Tuesday, June 24 2003 - MALAYSIA, which imports RM2.9 billion a year ofpulp and paper, has the potential to become a net exporter by 2008.

Primary Industries Minister Datuk Seri Dr Lim Keng Yaik said yesterdaythat the export goal is within reach as the country is blessed withsufficient oil palm biomass to support a pulp and paper manufacturingindustry.

He said local players could set up 50 to 100 small, low-capacity mills toutilise the large supply of the oil palm biomass waste.

Malaysia produces 30 million tonnes of empty fruit bunches (EFBs) a year.Assuming 15 million tonnes of EFBs are available, Malaysia can producethree million tonnes of pulp a year.

And with the current pulp price of US$250 a tonne (US$1 = RM3.80),Malaysia can produce pulp worth US$750 million a year which can then beexported, he told reporters in Kuala Lumpur after a dialogue with palm oilmillers on pulp manufacturing from oil palm EFBs.

Pulp, the raw material to make paper, is usually sourced from trees in theforests. It was only 10 years ago that researchers discovered that wastefrom oil palm trees, such as EFBs, trunks, branches and fronds, could beturned into pulp.

The demand for pulp and paper is enormous. China alone needs between sixand seven million tonnes of pulp a year, and its paper industry isdesperate for pulp.

The republic has limited supply, such as padi, corn and bamboo stalks, DrLim said.

He added that the world consumption of pulp and paper exceeded 318 milliontonnes in 2001, a 33.6 per cent increase from 238 million tonnes in 1990.

The United Nations Food and Agriculture Organisation predicts thatworlwide demand for paper and paperboard will increase 3.1 per centannually to 2010.

At this rate, demand will increase to 440 million tonnes in 2010. Theprojected increase of 188 million tonnes per year is equivalent to theoutput of 900 new paper machines.

Dr Lim said the Asia-Pacific region was the fastest-growing consumer ofpaper and paper products. By 2013, it is expected to account for 50 percent of total global consumption.

The region produced 101 million tonnes of paper products, or 31.7 per centof the world total, in 2001 as against 25.1 per cent of the world total in1990. Nevertheless, the region remains a net importer of pulp and paper.

Dr Lim said minimal investment is needed for the venture since a pulp millcan be opened on land near to any of Malaysia’s 370 palm oil millers thatare locally owned by big plantation companies.

By using oil palm waste to produce pulp, it’s not like the conventinal wayof producing paper where you first need to open up new land to planttrees, fell and then chip them.