09/05/2011 (The Korean Times) - With palm oil gaining popularity for its wide range of uses ­ from cooking to alternative fuel ­ Malaysia stands ready to supply greater amounts to Korea, an official said.

Palm oil products from Malaysia, Korea’s leading palm oil supplier, took the spotlight at a recent trade fair in Seoul organized by the Malaysian Palm Oil Council (MPOC) and the Korean Society of Food Science and Technology (KSFST).

“Malaysia takes its position as South Korea’s favored palm oil supplier seriously,” said Tab Sri Bernard Dompok, Malaysian minister for plantation industries, in a keynote speech. “We will continue to foster closer ties and encourage further use of palm oil in both the food and non-food sectors.”

The affordable oil has emerged as a source of alternative energy at a time when crude oil prices have soared. Its products represent 21 percent of the oil and fats industry here.

So far Korea, which imports a vast majority of its palm oil from Malaysia, uses it mainly in instant noodle and snack food production. But Seoul recently implemented a biodiesel mandate of 2 percent by 2012, a move Dompok said bodes well for the strengthening of economic ties between the sides.

“Palm-based biodiesel is both environmentally-friendly and reduces dependency on fossil fuels,” he said. “I’m sure the private sectors of both countries can explore this opportunity.”

Dompok said palm oil supplied to Korea would “adhere to sound practices of good agriculture and sustainable management,” dismissing “unsubstantiated” claims that production had hurt the environment.

Groups such as Greenpeace have raised protest over the industry, saying it clears habitats of endangered species and contributes to deforestation.

In Australia, a lawmaker is pushing for the labeling of products containing palm oil, citing the endangerment of orangutans and other animals.

The MPOC has hit back, saying Malaysia had marked more than half if its total land area as permanent forest and that the industry was vital to alleviating poverty in Malaysia.

Dompok vigorously defended the benefits of the oil.

“Oil palm plantations yield ten times more output compared to competing oilseeds. As global population continues to grow, the industry must be able to meet the increased demands for vegetable oils arising from population expansion and income growth,” he said.

For Malaysia, the industry is a pillar to its economy, raking in almost $20 billion last year. The Southeast Asian country accounted for 46 percent of total palm oil exports worldwide. The profits have played a key role in helping to alleviate poverty, the minister said.

He said wages in the industry have tripled over the last few decades and that palm oil conglomerates have expanded into other sectors, “providing jobs and employment opportunities for a large number of Malaysians.”

With Korea’s oils and fats market growing at some 5.5 percent annually, conditions look favorable for palm oil to make inroads in home consumption.

But it will have to compete with the rising popularity of grape seed oil, favored for its high smoke point, and olive oil, which is quickly gaining ground for its health benefits.

Palm oil has a tendency to cloud in winter, limiting use in Korean households, despite its lower price tag. It is also high in saturated fat, but it is hoped that blends with other vegetable oils will increase its appeal in the market obsessed with “well-being” foods.

“With blending techniques and new technologies being developed, palm oil can gradually make its way into kitchens here,” he said.
In 2010, palm oil ranked second among major vegetable oil imports with a 22.3 percent share behind only soy bean oil at 27.3 percent.
Those were followed by coconut oil (7.1 percent), rapeseed oil (6.5 percent), olive oil (3.5 percent), sunflower oil (2.7 percent) and others.

Imports of the oil amounted to 87 percent of all local imports from Malaysia.

The minister said that the robust trade reflected economic ties seeped in history. This year marks the 51st anniversary of diplomatic ties between the sides.

“We’ve supported each other ever since our economies were in still at the infancy stages. Today, the strength of that relationship and the maturity of our economies are reflected by, among others, the volume of palm oil traded between our two countries,” he said.

The palm oil trade fair, held at the Renaissance Hotel in Seoul, was the 17th of its kind organized by MPOC and KSFST.