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12 November 2009

Malaysia’s biodiesel exports defy NGO attacks

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Malaysia’s palm biodiesel exports to the European Union (EU) and the United States have continued to rise this year despite the ongoing attacks on palm oil greenhouse gas (GHG) emission by non-governmental organisations.

The StarBiz, a local business daily, was quoting Malaysian Palm Oil Board (MPOB) director-general Dr Mohd Basri Wahid as saying at the final day of MPOB’s International Palm Oil Congress 2009 (PIPOC 2009) yesterday.

As at end-August, some 167,846 tonnes of local palm biodiesel had been exported compared with a total of 182,108 tonnes exported in the whole of 2008.

“I expect the palm biodiesel export for 2009 will match last year’s figure,” Basri said.

However, production volume so far this year was under 10% of the total installed capacity of the local biodiesel plants in operation, he said.

Malaysia currently produces almost two milllion tonnes of palm biodiesel per year.

“Despite the approved 91 biodiesel licences, the number of plants built and in operation is still very low given the current high feedstock (palm oil) prices,” Basri said.

Basri said only seven biodiesel plants were in operation. “Eleven new plants are under construction while 52 plants are still under planning,” he added.

He expects palm biodiesel demand to remain slow going forward given the strict EU’s legislation on GHG emission and the land use issue in the United States.

Furthermore, weak demand for the B5 fuel programme in the domestic market is not helping the progress of palm biodiesel in the country, leaving producers with no margin to sustain production.

“The Plantation Industries and Commodities Ministry will soon be submitting a paper to the Cabinet on proposals to deal with the palm biodiesel issues and possibly introduce B3 fuel,” said Basri.

Meanwhile, The Roundtable on Sustainable Palm Oil (RSPO) secretary-general Dr Vengeta Rao said the RSPO principles and criteria (P&C) for independent smallholders were expected to be completed by the first half of 2010.

RSPO hoped to come out with the generic P&C for independent smallholders by February and this would lead to more smallholders working towards getting the RSPO certification and start producing more certified sustainable palm oil, he said.

At the same time, the RSPO P&C for local smallholders under the Government schemes was still under development while the RSPO P&C for Indonesian smallholders under schemes was now completed, he added.

He also said RSPO expected its membership to increase to 400 by year-end from 389 currently.


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