Tuesday September 21, 2004 - OIL palm fronds (OPF) fibre feed has thepotential to be a RM10bil industry and can help provide additional incomeof between RM150 and RM250 per month to Felda settlers.

Koperasi Generasi Felda Bhd (KGFB) chairman Zainuddin Ismail pointed tothe huge demand for OPF fibre feed in overseas markets like Japan, SouthKorea, Taiwan and the European Community countries as well as from localcattle farmers.

Currently, the F.O.B. price of OPF fibre feed in the international marketis about US$90 to US$100 a tonne. In Malaysia, it is sold at between RM270and RM300 a tonne.

OPF fibre, the raw material, is abundant and available all year round,thus guaranteeing continuous supply at very competitive prices.

KGFB plans to set up 10 OPF fibre feed plants nationwide within the nextthree years through a joint venture with Sejati Oil Palm Feed Sdn Bhd(SOPF).

KGFB, established early this year, is a 1,000-member cooperative bodyformed by entrepreneurs and professionals from the new generation of Feldasettlers.

Zainuddin said: With the assistance of Felda group, we hope to locatethese plants in Felda plantations, which will benefit the settlers throughenhancing their income and creating new job opportunities.

The first plant, estimated to cost RM4mil, would be built in Felda Jengka,Pahang, he told reporters in Kuala Lumpur yesterday after an agreementsigning between KGFB and SOPF for the joint venture.

We need to set up 10 OPF fibre feed plants to attain a volume about 15,000tonnes a month, which will enable OPF fibre feed to be traded as acommodity on the international market, like soybean, alfalfa and corn,Zainuddin added.

He said the commercialisation of OPF fibre feed had the potential to beanother top commodity for Malaysia after crude palm oil.

We believe oil palm fronds produced by the 3.5 million ha of oil palmplantation in Malaysia, if converted to OPF fibre feed, can generate anincome of about RM10bil a year, he added.

SOPF managing director Zainal Ahmad said the joint venture would providean avenue to expedite large-scale production of OPF fibre feed inMalaysia, with SOPF providing technical know-how and Felda group theinfrastructure and supply of raw materials.

Last year, SOPF started commercialisation of OPF fibre feed through itsplant in Carey Island, Selangor. To date, 80% of its products are exportedto Japan and South Korea. The balance is sold locally.

Zainal said: We believe this joint venture will be able to reduce thecountry's import bill for feed ingredients, especially in the cattleindustry.

Imports of feed ingredients are believed to exceed RM3bil a year.