Malaysia looking at sustainable oil crop

Rising palm oil prices have begun to drive the
bio-diesel industry to seek cheaper alternatives. Jatropha is seen as an
important feedstock, the plantation of which will enjoy a long life running to
40-50 years. Within Malaysia, the progress of the bio-diesel programme is
stalled because of high prices. For bio-diesel producers, margins are squeezed.

Palm oil prices issue
High palm oil prices have
already generated considerable consternation within the country and outside.
Escalation of the currently muted food versus fuel debate may negatively impact
palm oil in future, it is feared.

Sustainability is already a hotly
debated topic. Critics of palm oil raise issues of deforestation and loss of
habitat for wildlife. Seeing this as motivated campaign, the Malaysian
government and industry together have begun to counter the allegations. As first
of a series of steps, a conservation fund for wildlife has been established.

Malaysian officials have also hit out against the concerted efforts of
lobbies in Europe and other places to denigrate plam oil. A senior official
pointed out that while Malaysia promotes sustainability (Roundtable on Sustainable Palm Oil
(RSPO) was set up in 2004), there was no such efforts on part of soyabean
and rapeseed producers.

Sustainability
On the other hand,
genetically-modified soyabean did not fall within the definition of
sustainability, the official said. Obviously, there is a case for all oils and
oilseeds producers to work together to ensure sustainable agriculture.

Bursa Malaysia (BMD) will soon launch a US dollar-denominated crude palm
oil futures contract. The exchange is currently finetuning the ‘soft
infrastructure’ and is keen to have a successful launch of the derivatives
contract, an exchange official asserted.

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