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Last Updated: 04 October 2022

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MEDIA STATEMENT
MPIC ENSURES SUSTAINABILITY OF MALAYSIA’S KEY
AGRICOMMODITY PRODUCTS THROUGH DAKN 2030

1. Contrary to expectation, the two-year COVID-19/MCO (Movement Control Order) period of 2020-2021 were ‘booming years ’for Malaysia’s Agricommodity products with an overall increase of 64% from the pre pandemic period of 2018-2019.

2. Despite the country facing numerous economic devastations from the raging COVID-19 pandemic, the export value of Malaysia’s Agricommodity products remained strong, rising significantly over the four-year period from RM127.9 billion in 2018 to RM128.5 billion (2019) to RM151.3 billion (2020) and RM209.6 billion (2021).

3. To sustain the potential and growth of Malaysia’s Agricommodity industry, the National Agricommodity Policy 2021-2030 (DAKN 2030) was launched in March 2022 to further drive the
development of the country’s Agricommodity sector in a more sustainable, competitive and market-oriented manner. This is in tandem with new norms and increased leverage on digital technology in the post-COVID-19 era.

4. In essence, DAKN 2030 contains five core thrusts:

(i) sustainability;

(ii) productivity;

(iii) value-added creation;

(iv)market development; and

(v) inclusivity.

5. Below are six Agricommodity products that will benefit directly from the implementation of DAKN 2030:

(i) Palm oil: Efforts will be undertaken to increase exports and reduce stocks through export duty exemptions for crude palm kernel oil (CPKO) and processed palm kernel oil (RBDPKO) for
companies that meet the application criteria. As a result, the price of crude palm oil (CPO) has stabilised again while showing an increasing trend from June 2020 until now. In tandem with this is implementation of the Malaysian Sustainable Palm Oil (MSPO) certification to brand sustainable and quality Malaysian palm oil as well as strengthening strategic cooperation with Indonesia through the Council of Palm Oil Producing Countries (CPOPC).

(ii) Rubber: Plans are afoot to extend the use of rubber in Malaysia to road construction and the production of new and value-added products based on rubber such as seismic bearings, rubber gloves and others. At the same time Malaysia will co-operate with the world's main rubber producing countries namely Thailand and Indonesia under the framework of the International Tripartite Rubber Council (ITRC) to strengthen and stabilise international rubber market prices;

(iii) Timber: Malaysia will expand its participation in domestic and international timber, furniture and construction exhibitions to create demand for Malaysian timber products and to increase
networking and business opportunities in relevant countries; and At the same time, the country plans to increase cooperation between relevant agencies such as the Malaysian External Trade
Development Corporation (MATRADE) and the Malaysian Communications and Multimedia Commission (MCMC) to encourage the timber industry to expand access to the digital market through digital exhibition participation as well as to encourage marketing through digital platforms such as AliBaba and MineBizs, among others.

(iv) Cocoa: DAKN 2030 seeks to implement the Domestic Market Support Service Programme (KSPD) by helping cocoa farmers market their beans with reasonable purchase price offers, thus
reducing the activities of middlemen who offer uncompetitive prices. Additionally, efforts will be directed at carrying out virtual promotional activities where the industry has attended several
virtual exhibition programmes through webinar, zoom stage presentation, live chat and online business matching platforms.

(v) Pepper: A potential effort is to directly sell pepper and its related products to special or niche markets to increase the competitiveness of the Malaysian pepper industry; This entails the
introduction of value-added pepper products such as sterile pepper (Mikrokleen) and pepper powder for markets that are more concerned with food safety and quality as well as farm-level
specialty products such as creamy white pepper (LPK). So far, the Malaysian Pepper Board (MPB) has successfully penetrated the value-added pepper product market and the special pepper
market in Japan, Sweden, South Korea, China, Taiwan, Hong Kong, Spain and Polynesia, to name a few markets.

(vi) Kenaf: The initial plan is to introduce cluster farms of 20 to 50 hectares to replace small-scale farms that are less economical and cultivated by existing kenaf growers. Additionally, the focus is also to develop a Research Centre for Research, Innovation Technology And Incubation Of Small Enterprises (RINTIS) to produce entrepreneurs in premium fibre processing activities apart from increasing the research and development (R&D) efforts of kenaf at upstream, intermediate and downstream levels.

6. MPIC is committed to sustain the country's agricommodity sectors in order to ensure continuous impactful economic recovery and improvement post COVID-19, despite facing the inflation
challenge predicted to be in 2023. DAKN 2030 is the guideline for the ministry in maximizing the potential of the circular economy through agricommodity biomass. This is to strengthen the position of the agricommodity sectors in economic recovery post COVID19.

YB DATUK HAJAH ZURAIDA KAMARUDDIN
MINISTER OF PLANTATION INDUSTRIES AND COMMODITIES
26th SEPTEMBER 2022

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Last Updated: 12 May 2022

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MEDIA STATEMENT
MALAYSIA PREPARED TO ASSIST THE UK AND EUROPE IN THE SEED
OIL SUPPLY CRISIS BY SUPPLYING MALAYSIAN FULL OF GOODNESS
COOKING OIL

1. The Ministry of Plantation Industries and Commodities (MPIC) is prepared to assist the United Kingdom and Europe over their impending edible seed oil supply crisis. The British press recently indicated that the UK would run into a cooking oil crisis in weeks as the seed oil supply was choked due to the RussiaUkraine war. We are deeply concerned over the state in UK and Europe following the current situation between Russia and Ukraine. And therefore, should the UK and other European nations need our assistance, we are ready to assist with supplying edible palm oil or cooking oil for their domestic and manufacturing needs.

2. Malaysian palm oil sustainability fully adheres to the Malaysian Palm Oil Certification Council (MPOCC), which is based on the Malaysian Sustainable Palm Oil (MSPO) standards, and consistent with the international Roundtable on Sustainable Palm Oil (RSPO) requirements. We see this as a humanitarian need as Russia and Ukraine jointly supply 70 percent of sunflower cooking oil to the world.

3. Despite the anti-palm oil propaganda by some Western nations, and while we do not condone this misleading protectionist and distorted propaganda, we still want to offer our assistance in this trying time. Malaysia is a caring, friendly nation, and because of that, we are more than willing to provide Malaysian palm oil full of goodness to these affected countries.

4. This country has long battled against Western anti-palm oil propaganda, and it is time for us to put this to rest. We are ready to offer immediate assistance as we do not want to see any country suffer from a cooking oil supply crisis when Malaysia is one of the biggest palm oil producers in the world.

YB DATUK HAJAH ZURAIDA KAMARUDDIN
MINISTER OF PLANTATION INDUSTRIES AND COMMODITIES (MPIC)
29 MARCH 2022

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Last Updated: 04 October 2022

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MEDIA STATEMENT
CPO PRICE WEAKNESS IS TEMPORARY; MPIC TO FOCUS ON LONG-TERM EDIBLE
OIL VIABILITY
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1. It has to be accepted that the softening of the Malaysian palm oil futures in recent times is pretty much expected in view of the weak global stock market, arising from inflation-induced interest rate hikes which have now triggered recessionary concerns.

2. Although CPO prices have come off their peak levels that exceeded RM8,000/metric tonne in March 2022 when the Russia-Ukraine conflict sparked a shortfall in sunflower oil, Kenanga Research has forecast “a still decent” average CPO prices of RM4,500/MT for 2022 and RM4,000/ MT in 2023.

3. Production costs may be pushed up by rising fertiliser, labour and transportation costs but all-in-all, costs should stay within the RM2,000 to RM2,500 per MT range, translating to still rather healthy upstream margins for the plantation sector.

4. As it is, both palm oil (circa 35% market share) and soybean oil (circa 25% share) remain the main edible oils in the world market although palm oil production has peaked while the US soybean harvest has just started for 2022.

5. Therefore, planters – both large corporations and smallholders – must have faith in the golden crop given demand for edible oil has been growing steadily for decades supported by rising population, affluence – and to some extent – more urban lifestyle.

6. On average, consumption grew 3% year-on-year (y-o-y) during the recent decade while the 30-year average standing is even higher at 3.6% a year, according to the Kenanga Research report dated 28 September 2022 which reiterated its “overweight” outlook on the sector. Long-term prospect in tact

7. It is inevitable, however, that the negative impact of COVID-19 on economic activities, most notably the hospitality, travel and tourism sectors have weighted down palm oil demands to around 1% y-o-y since 2020.

8. However, the market report expects a reversion back to 3% growth as the global economy is gradually opening up again.

9. While concerns have been raised about demand staying subdued or even worsening due to an ensuing global economic slowdown amid hot inflation, rising interest rates and recession fears, such likelihood is only temporary as China which is a major palm oil consumer can be expected to gradually relax its zero-COVID-19 policy that has in a way hindered palm oil consumption and demand.

10.Most of all, the fundamental demand drivers are food and fuels, essential day-to-day consumables and above all else, Indonesia – the largest user of palm oil and palm biodiesel – has resumed road testing the B40 biodiesel since late July after a five- month delay. Indonesia currently runs a B30 blend with plans to adopt the B40 mix sometime this or next year.

11.Encouragingly, Malaysia’s plantation sector has also progressed with many larger concerns having already embraced the environmental, social and governance (ESG) principles as part of their day-to-day operations.

12.A testament to the success is that about 16 million MT of palm oil is now Malaysian Sustainable Palm Oil (MSPO)-certified as well as meeting some of the highest ESG standards for agriculture produce worldwide.

13.As observed by Kenanga Research, the better managed plantation groups are not resting on their laurels but pushing towards even higher palm oil yields of 6 MT per hectare which is about 10 times more efficient than other oil crops.

14.In the upcoming Budget 2023 which will be tabled on Oct 7, the Ministry of Plantation Industries and Commodities (MPIC) is pushing for a fundamental shift in strategy by focusing on intensive, yield and investment-driven growth in line with the increasing emphasis on sustainability by major producing nations and consuming markets.

15.Additionally, MPIC has also embarked on “The Global Movement to Champion the Goodness of Palm Oil” campaign to further complement efforts to boost awareness of the quality of the Malaysian palm oil as well as to counter the various misinformation and false allegations levelled at our golden oil.

YB DATUK HAJAH ZURAIDA KAMARUDDIN
MINISTER OF PLANTATION INDUSTRIES AND COMMODITIES
3rd OCTOBER 2022

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Last Updated: 21 June 2022

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MEDIA STATEMENT
PALM KERNEL WASTE AS ANIMAL FEED TO CONTROL PRICES
AND STABILISE CHICKEN SUPPLY IN THE COUNTRY

1. THE Ministry of Plantation Industries and Commodities (MPIC) will step up efforts to promote the use of palm kernel waste as animal feed to ensure Malaysia has sustainable supply of chickens in the long run.

2. As we know, one of the reasons why chicken prices sometimes soar is due to the high price of chicken feed. It has been reported that chicken feed had gone up from RM500 per tonne to RM1,900 per tonne in some cases.

3. As a result, chickens were being fed less, causing the livestock to grow slower than normal, and in the process restricting the supply of the birds. Malaysia imports most of its chicken feed, mostly made of grain like corn and soybean. These items are facing worldwide shortage due to the war in Ukraine and uncertain weather patterns.

4. However, Malaysia's oil palm plantations produce huge supplies of palm kernel waste. Past researches have shown that feeding fermented palm kernel cake (PKC) and high dietary fat to broilers, can be a good substitute for the imported feed which almost all commercial chicken farms use today.

5. The MPIC will also hold discussions with other stakeholders to review our export policy on PKC in favour of local broilers. Right now, a lot of our PKC is exported for the European cattle industry.

6. The Ministry will also work with relevant agencies, government-linked companies (GLCs) and State Governments to urgently look into how it can quickly ensure the availability of palm kernel waste as animal feed for the Malaysian poultry industry.

7. Additionally, the MPIC will also be working closely with research institutes such as public universities to look into ways to enhance the quality of PKC to make it the preferred choice for chicken breeders. This includes ways of reducing the fibre content in the PKC.

8. MPIC is committed to playing its part to help reduce Malaysia’s dependence on imported livestock feed, in the spirit of Keluarga Malaysia. At the end of the day, it's about putting the interests of the people first and The Ministry is determined to ensure the commodity sectors consistently contribute to the country’s economic development.

YB DATUK HAJAH ZURAIDA KAMARUDDIN
31 MAY 2022