22/2/06 (The Star)  -  KUALA LUMPUR: The outlook for the palm oil sector this year is difficult to predict partly due to demand for biodiesel, which may affect the price of crude palm oil (CPO), said Malaysian Palm Oil Association (MPOA) chief executive Azizi Meor Ngah.

“The demand for biodiesel is not just from here but other countries as well. If you factor that in, chances are the price of palm oil may go up.

“There are forecasts that it goes up to RM1,600 (per tonne). Of course that would be sensible but I don't think so, as expressed by many planters, we like to see the price move beyond that because it can make palm oil less competitive as an input for other products,” he said.

He also said Malaysian palm oil sector assets were worth RM110bil. In 2004, the sector contributed RM30bil to the country's foreign earnings, but this dropped to RM28.9bil last year.

He was speaking to reporters after signing two memoranda of understanding (MoU) with WWF-Malaysia yesterday. WWF-Malaysia was represented by its national programme director Dr Dionysius S. K. Sharma.

The MoUs are for the development of better management practices for the Malaysian palm oil industry to safeguard high conservation value forests (HCVFs) in this country.

These MoUs will facilitate a process to develop a toolkit to identify high conservation values for oil palm plantations in Malaysia, based on some principles outlined at the Roundtable on Sustainable Palm Oil (RPSO) principles and criteria.

“WWF aims to ensure that HCVFs and habitats of key species in Malaysia are no longer threatened by the expansion of oil palm plantations. 

“Therefore, WWF supports the implementation of RSPO principles and criteria because they are crucial to set benchmarks for companies that aim to produce and use palm oil in a responsible manner,” said Dionysius.