming countries such as India, Bangladesh, Pakistan, China and Egypt. Recently, two plantation companies established their presence in edible oils in Europe; Golden Hope Plantations Berhad acquired Unlilever’s Unimills BV which is second largest processor of edible oils in Europe while IOI Corporation Berhad took control of Loders Croklaan BV, a global producer and supplier of specialty oils and fats. Moving in the opposite direction, several companies have ventured into establishment of oil palm plantations off-shore, particularly in Indonesia to take advantage of the availability of land and workers and lower cost of production. The biggest player in this context is Kumpulan Guthrie Berhad which acquired about 200,000 hectares in Minamas Plantations in 2001.
The diverse interests of upstream and downstream producers of palm oil and palm products are represented by a number of industry organizations. The 3 principal organizations are :
1) Malaysian Palm Oil Association (MPOA)
2) Malaysian Palm Oil Board (MPOB)
3) Malaysian Palm Oil Promotional Council (MPOPC)
MPOA - the plantation owners’ association with 100+ members of more than 1.4 million hectares oil palm trees. This amounts to 70% of the area under private ownership. MPOA’s mission is to ensure the long term profitability and growth of the Malaysian palm oil industry.
MPOB - responsible for research and development and for regulatory and licensing functions of palm oil industry.
MPOPC - to promote Malaysian palm oil. Its activities focused on marketing communications, technical marketing and market promotion locally and in several edible oil consuming countries.
Increasing pressures from stakeholders on environmental issues resulted in forming of two national committees to address the concerns raised.
1) MPOA has set up the Working Committee on Environment - The MPOA committee has a broader scope of work including the development, and promotion of best management practices.
2) MPOPC has established the Palm Oil Task force on the Environment - MPOPC’s Task Force to focus on production of communication materials to project the positive attributes of the industry with regard to the environment and sustainable development.
ASEAN - Association of South East Asian Nations
AVOC - ASEAN Vegetable Oils Club
BMP - Best Management Practice
BOD - Biochemical Oxygen Demand
COD - Chemical Oxygen Demand
CPKO - Crude Palm Kernel Oil
CPO - Crude Palm Oil
DOE - Department of Environment Malaysia
ECD - Environment Conservation Department, Sabah
EFB - Empty Fruit Bunches
EIA - Environmental Impact Assessment
EMPA - East Malaysia Planters Association
EMS - Environment Management System
ENGO - Environmental Non-Governmental Organization
EPF - Employees Provident Fund
EQA - Environment Quality Act
EQC - Environment Quality Council
ESOS - Employees/Executive Share Option Scheme
FELCRA - Federal Land Consolidation & Rehabilitation Authority
FELDA - Federal Land Development Authority
FFB - Fresh fruit bunches
FOSFA - Federation of Oils, Seeds and Fats Associations
GHPB - Golden Hope Plantations Berhad
IASC - International Association of Seed Crushers
IOI - IOI Corporation Berhad
IPM - Integrated Pest Management
ISP - Incorporated Society of Planters
JKAS - Jabatan Konservasi Alam Sekitar
KER - Kernel extraction rate
KGB - Kumpulan Guthrie Berhad
KLK - Kuala Lumpur Kepong Berhad
KLSE - Kuala Lumpur Stock Exchange
LSE - London Stock Exchange
MEOA - Malaysian Estate Owners Association
MEOMA - Malayan Edible Oil Manufacturers’ Association
MNS - Malaysian Nature Society
MOMG - Malaysian Oliochemicals Manufacturers Group
MOPGC - Malaysian Oil Palm Growers Council
MoU - Memorandum of Understanding
MAPA - Malaysian Agricultural Producers’ Association
MITI - Ministry of International Trade and Industry
MOF - Ministry of Finance
MOSTE - Ministry of Science, Technology and Environment
MPI - Ministry of Primary Industries
MPOA - Malaysian Palm Oil Association
MPOB - Malaysian Palm Oil Board
MPOPC - Malaysian Palm Oil Promotion Council
NACRA - National Annual Corporate Reports Award
NASH - National Association of Smallholders
NIOP - National Institute of Oil Seeds Products
NREB - Natural Resources and Environment Board
OER - Oil Extraction Rate
PfW - Partners for Wetlands
PK - Palm Kernel
PNB - Permodalan Nasional Berhad (National Equity Corporation)
POMA - Palm Oil Millers Association
POME - Palm Oil Mill Effluent
POPF - Palm Oil Promotional Fund
PORAM - Palm Oil Refiners Association of Malaysia
POTFE - Palm Oil Task Force on Environment
PPBOP - PPB Oil Palms Berhad
RGA - Rubber Growers’ Association
RISDA - Rubber Industry Smallholders Development Authority
SALCRA - Sarawak Land Rehabilitation and Consolidation Authority
SLDB - Sabah Land Development Board
TQEM - Total Quality and Environment Management
UNEP - United Nations Environment Programme
UPAM - United Planting Association of Malaysia
UPB - United Plantations Berhad
UPM - Universiti Putra Malaysia
WWFM - World Wide Fund for Nature Malaysia
In 2001, the world’s production of palm oil was 23.18 million tones or 19.8% of the total production of 17 oils and fats, making it the second most important oil after soyoil.
Palm oil has achieved impressive growth in production and exports in the last few decades; production had doubled from 1990 to 2001 (Table 3).
In terms of exports, palm oil is the most widely traded oil, accounting for 45.6% of the world’s exports of 17 oils and fats in 2001.
In 2001 Malaysia was still the largest producer of palm oil, contributing about 11.80 million tones or 50.9% of total production, while Indonesia produced about 7.5 million tones or 32.3%. Malaysia is also the world’s largest exporter of palm oil, accounting for about 61.1%
Country of Origin
Papua New Guinea
& Collection of
Fresh Fruit Bunches (FFB)
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Malaysia’s oil palm industry faced with two problems :
Photo above : Worker harvesting palm oil fruits in a Malaysian plantation
A global growing demand for edible oils resulted in an increase in the oil
crops cultivation of soybean and oil palm.
World production of palm oil
World Production of Palm Oil ('000 tonnes)
Oil Palm Trees
FFB Fresh Fruit Bunch - Oil palms are grown for their clusters of fruit,
which can weigh 40-50 kg. Upon harvest, the drupe, pericarp and seeds are used
for production of soap and edible vegetable oil.