2/1/06 (Business Times)  -  THE commodities sector continued to shine last year, with export earnings expected to hit RM65 billion, exceeding the RM62.7 billion recorded in 2004.


Malaysia’s planted commodities include palm oil, timber, rubber, cocoa, tobacco and pepper. The country sold RM55.2 billion worth of plantation-based commodity products in 2003.

Already, from January to September 2005, overall plantation-based commodity exports grew by about 4 per cent,” Plantation Industries and Commodities Minister Datuk Peter Chin Fah Kui said.

“If all our plantation-based commodities continue with this nine-month growth trend, we will definitely do better than in 2004,” he told Business Times in a telephone interview recently.

The Statistics Department’s January-September data showed that Malaysia exported RM48.64 billion worth of palm oil, timber, rubber, cocoa, pepper and tobacco products — 4.24 per cent more than the RM46.66 billion worth in the previous corresponding period.

The commodities sector is Malaysia’s second largest contributor to export earnings after manufacturing. Petroleum came in third.

Chin said exports of cocoa, rubber, pepper and timber grew in the first nine months of 2005.

The export of cocoa products jumped the highest, by 21 per cent to RM1.45 billion. Palm oil exports slipped 0.64 per cent to RM21.45 billion, while tobacco products fell 0.42 per cent to RM626.92 million.

“Although palm oil is our No.1 revenue contributor, cocoa exports grew the fastest in the first nine months,” the minister said.

He said Malaysia’s cocoa butter exports, the main ingredient in making chocolate, jumped by almost 50 per cent and that catapulted overall cocoa product exports by 21 per cent.

Exporters of rubber products have good reason to smile as natural rubber (NR), such as SMR20, has been trading at a high of RM6.30 a kg. NR prices used to be as low as RM1.91 a kg back in 2001.

“As world crude oil continues to trade at high prices, so will natural rubber because it is a substitute for synthetic rubber in making tyres.

“So, Malaysia as a major producer of natural rubber has benefited from this high price trend. In the first nine months of 2005, rubber exports expanded by 8 per cent to RM9.10 billion,” Chin said.

In explaining the lower palm oil export revenue compared to 2004, the minister said “2004 was a spectacular year for palm oil, when the average crude palm oil price was about RM1,600 and export was RM30.41 billion”.

“(In 2005) the 11-month average CPO price was about RM1,400 and therefore exports will be slightly less than last year’s,” he said.