MARKET DEVELOPMENT
Malaysia Can Reduce CPO Stockpile By Diversifying Into Downstream Activities
Malaysia Can Reduce CPO Stockpile By Diversifying Into Downstream Activities
27/04/2016 (Bernama) - Malaysia's palm oil stockpile can be reduced if industry players diversify further into downstream production which can provide a more lucrative revenue of about 50 per cent higher than the output from the upstream sector, says the Minister of Plantation Industries and Commodities Datuk Seri Amar Douglas Uggah Embas.
He said a more robust downstream integration would help the sector weather through the ongoing volatility in palm oil prices that would otherwise cause major setbacks in the plantation industry.
Efforts are already underway but much needs to be done to intensify the diversification and strengthen resilience by departing from a deep reliance on the commodity market.
"This shift in focus towards the downstream sector, along with various public and private initiatives, should be built upon people, planet and profits as the underlying foundation," he said in the 2015 National Transformation Programme Annual Report unveiled by Prime Minister Datuk Seri Najib Tun Razak tonight.
On increasing smallholders' income in the palm oil sector, Uggah said efforts under the Entry Point Projects was now being extended to include non-palm oil revenue via crop integration.
The crop integration included more than eight types of crops such as pepper and banana, whereas for livestock integration, cattle and goats are covered.
"Although both methods of integration are not new concepts, they are being introduced as a palm oil sector key performance indicator for the first time.
"The underlying aim is to provide smallholders with early income in the first three years of replanting/new planting while they wait for their palm oil plants to fully mature," it added.
He said a more robust downstream integration would help the sector weather through the ongoing volatility in palm oil prices that would otherwise cause major setbacks in the plantation industry.
Efforts are already underway but much needs to be done to intensify the diversification and strengthen resilience by departing from a deep reliance on the commodity market.
"This shift in focus towards the downstream sector, along with various public and private initiatives, should be built upon people, planet and profits as the underlying foundation," he said in the 2015 National Transformation Programme Annual Report unveiled by Prime Minister Datuk Seri Najib Tun Razak tonight.
On increasing smallholders' income in the palm oil sector, Uggah said efforts under the Entry Point Projects was now being extended to include non-palm oil revenue via crop integration.
The crop integration included more than eight types of crops such as pepper and banana, whereas for livestock integration, cattle and goats are covered.
"Although both methods of integration are not new concepts, they are being introduced as a palm oil sector key performance indicator for the first time.
"The underlying aim is to provide smallholders with early income in the first three years of replanting/new planting while they wait for their palm oil plants to fully mature," it added.