26 September 2001(Business Times) - MALAYSIA’S commodity sector is notexpected to be adversely hit by low demands and poor sales unlike someother sectors if the US decides to attack Afghanistan, Primary IndustriesMinister Datuk Seri Dr Lim Keng Yaik said.He said the sector mainly comprising of palm oil, rubber, timber and otherraw materials will not be as hard hit as the electrical and electronics (Eand E) sector.“It is still too early to say but some pros and cons will develop onMalaysia’s commodities in which higher or lower demand may be seen.“But I expect it won’t be substantial,” Dr Lim told reporters in KualaLumpur yesterday after officiating a conference on electronic commerce onstrategies for penetrating markets organised by the Malaysian Investors’Association.Dr Lim was asked to comment on the effect of US retaliation towardsterrorist attacks in New York and Washington on September 11 on the localcommodities and whether the commodity will stand out to be the saviour inthe event of a global recession.Malaysia was affected by the regional economic downturn of 1997 but wascushioned by its wide spectrum of economic activities, notably sales ofits broad range of commodities namely palm oil, timber and rubber.Similarly, prices of the world’s commodities such as crude oil, gold, tin,palm oil and rubber increased during the Gulf War in 1990.Dr Lim said developed countries are so tied up in building up theirhardware to go full swing into war, which may result in their economiesgoing into a recession.“The possible war may increase the prospects of a global recession but atthe same time more war machinery need to be built, which in turn willtrigger greater demands from other sectors,” he said, citing the KoreanWar in the 1950s as an example in which prices of natural rubberincreased.“The US would need more rubber to build their war machines but it is stillto premature to speculate,” he said.Dr Lim said it is still too early to say what effects the possible warwill have overall but increased purchases of Malaysia’s palm oil byPakistan of late has been a positive development.“Prices of palm oil increased by as much as RM50 a tonne and reports ofpalm oil shipments to Pakistan being disrupted are not true,” he said.He said India and China, Malaysia’s first and second biggest palm oilbuyers respectively, may also want to start stock-piling palm oil andtimber in view of the possibility of supply disruptions and the USmilitary campaigning against terrorists.He also dismissed reports by a foreign wire agency there will be ashortage in rubber supply if war breaks out.“The Tripartite Rubber Cooperation consisting of the world’s top threerubber producers formed early this month will regulate supply and demand,”he said.Thailand, Indonesia and Malaysia account 85 per cent of the world’s rubberproduction with a combined output of some 4.4 million tonnes last year.Malaysia is the world’s largest producer of palm oil, producing some 11million tonnes last year of which nine million tonnes were exported