Palm Oil: The Next Century


Palm oil has propelled Malaysia to become one of the world's top three edible oils producer.Palm oil has propelled Malaysia to become one of the world's top three edible oils producer.Palm oil has propelled Malaysia to become one of the world’s top three edible oils producer.

When the Oil Palm was introduced to Malaysia in 1870 as an ornamental plan, there was little thought that this golden crop from Africa would play such a pivotal role in transforming the country’s agricultural and economic landscape.

Since then, palm oil has propelled Malaysia to rank as one of the world’s top three producers of edible oils, and along the way, elevated the country into an economic power. Aside from pure economic value, this commodity has enabled us to create jobs with Oil Palm estates such as those managed by Felda.

The question now, however, is – is Palm Oil sustainable? Faced with increasing challenges from those such as the anti-Palm Oil lobby by non-governmental organisations with allegations that the planting of Oil Palm destroys the nautral habitats of the orangutan as well as lays waste to natural forests, is this vegetable oil still relevant, and would it continue to be a profitable industry for the next century?


BadrulTDM Berhad chief executive officer Badrul Hisham Mahari (pic) answered with a resounding ‘yes’.

The demand for vegetable oils will continue to grow as, firstly, the world population continues increasing and secondly, the per capita income of the world continues to grow, spurring demand for Palm Oil.

Badrul said consumption of vegetable oils will also increase in tandem with the per capita income and new research on the potential usage for vegetable oils will continue to be unveiled, such as for renewable energy or biodiesels.

“Without a doubt, the cheapest of edible oils (vegetable or animal) to be commercially viable for production is Palm Oil. It is ahead by a factor of more than two to its closest rival,” he told Business Circle.

What are its challenges?

MIDF Research Analyst, Nur Nadia Kamil, meanwhile said that land available for the planting of Oil Palms is limited due to requirements of the plant. Only land with less than five degrees terrain lying within 10 degrees north or south of equator, that is not yet populated can be used for this purpose.

Badrul said the road ahead is long and fraught with challenges and agreed with Nadia that land is finite and feels that players must grab suitable land quickly before others do, sit on it and slowly develop the land.

“Otherwise, we must develop new progeny that can handle less water, less sunlight and also that can handle more than five percent terrain or develop new varieties that can produce even higher yields than what we currently see.

Badrul said the industry is also labour intensive and so it must develop technology to overcome this. Lastly, further research and development must be undertaken to discover new usages of crude Palm Oil.

Nadia meanwhile said the current challenges faced by the Palm Oil industry in Malaysia are scarcity of available land, shortage of in-field skilled workers, criticisms from non-governmental organisations regarding environmental issues and non-tariff barriers to Palm Oil use.

Leave a Comment