June 14 2004 - MALAYSIA’S palm oil industry plans to deploy marketintelligence officers at all of the country’s embassies worldwide togather information on world edible oils and fats that can be used to trackkey market developments and plan future strategies.

Malaysian Palm Oil Association (MPOA) chairman, Sabri Ahmad, said the datagathered will be essential for the industry, enabling it to gain earlywarnings about competitors’ moves and plan ways to counter them.

Apart from palm oil, the market intelligence officers would also trackinformation on 16 other edible oils and fats.

A proposal will be made to the Government soon. As the world’s largestproducer of palm oil, we should have our very own market intelligence...we should not rely on foreign-based information.

Even though Malaysia is the world’s largest producer of palm oil,ironically we still rely on information generated thousands of kilometresaway, Sabri, who is also Golden Hope Plantations Bhd group chiefexecutive, told Business Times.

Sabri said the plan is important as Malaysia needs to safeguard its palmoil industry which generated RM27 billion in export earnings last year.

Malaysia is the world’s largest producer of palm oil. Of the 13.3 milliontonnes produced last year, 12.2 million tonnes were exported to about 140countries.

Currently, most of the market information obtained by the industry arederived from foreign think-tanks the Oil World magazine, foreign-basedcompanies, traders, cargo surveyors, the Chicago Board of Trade andothers.

The commodity market is very volatile and subject to violent pricefluctuations. Those who can get intelligence first are the ones who havethe advantage as they would be able to sell their palm oil before themarket collapses, Sabri said.

In August 2003, former Kumpulan Guthrie Bhd group chief executive Tan SriAbdul Khalid Ibrahim first proposed the setting up of such an intelligenceunit to reduce dependence on information generated elsewhere.

To be called the Business and Economic Intelligence Centre for the PalmOil Industry, the facility would build up its own crop production andprice database with a view to offering members of the MPOA analyses andupdates on demand and supply situations.

The centre will manage four core aspects industry statistics, nationaland international statistics, market intelligence and geographical andgeo-political issues.

The unit’s operations will be funded through a RM5 million annual cessprogramme in which MPOA members participate. The association represents 70per cent of Malaysia’s plantation sector with 105 members with a combinedlandbank of 1.7 million ha.

The centre will be managed by the Malaysian Institute of EconomicResearch, providing intelligence thro- ugh a comprehensive set ofdatabases related to the palm oil industry and research that providesanalyses of emerging trends.

However, it is not known whether the unit is already in operation.

As an example, the US Department of Agriculture has officers stationed atall its embassies to monitor the indigenous crops of every nation such aspalm oil for Malaysia and Indonesia and soyabean for Brazil and Argentina.

The department also monitors crop data for every plantation company inMalaysia such as Sime Darby Bhd, Golden Hope and others, he said.

Sabri said Malaysia could do the same as players here need informationfast to enable it to prepare its next line of action such as weatherpatterns (floods, monsoon, drought) in India, Indonesia or Brazil.

The officers can also report to us the latest situation in India, forexample, whose government policies change all the time such as taxstructure, import quota and others, he said.