11/02/2009 (Daily Express, Malaysia), Kuala Lumpur - Usage of the mandatory blending of five percent palm oil with diesel (B5) will be fully implemented by 2010, according to Plantation Industries and Commodities Minister Datuk Peter Chin.

The government has approved B5 in the local transport and industrial sectors and it will be phased in to the domestic fuel market starting with government vehicles, he said.

The incentive is set to create demand for an additional 500,000 tonnes of palm oil locally which will be needed to produce palm biodiesel, Chin told Oxford Business Group.

"By increasing demand, palm oil stocks will be used in Malaysia, at a time when uncertainty in the global markets has raised doubts about how export of palm oil will fare this year," he said.

This, he added, is one of the measures that the ministry, together with agencies under its umbrella, has put into practice.

The Malaysian Palm Oil Board (MPOB) and Malaysian Palm Oil Council (MPOC) both promote palm oil and its products overseas while also providing technical support and information about palm oil products.

Chin said the ministry would continue to monitor developments of biodiesel in major markets overseas.

He also recognised the importance of promoting sustainable development and giving weight to environmental issues.

"The MPOB developed codes of practice for the oil palm industry following consultation with key players in the industry," he said.

The government is also looking at ways of reducing environmental pollution and contamination, with discussions increasingly focusing on the use of clean development mechanisms and reducing green house gases.

Chin said the codes of practice have been used to form the basis of a sustainability manual which is set to be completed by June this year.

The manual will serve as a point of reference for sustainable practices in the oil palm industry, he said.

In the current economic climate, it is in the companies' interest to consider ways of reducing costs and improving competitiveness, according to Chin.

The recent merger of Sime Darby, Golden Hope and Guthrie, and also Wilmar International and PPB Oil Palm Group are examples of how companies could work together to meet challenges in the world market, he said.

Oxford Business Group is coming out with "The Report: Malaysia 2009", the latest of its annual business guides, with comprehensive review of the country's economy.- Bernama