KUALA LUMPUR, Oct 16 (Bernama) -- Entrepreneurs in the oil palm industryshould explore the exciting potential for oil palm-based animal feed, saidMohd Yunus Ismail, feedmill co-ordinator at the Malaysian AgricultureResearch and Development Institute (MARDI).

He said currently the demand for the oil palm-based animal feed in thelocal and overseas markets exceeded supply.

"Therefore, the market is wide open for anyone interested to get moreincome through animal feed production," he told Bernama in an interview inconjunction with a seminar on "Palm Biomass: Opportunities ForCommercialisation" here today.

At present, Mohd Yunus said only two companies are involved in producingpalm-nased animal feed -- LKPP Oil Palm Corp in Kuantan, Pahang and OPFIPalm Oil Company in Bota, Perak.

LKPP exports its animal feed made from oil palm fronds (OPF) to Japan andSouth Korea while OPFI exports to Japan alone. Mohd Yunus said the demandfrom Japan was between 3,000 and 6,000 tonnes a month but these two firmscan only produce 400 to 600 tonnes monthly although raw materials wereabundant in the country.

"OFPs are available in large amounts. Each time pruning is done, OFPs areleft behind (and strewn around under oil palms) as a place for snakes andrats to hide," he said.

About 300 to 350 kg of pellets can be produced from 1,000 kg of OPFs. MohdYunus said exported animal feed was in pellet form while those for thedomestic market were mixed with soyabean and corn and consumed mainly inKuala Lumpur and Melaka.

He said the feed was produced in accordance with the needs of the marketfor consumption by cattle, goats and ostriches. "We tried to produce forhorses but there has not been much demand from that side," he disclosed.

The cost of processing OPFs is between RM200 and RM250 per tonne and it issold at RM280 per tonne.

Mohd Yunus said MARDI was currently looking into reducing the drying costfor OPFs. This should lower the production cost to around RM200 per tonneand the feed could then be sold at around RM250 to RM300 per tonne, hesaid.

He said MARDI would continue to provide assistance in technology andproduction for interested industry players. Animal feed production is acollaborative project between MARDI and Japan Internation CooperationAgency (JICA) which started in 1997.

The five-year project, which concludes at the end of next year, is aimedat developing effective, practical and viable methods to convert oil palmby-products into processeed feed.

JICA provides technical expertise and equipment required by the project aswell as short-term training for MARDI personnel in Japan. MARDI, on itspart, contributes the infrastructure, operating fund and researchpersonnel for the project.

To ensure economic viability of this project, a pilot OPF processing plantwith a capacity of two tonnes per hour has been set up in MARDI'spremises. This plant will be used to study and optimise the manufacturingprocess of OPF pellets and cubes into animal feed. -- BERNAMA