PUTRAJAYA, Aug 25 (Bernama) -- Malaysia on Monday called for bettercooperation with Indonesia on palm oil for their mutual benefit in theindustry as both are the largest producers of palm oil in the world.

In making the call, Primary Industries Minister Datuk Seri Dr Lim KengYaik said: "We should cooperate and not undercut each other to compete forexisting markets.

"Both should be looking for new markets and introducing new applicationsof palm oil through research and development," he said at the openingceremony of the five-day International Palm Oil Congress (PIPOC) 2003,here today.

The biennial congress, on the theme "Palm Oil: The PowerHouse for theGlobal Oils and Fats Economy," is being organised by the Malaysian PalmOil Board (MPOB). About 1,500 delegates from 45 countries areparticipating in this largest oil conference.

"Both should work together to promote and defend palm oil vis-a-viscompetition from other oils and fats," said Dr Lim, referring to thecampaign against palm oil which has now shifted from being nutritionalbased to one on environmental grounds.

Besides working together to defend palm oil, both countries should work toexploit issues favourable to palm oil like the adverse effects of transfatty acids to the advantage of palm oil, he said.

Trans fatty acids which are obtained when oil and fats hydrogenated arenow recognised for increasing risk of cardiovascular disease.

Dr Lim also said: "When prices are trending downwards, both Malaysia andIndonesia should increase the use of palm oil as a fuel to reduce globalexcess supply of the commodity.

"Let us share our technologies and legislative experience to produce ahealthy market for palm oil and a healthy environment," he added.

Malaysia, he said was seriously considering introducing legislation tomandate the blending of diesel with palm oil or palm methyl ester.

This would help reduce pollution problem in the country as well as reducestock of palm oil and help keep prices of palm oil at an acceptablelevels.

Indeed he said that there was a potential for palm oil to become the fifthfuel or energy source for the country.

Palm oil can be used without any modification as a fuel and can also beblended with diesel and used in diesel engines, he said.

He added that palm oil could also be converted into methyl ester known asbiodiesel and used directly in diesel engines without the need for anyblending.

To date, he said MPOB and Malaysian-owned oil company, Petronas, have apatented process on the production of palm biodiesel and have carried outextensive pilot plant trials on its production and use in diesel engines.

-- BERNAMA