BusinessWorld (Philippines) 10/03/2001 - The Department of Agriculture(DA) yesterday said two Malaysian firms have committed to invest P975million to develop the country's palm oil industry.In a report submitted to the Agriculture department, Agumil Philippines,Inc. and Agusan Plantation, Inc. said a total of 13,000 hectares of landwill be developed in Mindanao for palm oil plantation from 2002 to 2004.The Philippine Coconut Authority (PCA) estimates that it will cost aboutP75,000 to develop one hectare of land into palm oil plantation.In Agusan del Sur, about 2,600 hectares will be converted to palm oilplantation. At present, both companies occupy about 3,700 hectares of landas palm oil plantation. In Cotabato, about 3,600 hectares of land will bedeveloped while another 7,000 hectares of land in Bohol province will beconverted into palm oil plantation.The Mindanao region is eyed as the most suitable area to grow palm oilbecause of its moderate temperature as well as the evenly distributedrainfall.Rolando T. Dy, executive director for Food and Agribusiness of theUniversity of Asia and the Pacific, said in a statement that thegovernment should already start the full development of this industrybecause of the expected increase in the demand in the next couple ofyears."By 2010, domestic palm oil demand would require some 70,000 to 100,000hectares. Given the gestation and senile trees, plantings must start soon.Given the slow pace of doing things here, the country will start to importpalm oil in 2010," he said.He also said the development of the palm oil industry will producecompetition with the coconut industry. But he pointed out that the exportmarket will readily absorb the available supply of coconut oil if domesticusers will prefer palm oil because of economic costs.Palm oil is the world's second source of vegetable fats after soybeans.Palm oil is usually use in the manufacturing of canned fish and meatproducts. It is also used as cooking oil and margarine.Last year, the country imported about 67,000 tons of palm oil. The localproduction was only recorded at around 46,000 tons against a total demandof 113,200 tons.By 2005, the consumption is expected to increase to 180,000 tons but basedon the existing production area allocated to palm oil the country isexpected to harvest only about 53,000 tons. In 2010, the country is seento import some 189,000 tons to meet the demand of about 290,000 tons.