Asia Palm Oil Magazine Oct-Dec 2025 by fbipublicationsmalaysia

13 Associations Unite to Call for Reinvestment of Windfall Profit Levy Into The Plantation And Commodities Sector

Johari: RM1.4B Over Five Years to Replant Ageing Oil Palm Trees

In Malaysia’s Palm Oil Heartland, Smallholders are Redefining What it Means to Grow Responsibly

IN THE HOT SEAT

Innovative Power Transmission Solutions Driving Efficiency and Sustainability in the Oil Palm Industry

In recent months, Malaysia’s palm oil sector has taken a significant step forward on the global stage. The Ministry of Plantations and Commodities has reaffirmed that Malaysia is firmly on track to be recognised as a low-risk producer of palm oil, a status that carries immense weight in international trade.

This progress is driven by the nationwide adoption of the Malaysian Sustainable Palm Oil (MSPO) certification, which underscores our industry’s commitment to responsible cultivation, environmental stewardship, and fair labour practices. With Europe tightening its sustainability requirements, Malaysia’s proactive stance positions our palm oil not just as a commodity, but as a trusted, sustainable, and competitive choice for buyers worldwide.

For our readers—industry leaders, growers, processors, and policy makers— this recognition will open doors to new markets, strengthen Malaysia’s reputation, and ensure that our palm oil remains at the forefront of global supply chains. It is a reminder that sustainability is not just compliance, but a strategic advantage for the future of our industry.

In this edition, we are pleased to feature an exclusive interview with Sumitomo (SHI) Cyclo Drive Asia Pacific Pte Ltd, who share insights on “Innovative Power Transmission Solutions Driving Efficiency and Sustainability in the Oil Palm Industry.” Their expertise highlights how advanced technology and engineering can further enhance productivity and sustainability across plantations and processing facilities.

As we close another year, let us take pride in this achievement and continue to innovate, collaborate, and uphold the standards that make Malaysian palm oil a benchmark for the world. On behalf of the editorial team, I would like to extend our heartfelt gratitude to all our readers for your continuous support of Asia Palm Oil Magazine. Your trust and engagement inspire us to keep delivering the latest insights and perspectives shaping our industry.

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The assertions and opinions expressed in articles and announcements on this magazine reflect the views of the author(s) and do not (necessarily) reflect the views of the publisher. Asia Palm Oil Magazine can in no way be held responsible for the content of such views nor can it be held liable for any direct or indirect damage that may arise from such views.

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08 - FGV Shows Resilience as Earnings Rise to RM136mil for 2Q25

10 - Genting Plantations Seed Venture to Bolster Diversification

12 - KLK Earnings Buoyed By Biodiesel, Refining Still Weak, Says HLIB

14 - 13 Associations Unite to Call for Reinvestment of Windfall Profit Levy Into The Plantation And Commodities Sector

16 - Sawit Kinabalu Tackles Child Labour Through Education and Welfare Programmes

18 - SD Guthrie Responds to Indonesian Forest Permit Concerns

20 - EU, Malaysia Join Forces on DeforestationFree Trade

22 - Johari Ghani: US Curbs Unlikely to Shake Malaysia’s Palm Oil Sector

24 - Johari: RM1.4B Over Five Years to Replant Ageing Oil Palm Trees

26 - Palm Oil and Rubber Model Can Drive Malaysia’s Global Food Ambitions – MIER

28 - Malaysia-Indonesia Pact Sets Stage for Energy, Labour Protections, Strategic Halal and Palm Oil Leadership

30 - Plantation Firms Train SPM School-Leavers Under Govt’s Foreign Labour Cut Drive

32 - India Buys 301,000 Tonnes of Malaysian Palm Oil in July, Highest in Nine Months

34 - Rising Regulatory Risks May Force Planters to Scale Back in Indonesia

36 - Indonesia Develops Bioethanol from Palm Oil Waste for Energy Swift

Backed by Bill Gates, Singapore’s Terra Oleo Raises $3.1M to Turn Waste into Palm Oil

Genting Plantations Seed Venture to Bolster Diversification

GREEN SOLUTIONS

38 - CO₂ Recycling Powers a New Palm Oil Alternative for The Cosmetics Industry

40 - Palm Oil Unpacked: Separate Fact from Fiction on Cholesterol

42 - Sabah Leads in Sustainable Palm Oil with 97pct MSPO Certification

44 - Microalgae Systems Transform Palm Oil Waste into Energy

48 - Backed by Bill Gates, Singapore’s Terra Oleo Raises $3.1M to Turn Waste into Palm Oil Substitutes

PLANTERS CORNER

52 - In Malaysia’s Palm Oil Heartland, Smallholders are Redefining What it Means to Grow Responsibly

54 - MPOB and Earthworm Foundation Renew Partnership to Strengthen Smallholder Sustainability

58 - Innovative Power Transmission Solutions Driving Efficiency and Sustainability in the Oil Palm Industry

62 - Overcoming the 3 Big Challenges in Palm Oil Process Instrumentation

66 - IBG Biofertilizer Series Is Malaysia’s First Biofertilizer That Has Been Certified as EcoFriendly Product Under SIRIM ECO 013:2024.

68 - How China Can Help Rewrite the Future of Indonesian Palm Oil

72 - Indonesia Pushes for South-South Cooperation on Palm Oil Sustainability Standards

76 - Not All Types of Palms Are Created Equal

80 - Insight: Old Trees and Ageing Farmers Worsen Outlook for Top Palm Oil Exporters

Innovative Power Transmission Solutions Driving Efficiency and Sustainability in the Oil Palm Industry Indonesia Pushes for South-South Cooperation on Palm Oil Sustainability Standards

FGV Shows Resilience as Earnings Rise to RM136mil for 2Q25

FGV posted a 5% y-o-y rise in revenue to RM5.8bil in the quarter.

FGV Holdings Bhd posted a 58% year-on-year (y-o-y) rise in earnings to RM136mil, or earnings per share (EPS) of 3.75 sen, for the second quarter ended June 30 (2Q25), helped by an improved performance from its oil palm plantation division.

FGV, which will delist from the Main Board of Bursa Malaysia today, posted a 5% y-o-y rise in revenue to RM5.8bil in the quarter, assisted by higher fresh fruit bunch (FFB) production and firmer crude palm oil prices.

The quarter performance was impacted by a softer performance for its downstream businesses particularly by the oils and fats division. The land lease agreement fair value charge in the quarter rose to RM131.84mil from RM66.68mil in the corresponding period last year.

“Our performance this quarter reflects FGV’s resilience and ability to adapt in a challenging environment. We are steadily progressing in strengthening our core businesses while building new growth pathways that will position FGV for the future,” said Fakhrunniam Othman, group chief executive officer of FGV.

FGV’s plantation division posted a higher profit of RM157mil in 2Q25 compared to RM101mil in 2Q24, supported by higher FFB production at 1.13 million tonnes.

Estate operational costs declined by 21% on-year in the period while the oil extraction rate was slightly lower at 20.09% versus 20.48% in 2Q24.

Total FFB received in 2Q25 increased by 5% to 3.85 million tonnes.

In total, 1.12 million tonnes of 29% of FFB was produced internally by FGV estates, 1.1 million tonnes (29%) was sourced from third parties and the remaining 1.63 million tonnes (42%) of FFB were received from the Federal Land Development Authority (Felda) settlers.

In a release, FGV stated FFB production in the second half of the year will be stronger and it will continue to prioritise operational excellence, expanding value-added offerings, strengthening market presence and enhancing both capacity and supply chain efficiency.

Fakhrunniam said post delisting, FGV will focus on three priorities – improving productivity, seeking growth and its people.

FGV has been taken private by Felda and persons acting in concert on the second attempt after tabling a RM1.30 a share offer to other shareholders.

Genting Plantations Bhd’s venture into the vegetable seeds business could accelerate its diversification beyond palm oil and unlock recurring income from high-value crops.

Genting Plantations Seed Venture to Bolster Diversification

Genting Plantations Bhd’s venture into the vegetable seeds business could accelerate its diversification beyond palm oil and unlock recurring income from high-value crops, Public Investment Bank Bhd (PublicInvest) said.

Under the joint venture (JV) agreement, Genting Plantations will establish two JV companies with Shouguang Vegetable Science and Technology S/B (SVST).

Genting Plantations will hold a 60 per cent stake through AGCT Vegetable AgVentures S/B, while SVST will own the remaining 40 per cent in both JV companies.

The collaboration aims to develop about 28 hectares in Kulai, Johor, into a tropical vegetable centre of excellence, serving as a hub to promote sustainable growth and strengthen food security.

PublicInvest noted that leveraging SVST’s vast experience could help accelerate the business development.

“The new business venture will help Genting Plantations reduce its heavy reliance on the upstream palm oil segment while unlocking a recurring revenue stream in the high-value vegetable crops market.

“Genting Plantations plans to fund the business through internal funds or bank borrowings, which should not pose an issue given its current low gearing position of 0.23 times and sizeable cash reserves of RM1.9 billion.

“Based on Genting Plantations’ 60 per cent stake in both JV companies, it is required to fork out about RM315 million,” it said in a research note.

Separately, PublicInvest said Genting Plantations’ second quarter results for the financial year 2025 are scheduled to be released on Aug 27, and it expects another solid performance.

This outlook is underpinned by steady crude palm oil prices and moderate fresh fruit bunch production growth.

The firm has reiterated its “Outperform” call on Genting Plantations, with an unchanged target price of RM5.61.

Meanwhile, CIMB Securities Sdn Bhd views the proposed JV as neutral, noting that it will broaden the group’s exposure to seed breeding, research and development (R&D), and greenhouse production.

However, it expects limited near-term earnings contribution due to the likely high upfront capital expenditure (capex).

“Genting Plantations’ 60 per cent share of the potential investment in the JV companies amounts to about RM315 million, and we believe the project is unlikely to be earningsaccretive in the near term given the substantial upfront capex required for technology acquisition and seed-breeding R&D facilities.

“The JV also represents a diversification away from Genting Plantations’ core palm oil business.

“That said, proceeds from its recent disposal of agricultural land in Melaka to Scientex Bhd for RM333.8 million should be sufficient to fund this investment,” it noted.

CIMB Securities has maintained a “Hold” rating on Genting Plantations with an unchanged target price of RM5.28.

In a report, HLIB Research said that near-term prospects at the manufacturing segment, however, will remain challenging due to competitive selling prices and volatile feedstock costs, which will cap margins at the refining operations.

KLK Earnings Buoyed by Biodiesel, Refining Still Weak, Says HLIB

Kuala Lumpur Kepong Bhd (KLK) expects earnings at the plantation to remain resilient in the near term, backed by firm biodiesel demand from Indonesia.

“Besides, management also highlighted the potential of incurring impairment on its investment in Synthomer in the fourth quarter, given the challenging operating environment,” it said in a note.

The firm raised its net profit forecasts for the group by 16.2 per cent for financial year 2025 (FY25) and 0.4 per cent for FY26 and FY27 to reflect lower crude palm oil (CPO) production cost assumption.

It added that KLK’s earnings beat expectations, accounting for 86.4 per cent and 88.9 per cent of consensus and the firm’s fullyear estimates.

HLIB Research maintained a ‘Buy’ call on the stock with a higher target price (TP) of RM24.65.

KLK posted a higher net profit of RM346.59 million for the third quarter ended June 30, 2025 (Q3FY25), compared with RM240.18 million in the same period last year.

Revenue increased to RM6.43 billion in the quarter under review from RM5.50 billion previously.

In a separate note, CIMB Securities expects KLK’s earnings to soften in Q4FY25, weighed down by lower crude palm oil and palm kernel prices as well as associate losses.

“We are keeping our earnings forecasts unchanged for now, pending further clarification from KLK on the stronger-thanexpected palm product prices achieved in Q3FY25,” it said in a note.

The firm maintained its ‘Hold’ call on KLK and a TP of RM21.5

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13 Associations Unite to Call for Reinvestment of Windfall Profit Levy Into The Plantation And Commodities Sector

1. Malaysian Palm Oil Association (MPOA)

2. Malaysian Estate Owners’ Association (MEOA)

3. Sarawak Oil Palm Plantation Owners Association (SOPPOA)

4. East Malaysian Planters Association (EMPA)

5. Sarawak Dayak Oil Palm Planters Association (DOPPA)

6. Palm Oil Millers Association (POMA)

7. Malayan Edible Oil Manufacturers’ Association (MEOMA)

8. Malaysian Oleochemical Manufacturers (MOMG)

9. Malaysian Biodiesel Association (MBA)

10. Malayan Agricultural Producers Association (MAPA)

11. Incorporated Society of Planters (ISP)

12. Palm Oil Refiners Association of Malaysia (PORAM)

13. National Association of Smallholders (NASH)

The 13 associations under the Plantation and Commodities sector, calls on the Government to reinvest collections from the Windfall Profit Levy (WPL) into the plantation and commodities industry through the Ministry of Plantation and Commodities (KPK).

Despite repeated appeals, the WPL continues to burden the plantation industry. The industry highlights that the continuous implementation of the so-called “Windfall” Profit Levy has created additional costs and imbalances, particularly when plantation companies are already required to subsidise the nation’s cooking oil programme on behalf of the Government. No other industry has been singled out in this way.

The associations stress that funds collected from WPL must not disappear into general revenue but instead be channelled back to strengthen the sector in the following areas:

1. Replanting – High costs and insufficient incentives have slowed down replanting, threatening future yields. Directing WPL funds into a structured planting cess would allow soft loans and targeted support to rejuvenate ageing estates.

2. Mechanisation & Technology – Rising input and labour costs require urgent adoption of mechanisation, automation, and green energy. WPL funds should be used for R&D, tax incentives, and pilot projects that improve efficiency and reduce reliance on foreign workers.

3. Sustainability & Market Access – The industry is under increasing global scrutiny to comply with deforestation rules, carbon credit requirements, and renewable energy standards. Channelling WPL collections into sustainability initiatives such as biogas, biomethane, and carbon certification is critical to preserving Malaysia’s market access.

4. Cooking Oil Subsidy / Price Stabilisation – With crude palm oil (CPO) prices elevated and exceeding RM3,900 per tonne, cooking oil manufacturers and packers continue to bear heavy losses in maintaining the Government’s ceiling price for the bottled cooking oil programme. The current ceiling price of RM2.50 per kg is unsustainable and the gap between actual CPO prices and subsidised oil prices is widening. This not only places extreme financial strain on manufacturers but also raises concerns about the sustainability of the subsidy system itself.

The associations urge the Government to urgently review the ceiling price of bottled cooking oil to reflect market realities, or alternatively, allocate part of the WPL collections to offset the subsidy burden borne by the industry. Without such relief, the continuation of this policy risks eroding industry viability and undermining supply stability.

The associations further call for a review of the WPL threshold to ensure it truly reflects a “windfall” situation, rather than taxing the industry at levels close to production costs. With current production averaging RM2,600–3,000 per tonne and fertiliser costs rising by 30% since late 2024, the existing levy of RM150 per tonne is punitive rather than reflective of extraordinary profits.

“The Windfall Profit Levy cannot remain just another source of government revenue. It must be reinvested into the plantation and commodities industry to drive replanting, mechanisation, sustainability, and to ease the cooking oil subsidy burden. At today’s costs, the situation is unsustainable. Redirecting WPL funds back to the Ministry is the only fair and logical path forward,” said the associations collectively.

The associations reiterate its commitment to national food security, rural development, and economic sustainability. But this requires a fairer framework where funds collected from the industry are reinvested into the industry itself.

Sawit Kinabalu Tackles Child Labour Through Education and Welfare Programmes

BY SAWIT KINABALU

Although Sawit Kinabalu’s core business is palm oil production, the company places significant emphasis on protecting and nurturing the education and welfare of children living within and around its plantations.

This commitment is demonstrated through a range of targeted programmes aimed at preventing child labour and promoting access to education.

Sawit Kinabalu Group sustainability general manager Nazlan Mohamad said the state-owned company has established 28 Community Learning Centres (CLCs) across Sabah to address barriers to education among children of plantation workers.

Six of them are located in Tawau, seven in Lahad Datu, six in Sandakan, four in Kudat, and five in Beaufort.

“To ensure better access to education, Sawit Kinabalu builds and maintains CLCs within our estates, reducing travel difficulties and costs for families.

“We also provide early childhood education centres and operate transportation services to safely shuttle children from workers’ housing to nearby schools,” Nazlan told the New Straits Times.

These measures are designed not only to facilitate learning but also to prevent children from accompanying their parents to work sites, where they may be exposed to hazardous conditions.

Beyond education, Sawit Kinabalu invests in health services, operating clinics within plantation areas that offer maternal and child healthcare, including vaccinations and routine check-ups, to support overall child development and well-being.

The company also undertakes extensive awareness programmes targeting workers and their families, focusing on the risks of child labour, the importance of education for longterm personal and community development, and the legal repercussions of involving children in work.

“We conduct parental training sessions to discourage the common practice of children ‘helping out’ on plantations, which often leads to them performing tasks beyond their capability and legal limits.”

To enhance monitoring and enforcement, Sawit Kinabalu has formed community monitoring groups comprising workers, local leaders and educators, who identify and report potential cases of child labour.

The company also provides anonymous reporting channels to encourage confidential disclosures without fear of retaliation.

In Sabah, there are approximately 2.1 million workers, including a significant number of non-resident employees.

In 2023, there were 796,900 registered PBPs in Sabah, employed by 37,646 companies.

Indonesians comprised the majority at 90.2 per cent, followed by Filipinos at 7.9 per cent, with smaller groups from Nepal and Cambodia.

Agriculture, particularly oil palm plantations, is among Sabah’s largest employment sectors, with around 591,800 workers. Of these, 58 per cent (roughly 344,700) are non-citizens, many of whom work in the oil palm industry.

Children of non-resident employees typically face challenges accessing education due to insufficient documentation, affordability issues, and the distance from the nearest schools.

Tuai Cerita is a fellowship designed to amplify the voices of Sabah’s most vulnerable children.

Through the power of storytelling and ethical journalism, the programme shines a light on child rights deprivations that contribute to child labour in and around oil palm plantations in Sabah.

The programme is driven by local partners Anak and Global Shepherds, and implemented by Project Liber8.

It is conducted in partnership with the European Union, the International Labour Organisation (ILO), and Unicef.

SD Guthrie Responds to Indonesian Forest Permit Concerns

SD Guthrie Bhd says less than three per cent of its 180,000 hectares of planted oil palm area in Indonesia is currently under review by the Indonesian government.

Addressing concerns over reports suggesting that some of its Indonesian subsidiaries may be operating in forest-designated areas without permits, group managing director Datuk Mohamad Helmy Othman Basha said the matter is not unique to SD Guthrie.

Similar overlaps have affected both Malaysian and Indonesian plantation companies operating in the country, he added.

CIMB Securities recently highlighted growing regulatory risks for Malaysian plantation companies operating in Indonesia.

This followed the Indonesian government’s move to seize land lacking proper forestry permits or in violation of land-use laws.

SD Guthrie’s Indonesian subsidiaries were listed in an official decree, with 3,045 hectares under scrutiny, 1,874 hectares currently under the legalisation process and 1,171 hectares reportedly rejected.

“For context, our total planted area in Indonesia is about 180,000 hectares. Less than three per cent of this has been flagged by the authorities as overlapping with forest zones,” Helmy said at a press briefing here today.

“However, we have our own data that disputes this, and discussions with the Indonesian government are ongoing,” he added.

Helmy said SD Guthrie continues to manage operations in the affected areas and is in active discussions with the Indonesian government to resolve the land classification concerns

Group chief operating officer Mohd Haris Mohd Arsyad said the issue is not about illegal clearing or expansion, but rather differing interpretations of land use boundaries.

“There’s the Perhutanan (forestry) map, and then there’s the map from the ministry that gives us our licenses. Much of this happened before we acquired the land,” he said.

The land in question was acquired from the Indonesian government in 2001 during a post-financial crisis asset restructuring.

Helmy likened the acquisition to Malaysia’s Danaharta model, saying that it was conducted with representations and warranties from the government.

Chief financial officer Renaka Ramachandran clarified that SD Guthrie should not be associated with deforestation, as the plantations were already established prior to the acquisition.

“We never planted the land ourselves. We bought ready-made plantations, and the agreement came with assurances from the government. Accusations of deforestation should not arise,” she said.

The executives reiterated that SD Guthrie holds valid land titles and has complied with relevant processes.

They acknowledged that resolving the matter will require time and continued engagement with authorities.

“We’re confident this will be resolved, but it’s a complex issue that requires ongoing dialogue with the government,” said Haris.

SD Guthrie Bhd says less than three per cent of its 180,000 hectares of planted oil palm area in Indonesia is currently under review by the Indonesian government.

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EU, Malaysia Join Forces on Deforestation-Free Trade

The European Union (EU) and Malaysia will strengthen cooperation to help operators sourcing palm oil, rubber, timber and cocoa prepare for the upcoming EU Deforestation Regulation (EUDR).

In a statement on its website, the Delegation of the European Union to Malaysia said the collaboration aims to deliver mutual benefits for stakeholders on both sides, particularly in ensuring the smooth trade of deforestation-free and legally sourced commodities.

“European Commissioner for Environment, Water Resilience and a Competitive Circular Economy, Jessika Roswall, expressed strong appreciation for Malaysia’s efforts to align its national sustainability certification schemes with EUDR requirements,” it said.

The statement said that the Malaysian Sustainable Palm Oil (MSPO) certification had been recognised as a credible sustainability scheme with a high-standard digital traceability system, which could help EU operators sourcing palm oil from Malaysia met compliance requirements.

Plantation and Commodities Minister Datuk Seri Johari Abdul Ghani highlighted Malaysia’s establishment of a national centralised system — a single platform integrating traceability records, polygon maps, MSPO certification data and legality confirmation.

Roswall also commended Malaysia’s constructive cooperation and its efforts to reduce deforestation to unprecedented lows, noting the government’s commitment to strengthening measures against agriculture-driven deforestation.

“The EU views Malaysia’s efforts to ensure certified commodity production and transparent supply chains in palm oil, rubber and timber as highly significant,” the statement said.

During her visit, Roswall proposed holding a virtual technical workshop to raise awareness of the EUDR among Malaysian stakeholders.

Plantation and Commodities Minister, Datuk Seri Johari Abdul Ghani, and European Commissioner for Environment, Water Resilience and a Competitive Circular Economy, Jessika Roswall, with the Mah Meri indigenous people during a visit to an oil palm plantation in Kampung Sungai Judah, Pulau Carey. NSTP/ EIZAIRI SHAMSUDIN

She also stressed the EU’s readiness to work with Malaysia to strengthen deforestation-free supply chains, including through a project supporting smallholder farmers in supplying traceable sustainable palm oil and rubber to the EU market.

Roswall and Johari later visited Pulau Carey, where they observed local empowerment initiatives for indigenous communities and regenerative farming guided by MSPO’s Good Agricultural Practices.

The delegation also toured Sime Darby Plantation’s operations on the island, where the company showcased its efforts to drive traceability and transparency across its supply chain.

“Examples presented on the island, ranging from indigenous smallholders to large-scale plantations, gave EU regulators the opportunity to see first-hand Malaysia’s comprehensive sustainability measures in the palm oil sector.

“This demonstrates that sustainability practices are being rigorously implemented across the industry, regardless of scale or production size,” the statement added.

Source: www.nst.com.my

Johari Ghani: US Curbs Unlikely to Shake Malaysia’s Palm Oil Sector

The impact of market restrictions or challenges in the United States (US) on Malaysia’s palm oil industry is expected to be minimal, Plantation and Commodities Minister Datuk Seri Johari Ghani said.

Malaysia exported a total of 191,231 metric tonnes of palm oil to the US last year, representing only 1.1 per cent of the country’s total palm oil exports for 2024, he said.

“Malaysian palm oil is certified sustainable under the Malaysian Sustainable Palm Oil (MSPO) certification and possesses specific characteristics and functions that are difficult to replace with other oils.

“Therefore, the level of dependence by the United States industry on sustainable palm-based products is high.

“Based on these factors, the direct impact of restrictions or market challenges in the United States on Malaysia’s palm oil industry is expected to be minimal,” Johari said in a written parliamentary reply.

Malaysia is the world’s second-largest producer of palm oil, after neighboring Indonesia.

While Indonesia holds the top position, Malaysia plays a significant role in the global palm oil market, both in production and exports.

Palm oil is an edible oil used in everything from cakes, chocolate, margarine, and frying fats to cosmetics, soap, shampoo, and cleaning products.

India and China are the major importers of Malaysian palm oil. Other significant markets include the European Union and Turkey.

Johari added that about 70 per cent of Malaysia’s palm oil production is led by estates or plantation companies that also export palm oil, making the Malaysian palm oil industry strong and dynamic in facing international market challenges.

The impact of market restrictions or challenges in the United States (US) on Malaysia’s palm oil industry is expected to be minimal, Plantation and Commodities Minister Datuk

Seri Johari Ghani said. – PIC CREDIT: FB/ParlimenMY

At the same time, he said, the government remains committed to providing various forms of support, particularly to smallholders.

This is done through the Replanting Financing Scheme for Smallholder Palm Oil Farmers, as well as special grants such as the supply of products to control Ganoderma basal stem rot disease.

“Such assistance helps mitigate the impact on Malaysian smallholders from changes in international trade policies,” he said.

Johari was responding to Kamal Ashaari (PN–Kuala Krau) on the short- and medium-term action plans drawn up by the government to help the palm oil industry adapt to the more challenging United States market.

He was also asked by Chong Zhemin (PH–Kampar) about efforts to assist rubber and palm oil smallholders in facing the global commodity price decline.

Johari said the ministry remains committed to protecting the welfare of palm oil smallholders through several strategic measures.

These include the RM100 million replanting scheme in collaboration with Agrobank, which combines grants and lowinterest loans, as well as a grant allocation of up to RM200,000 for weighing centres under the Sustainable Palm Oil Growers’ Cooperative (KPSM).

Smallholders are also eligible for interest-free financing of up to RM300,000 through the Easy Financing Scheme (SPM) to strengthen their competitiveness.

In addition, RM50 million has been allocated under Budget 2025 to support the implementation of the MSPO certification, covering costs for training, documentation, certification, and protective equipment.

On the rubber sector, Johari said global prices are largely determined by supply and demand, limiting the government’s ability to intervene, as Malaysia contributes only 3.3 per cent of global output.

He said the ministry has introduced several initiatives, including the Consolidation Programme to provide more stable income opportunities, the Rubber Production Incentive (IPG) with a raised activation price of RM3 per kilogram, and the Latex Production Incentive (IPL+) to encourage a shift to higher-yield latex production.

Johari said the ministry has also rolled out the National Rubber Industry Transformation Programme (TARGET), aimed at boosting smallholders’ income by shortening the supply chain through greater participation in the industry’s value chain.

Johari: RM1.4B Over Five Years to Replant Ageing Oil Palm Trees

Plantation and Commodities Minister Datuk Seri Johari Abdul Ghani said the initiative under the 13th Malaysia Plan (13MP) aligns with the government’s goal of strengthening Malaysia’s position as the world’s second-largest palm oil producer. NSTP/ NAJMI NOR’AZAM

Under the 13th Malaysia Plan (13MP), the government is expected to allocate RM1.4 billion over the next five years to support smallholders in replanting ageing oil palm trees.

Plantation and Commodities Minister Datuk Seri Johari Abdul Ghani said today that the initiative aligns with the government’s goal of strengthening Malaysia’s position as the world’s secondlargest palm oil producer.

“The parliamentary debate on the 13MP begins tomorrow, and we expect valuable feedback from members of parliament.”

Johari added that the ministry is making a strong push to assist smallholders with replanting.

He said about RM1.4 billion will be required over five years — not annually — to encourage smallholders to rejuvenate aging plantations with higher-yielding varieties.

He said this after officiating the Umno Johor Baru conference here, accompanied by division chief Datuk Yahya Jaafar.

He was responding to questions about the 13MP, which was tabled in Parliament on Thursday by Prime Minister Datuk Seri Anwar Ibrahim.

While tabling the 13MP, Anwar reaffirmed the government’s resolve to revitalise strategic sectors, including agricultural commodities, the halal industry, and Islamic finance, by boosting productivity in palm oil, rubber, and cocoa through modern technologies such as mechanisation, automation, robotics and targeted R&D.

Johari, who also serves as the natural resources and environmental sustainability minister, said an aggressive replanting initiative would boost Malaysia’s export potential and strengthen its global market share.

“Malaysia’s commodity exports stand at about RM115 billion, and this replanting initiative is expected to contribute to our export growth.

“If we can upgrade and replant large areas of ageing oil palm trees, it will boost our capacity and competitiveness in the global palm oil market.”

Palm Oil and Rubber Model Can Drive Malaysia’s Global Food Ambitions –MIER

Its chairman, Tan Sri Mohd Effendi Norwawi, said the country should start viewing agriculture and food security as a strategic growth sector rather than a recurring policy issue. STR/HAZREEN MOHAMAD

Malaysia can become a global food producer by emulating its success in the palm oil and rubber industries, according to the Malaysian Institute of Economic Research (MIER).

Its chairman, Tan Sri Mohd Effendi Norwawi, said the country should start viewing agriculture and food security as a strategic growth sector rather than a recurring policy issue.

“Agriculture and food security have always been on the agenda, even from the 1970s, but it is time for the government to examine it more closely, reprioritise the sector, and elevate it to a top national priority,” he said after the MIER Brown Bag Talk Series -- “A Journey Through the Looking Glass: Towards Future-Proofing Malaysia’s Food Security”.

Mohd Effendi, a former minister of agriculture and food security, said Malaysia’s food import bill, supply vulnerabilities, and global disruptions such as war, pandemics, and climate change highlight the urgent need for a new approach.

“We have achieved success in palm oil and rubber, and we can apply this model to food production, particularly by utilising modern technology and the extensive knowledge we possess,” he said, citing institutions like the Malaysian Agricultural Research and Development Institute (MARDI) and the country’s network of agriculture professionals.

Mohd Effendi highlighted that beyond agriculture, other emerging areas such as artificial intelligence (AI) and sustainability should be central to the 13th Malaysia Plan (13MP).

“AI is an area we must move forward with. Malaysia is still at the starting line, so we have an opportunity to jump-start our progress.

“We can move quickly into areas like AI and sustainability, where we already have national experts and can bring in international ones to help shape strong policies and strategies,” he said.

The talk featured presentations by MIER senior fellows Dr Larry Chee-Yoong Wong and Khairuddin Md Tahir, who advocated for a systemic shift in how Malaysia addresses food security.

The event is part of MIER’s ongoing Brown Bag Talk Series aimed at fostering policy dialogue on key national issues.

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Malaysia-Indonesia Pact Sets Stage for Energy, Labour Protections, Strategic Halal and Palm Oil Leadership

Indonesian President Prabowo Subianto and Malaysian Prime Minister Datuk Seri Anwar Ibrahim have agreed to strengthen bilateral cooperation in trade, investment, energy, and cross-border connectivity, while supporting efforts to expand opportunities in strategic sectors.

In a joint statement following the 13th Annual Consultation in Jakarta on Tuesday, both leaders welcomed the convening of the First Malaysia-Indonesia Investment Cooperation Working Group on September 2, 2024 in Indonesia, aimed at enhancing trade and investment ties.

“Both leaders noted new investment prospects in sectors such as infrastructure, electronics, pharmaceuticals, and medical devices, and pledged greater collaboration on food security and sustainability initiatives, including carbon trading,” stated the statement released by Malaysia’s Foreign Ministry on Wednesday night.

Prabowo welcomed continued Malaysian investment in Indonesia’s new Nusantara capital city (IKN), particularly in renewable energy and hydrogen development.

Both sides agreed to explore cross-border low-carbon energy trade between Peninsular Malaysia and Sumatra, including a direct interconnection to enhance regional integration.

The leaders also urged the swift convening of the Fourth Meeting of the Joint Trade and Investment Committee this year and called for expedited efforts to normalise trade at the Tebedu-Entikong border.

On the halal industry, Indonesia and Malaysia are committed to facilitating market access and regulatory alignment and aiming to strengthen Asean’s global halal competitiveness.

Acknowledging long-standing discussions since 2018, the leaders expressed hope that the MoU on counter-terrorism can be finalised and agreed to explore the technical aspects of transferring sentenced persons, pending relevant legal developments in Indonesia.

The leaders also reiterated commitments to protect Indonesian migrant workers and expand Indonesia’s Community Learning Centres (CLCs) in Malaysia in line with international commitments to children’s rights.

As co-founders of the Council of Palm Oil Producing Countries (CPOPC), Malaysia and Indonesia reaffirmed cooperation on sustainable palm oil as well as counter negative global campaigns targeting the commodity, the statement said.

Prime Minister Datuk Seri Anwar Ibrahim attends the 13th Annual Consultation with Indonesian President Prabowo Subianto at the Merdeka Palace July 29, 2025. — Bernama pic

Plantation Firms Train SPM SchoolLeavers Under Govt’s Foreign Labour Cut Drive

Agovernment drive to cut reliance on foreign labour is gaining ground, with plantation firms now training SPM school-leavers through targeted TVET programmes for modern estate work.

Plantation and Commodities Minister Datuk Seri Johari Abdul Ghani said the ministry had developed initiatives to strengthen TVET-based training through the Malaysian Plantation and Commodities Institute (Impac).

This includes the Farm Mechanisation Operations Course (KOML), “Harvesting Specialist” and “Machine Specialist” programmes, which have received encouraging interest from leading plantation companies.

He said the programmes, implemented using a “place and train” approach, aim to develop a highly skilled workforce in modern plantation operations, with a focus on productivity, safety and cost efficiency.

Among the companies forming strategic partnerships with Impac are SD Guthrie, FGV Plantation Bhd and Sarawak Plantation Bhd.

“Since 2024, more than 160 trainees have successfully undergone training and been placed at plantations owned by these companies, demonstrating the effectiveness of this initiative in meeting industry needs.

“Encouraged by the success of the initial rollout, several other major plantation firms, including Genting Plantations Bhd, Johor Plantation Group and Boustead Plantations Bhd, have shown early commitment to implement similar programmes.

“These programmes not only offer career assurance for trainees but also help companies build a skilled workforce tailored to actual on-the-ground needs,” he said in a written reply to the Dewan Rakyat yesterday. Plantation and Commodities Ministry

He was responding to a question from Mohd Isam Mohd Isa (BN–Tampin) on the industry’s reception of the new requirement to train SPM school-leavers through TVET, in an effort to reduce the country’s dependence on foreign labour.

Previously, the Plantation and Commodities Ministry had made it a precondition for industry players to hire TVET graduates in relevant fields before being allowed to employ foreign workers.

Johari said that to ensure training content matches operational realities, companies have also formed active collaborations with institutions such as the Malaysian Palm Oil Training Centre (Plasma), Kolej Yayasan Pahang and other TVET providers.

This collaborative effort aims to ensure that training modules genuinely meet the needs of modern plantations, which are increasingly grounded in technology and sustainable agricultural practices.

“In addition, the ministry has held engagement sessions with the Malaysian Palm Oil Association (MPOA) and the Malaysian Estate Owners’ Association (MEOA) to comprehensively examine critical issues such as job scopes and career progression prospects.

“These findings will serve as valuable input in formulating strategies to improve workforce planning, especially in efforts to attract and retain local workers on a long-term basis.”

India Buys 301,000 Tonnes of Malaysian Palm Oil in July, Highest in Nine Months

India’s palm oil imports from Malaysia surged 16 per cent in July 2025 to 301,000 tonnes, the highest in nine months.

This is even as Malaysia’s palm oil inventories climbed to a 19-month high of 2.11 million tonnes on slower pace of exports, according to Malaysian Palm Oil Council (MPOC).

Despite recent fluctuations to RM4,500 per tonne, MPOC expects crude palm oil prices to hold above RM4,300 in the near term.

“Tightening soybean oil export availability, combined with the prospect of slower palm oil supply growth relative to biodiesel demand should provide continued support.

“However, the sustainability of palm oil’s price strength will depend on its competitiveness against soybean oil in the export market,” it said in a statement.

MPOC said while domestic palm oil inventories have been increasing since February, supply pressures are still relatively contained.

It added that Indonesia’s biodiesel mandate has been steadily absorbing over one million tonnes of palm oil each month since February, which has helped avert a stockpile build-up there.

“The biofuel market has exerted a strong influence on the vegetable oil market in July and August.

“Rising US domestic feedstock requirements have pushed US soybean oil prices to a significant premium in August - US$131 per tonne above Argentine soybean oil and US$148 per tonne above Malaysian palm olein.

“The strength in US soybean oil prices has lifted the broader vegetable oils complex,” it added.

India’s palm oil imports from Malaysia surged 16 per cent in July 2025 to 301,000 tonnes, the highest in nine months. NSTP/ DANIAL SAAD

On the supply front, the council highlighted a shift in Malaysia’s production trend, with palm oil output in 2024 reaching its peak unusually early at 1.89 million tonnes in August, compared with the typical peak in October.

Peninsular Malaysia registered an exceptionally strong performance in July 2025, producing 1.12 million tonnes, the highest July output in a decade and also the region’s strongest monthly production in 10 years.

MPOC said this indicates production in Peninsular Malaysia may have already peaked in July, or could peak in August, before tapering off from September onwards.

“While Sabah and Sarawak have yet to reach their peak months, any downturn in Peninsular Malaysia from September is expected to cap national production growth for the rest of the year.

“As a result, Malaysia’s palm oil stocks are unlikely to see a major built-up in September and October,” MPOC said.

Rising Regulatory Risks May Force Planters to Scale Back in Indonesia

Rising regulatory risks in Indonesia could prompt some plantation companies to scale down or exit their operations over the longer term following a wave of large-scale land seizures. – Youtube

Rising regulatory risks in Indonesia could prompt some plantation companies to scale down or exit their operations over the longer term following a wave of large-scale land seizures, Public Investment Bank Bhd (PublicInvest) said in a recent note.

Last week, Indonesian authorities confiscated 394,547 hectares of plantation land spanning Central Kalimantan and Riau, as well as North and South Sumatra. The land, previously controlled by 232 companies, has been transferred to Agrinas, a state-owned company established in early 2025 under the administration of President Prabowo Subianto.

The operations were carried out jointly by the Ministry of Environment and Forestry, Ministry of Defence, and the Attorney General’s Office. The task force has set a target to reclaim up to three million hectares of plantations deemed illegally operating within forest areas by August.

With the latest seizures, Agrinas now controls approximately 833,000 hectares of plantation land, making it one of the largest plantation operators globally.

With this latest addition, the total plantation area under the Agrinas Group now stands at 833,000 hectares, making the company one of the largest plantation firms in the world.

Based on PublicInvest’s channel checks, several local plantation companies have surrendered a small portion of their plantation land to the Indonesian authorities.

“We understand that the impact on their earnings is largely muted. However, this development raises regulatory risks for industry players with significant exposure in Indonesia, which could weigh on their valuations over the long term,” it noted.

The firm also views this as a potential long-term environmental, social and governance risk.

Furthermore, PublicInvest said investment in replanting activities is expected to be more cautious, as it may compromise the companies’ interests.

The firm added that it is also concerned the military-led enforcement in plantations could exacerbate the declining trend in Indonesian palm production, as there are doubts over the state’s ability to manage these plantations effectively.

“Based on our rough forecast, if 50 per cent of the entire seized 833,000 hectares plantation remains unproductive, the annual palm oil production could decline by about four per cent or 1.7 million metric tonnes,” it said.

Meanwhile, PublicInvest said the recent surge in crude palm oil prices to over RM4,200 per metric tonne may reignite investor interest in plantation counters.

The firm has maintained a neutral outlook with a full-year crude palm oil price forecast of RM4,200 per metric tonne.

Indonesia Develops Bioethanol from Palm Oil Waste for Energy Swift

The Indonesian government is turning palm oil waste, specifically empty fruit bunches (EFB), into bioethanol through a glucose extraction process to accelerate the country’s energy transition.

Industry Minister Agus Gumiwang Kartasasmita said that collaboration is key to realizing environmentally friendly and sustainable technology.

“We need cross-sector synergy between the government and industry,” he said in a statement issued on Tuesday.

Andi Rizaldi, Head of the Industrial Services Standardization and Policy Agency (BSKJI), explained that this initiative is being carried out through a partnership between the Center for Standardization and Agro-Industrial Services (BBSPJIA) and private company PT Toyota Motor Manufacturing Indonesia (TMMIN).

Collaborators from PT Rekayasa Industri and the Bandung Institute of Technology (ITB), strategic partners of BBSPJIA in developing renewable energy technology, are also involved, he added.

“We are committed to supporting the development of standardization and industrial services that can drive the industrial sector toward gre ater competitiveness and environmental sustainability,” Rizaldi said.

He added that BBSPJIA plays a crucial role as a technical institution focused on converting agro-industrial waste into valuable products. Using its EFB Fractionation Pilot Plant, the agency can transform EFB waste into bioethanol, glucose, xylose, lignin, and other derivatives.

BBSPJIA head Yuni Herlina Harahap highlighted that the pilot plant serves as a research and development platform to support the industry in producing renewable energy from palm oil waste, which has long been underutilized.

“This project is expected to promote the development of sustainable palm oil-based bioenergy technology and open opportunities for further research collaborations aimed at using biomass as an environmentally friendly energy source,” she said.

All parties involved have agreed to explore collaboration opportunities that contribute to national technological advancement and strengthen Indonesia’s position in the global clean energy market.

TMMIN Vice President Bob Azam noted that bioethanol derived from palm oil waste is not only an alternative energy source but also part of a circular economy, helping to reduce environmental impact while increasing the added value of the palm oil industry.

“We appreciate BBSPJIA’s role as a research institution in providing real technological solutions and innovations to tackle future energy challenges,” he added.

File photo - Two workers harvest fresh fruit bunches (FFB) of oil palm in West Aceh, Aceh, May 1, 2025. (ANTARA/Syifa Yulinnas/ YU)

CO₂ Recycling Powers a New Palm Oil Alternative for The Cosmetics Industry

After many years of research, the Mibelle Group, LanzaTech and the Fraunhofer Institute for Interfacial Engineering and Biotechnology IGB have achieved a breakthrough in sustainable innovation: With the help of modern biotechnology, the partners have developed a CO2-based ingredient that can replace palm oil in cosmetics and other everyday products.

This pioneering technology not only reduces reliance on palm oil but also opens the door to more sustainable supply chains, with the potential to transform the industry at large. Palm oil is an indispensable raw material for many industries due to the high yield of oil palms, its long shelf life, and its heat resistance. From food, cosmetics, cleaning products to biofuels, palm oil is found in many of the products we use every day.

An Urgent Need for Palm Oil Alternatives

Ever larger areas of our rainforests are being cleared for palm oil cultivation, threatening many animal and plant species. This process also releases large amounts of stored CO2 into the atmosphere.

The cosmetics industry is aware of this situation and has responded by sourcing palm oil primarily from certified cultivation, ensuring that the raw material comes from sustainably managed sources. Yet, sustainable cultivation alone cannot meet the industry’s growing demand in the long term. New and innovative solutions are urgently needed for the future.

Innovative Technology in Action

The Mibelle Group is now pioneering a completely new approach together with LanzaTech and the Fraunhofer Institute for Interfacial Engineering and Biotechnology IGB. Their breakthrough combines two successive fermentation processes to convert the greenhouse gas CO2 into a palm oil-free fat blend. The composition of this mixture closely resembles palm oil in a manner that enables us to replace tropical oils in a wide range of future applications.

First, CO2 that would otherwise be released into the atmosphere is converted into alcohol using a biotechnological process developed by LanzaTech. This process is similar to brewing beer—except CO2 replaces grain as the raw material.

Two-stage biotechnological conversion of CO2 into palm oil-free fat. Credit: Fraunhofer IGB

In the second step of the fermentation process, developed primarily by Fraunhofer IGB, the alcohol produced from CO2 is transformed into the desired fats by specialized oil yeasts. Importantly, both fermentation stages rely exclusively on naturally occurring, non-genetically modified microorganisms.

The result is a versatile, high-quality fat that is 100% palm oilfree, natural, and enriched with outstanding skin care properties, an important feature for cosmetic products.

“This innovation is the result of our long-standing partnership with LanzaTech and a milestone for the cosmetics industry. Combined with the innovative strength of Fraunhofer IGB, we are setting new standards for the entire industry and underlining our commitment to taking responsibility for the future of our planet while making supply chains more robust,” says Peter Müller, CEO of the Mibelle Group.

From Prototype to Market Readiness

Following successful laboratory trials at Fraunhofer IGB and promising application tests in the Mibelle Group’s laboratories, the partners are now moving into a kilogram-scale production of the palm oil-like fat blend. To this end, the fermentation processes developed at Fraunhofer IGB are being scaled up stepby-step at the Fraunhofer Center for Chemical-Biotechnological Processes CBP in Leuna, a branch of Fraunhofer IGB.

“Following successful research in the laboratory, we have now

been able to start developing the pilot process,” says Susanne Heldmaier, Head of Research & Technical Innovation at the Mibelle Group. “This is an important next step, at the end of which we will have the first quantities of a high-quality fat.

“This will enable us to develop cosmetic products that not only protect our skin but also contribute to protecting the environment. In the future, with the support of our raw material suppliers, we hope to be able to convert more and more palm oil-based raw materials to this sustainable solution.”

With this new technology, the three companies are making a significant contribution to reducing rainforest deforestation in the long term and establishing a sustainable value chain.

Provided by Fraunhofer-Institut für Grenzflächen- und Bioverfahrenstechnik IGB

Palm Oil Unpacked: Separate Fact from Fiction on Cholesterol

Arecent national survey commissioned by Pertubuhan Transformasi Dayak, and conducted by independent research firm Green Zebras, found that 37 per cent of Malaysians believe palm oil causes high cholesterol.

This finding highlights a widespread misconception that deserves clarification through better public health communication and science-based education.

Palm oil is often misunderstood and wrongly assumed to contribute to high cholesterol and heart disease.

However, it is a plant-based oil and contains no dietary cholesterol. The assumption that it is harmful likely stems from outdated or oversimplified views on dietary fats.

What makes palm oil’s consumption so compelling is that research supports its nutritional benefits. A comprehensive review published in the United States’ National Library of Medicine in 2023 analysed 31 studies involving nearly 2,400 participants.

The findings showed that palm oil does not increase the risk of cardiovascular disease when compared to other commonly used vegetable oils such as soybean, olive, or sunflower oil.

The study also found no significant negative effects on cholesterol levels in healthy individuals.

Palm oil has a balanced fatty acid profile, with about 50 per cent saturated fat, 40 per cent monounsaturated (heart-healthy) fats and 10 per cent polyunsaturated fats.

This composition can help reduce LDL (bad) cholesterol. Moreover, palm oil is naturally trans-fat free and does not undergo the industrial hydrogenation process that may create trans fats in other oils.

Trans fats are typically produced by partially hydrogenating liquid vegetable oils to extend shelf life and change texture. This process alters the fat’s structure and introduces welldocumented health risks.

Palm oil, by contrast, is naturally semi-solid at room temperature and stable during high-heat cooking, eliminating the need for hydrogenation.

It is also important to recognise that high cholesterol is usually the result of a combination of factors. These include poor diet coupled with a lack of physical activity, smoking, stress, inadequate sleep, or genetics.

Singling out palm oil oversimplifies a complex issue and distracts from the more significant contributors to cardiovascular risk.

Palm oil is widely used in Malaysian households. It is locally produced, widely used, and economically important. It is also affordable and accessible to the majority of households. When used in moderation as part of a balanced diet, palm oil does not pose a health risk.

As we continue to encourage healthy lifestyles, we must also ensure that our public messaging reflects current scientific understanding. Outdated assumptions should not guide how we view food and health.

Instead, we must foster a more informed, balanced conversation around nutrition.

As a doctor, I urge Malaysians to shift the focus from blame to balance. We need to look at our overall lifestyle, including our diets, activity levels, stress, and habits, rather than placing the blame on a single ingredient.

When we ground our decisions in science instead of speculation, we make real progress in improving heart health.

It is equally important for policymakers, educators, and healthcare professionals to come together and strengthen public understanding.

Health advice must be based on evidence, not myths.

Sabah Leads in Sustainable Palm Oil with 97pct MSPO Certification

Around 97 per cent of oil palm plantation smallholders in Sabah have received Malaysian Sustainable Palm Oil (MSPO) certification, among the highest rates in the country.

Chief Minister Datuk Seri Hajiji Noor said as of April this year, the certification covers more than 30,000 smallholders and over 191,000ha of plantation land.

He stressed that amid global pressure for deforestation-free supply chains, advancing certification and traceability is vital for Malaysia to maintain credibility and recognition among key stakeholders.

“In Sabah, we are making progress, with about 97 per cent of the planted area and over 92 per cent in Sarawak certified under MSPO. However, we must push toward 100 per cent inclusion, particularly for independent smallholders,” he said at the East Malaysia Palm Oil Forum (EMPOF2025) here today.

His speech was delivered by State Industrial Development and Entrepreneurship Minister Datuk Phoong Jin Zhe.

Hajiji said the state government has adopted the Jurisdictional Approach for Sustainable Palm Oil (Jaspo), launched in 2015, with the goal of achieving 100 percent certified sustainable palm oil production statewide by 2030.

“Jaspo aligns Sabah’s ambitions with national and international standards such as MSPO, the Roundtable on Sustainable Palm Oil (RSPO), and the EU Deforestation Regulation (EUDR). It ensures that no stakeholder is left behind, especially smallholders, who account for over 27 percent of Sabah’s production,” he said.

Sabah currently has 1.48 million hectares under cultivation, with annual output exceeding 4.2 million metric tonnes of crude palm oil (CPO). Together with Sarawak, the two states account for more than 55 percent of Malaysia’s total oil palm planted

Phoong delivering the Chief Minister’s speech when officiating EMPOF2025.

areas, cementing the country’s position as the world’s secondlargest palm oil producer.

Hajiji noted that the industry supports the livelihoods of more than 300,000 Malaysians and over 85,000 smallholders nationwide, while also reshaping rural areas through infrastructure such as roads, schools, clinics and digital connectivity.

Meanwhile, Malaysian Palm Oil Council (MPOC) chief executive officer Belvinder Sron highlighted that Malaysia’s CPO production reached 19.3 million tonnes last year, with East Malaysia contributing 43.7 percent, or 8.4 million tonnes.

Within East Malaysia, Sabah led with 4.3 million tonnes or 22.1 percent of Malaysia’s total output, while Sarawak contributed 4.1 million tonnes or 21.6 percent.

However, Belvinder noted that production has stagnated since peaking at 19.9 million tonnes in 2017, due to shrinking mature areas, ageing trees, labour shortages and weather disruptions.

“Looking ahead, accelerating replanting is crucial. We need to raise replanting rates to four to five percent annually,” she said.

Bursa Malaysia Derivatives Berhad director Mohd Saleem Kader Bakas said EMPOF’s return reflects East Malaysia’s growing role in the palm oil sector.

“This underscores the sector’s importance to the state’s economy and its impact on rural livelihoods. Sabah continues to lead not only in production, but also in sustainability and conservation efforts,” he said.

Saleem added that Jaspo unites smallholders, mills, NGOs, buyers and local authorities to promote sustainability across the supply chain, citing conservation work such as biologist Farina Othman’s collaboration with farmers to protect Bornean elephants as proof that agriculture and conservation can coexist.

“Together, these initiatives reflect Sabah’s commitment to a more sustainable and inclusive palm oil industry,” he said.

He noted that Sabah has recorded over RM100 billion in annual trade over the past three years, with palm oil as a major contributor.

Microalgae Systems Transform Palm Oil Waste into Energy

In recent years, the pursuit of sustainable energy and waste management solutions has taken center stage in the face of climate change and environmental degradation. One innovative approach, integrating advanced biophotovoltaic systems using microalgae, has emerged as a promising avenue for harnessing renewable energy while simultaneously addressing waste treatment challenges. This fascinating approach utilizes palm oil mill effluent (POME) as a substrate for microalgae cultivation, thus aiming to generate electricity, purify biogas, and valorize bioproducts.

The significance of using palm oil mill effluent as a medium for microalgae-based systems cannot be understated. POME is a byproduct of palm oil production, and its disposal can pose severe environmental hazards due to its high organic content and the potential for contaminating water resources if not managed properly. By repurposing this waste material, the integrated biophotovoltaic systems not only offer a method for treating effluent but also pave the way for generating clean energy. This dual-functionality perfectly aligns with the principles of circular economy, wherein waste is transformed into valuable resources.

When it comes to bioenergy production, microalgae possess several advantages over traditional crops. They have rapid growth rates, require less land area, and can be cultivated in various environments, including wastewater. Microalgae also demonstrate impressive abilities to capture carbon dioxide while assimilating nutrients, making them essential players in mitigating greenhouse gas emissions. This remarkable capacity is enhanced when they are cultivated in a carefully designed biophotovoltaic setup, which effectively converts light energy into electricity through photosynthetic reactions.

The interplay between microalgae and bioelectrochemical systems is foundational for the functioning of biophotovoltaic systems. During photosynthesis, microalgae absorb light and convert it into chemical energy. This energy is subsequently integrated into an electrode, producing electric currents. This phenomenon not only serves as a clean energy source but also promotes the degradation of organic matter present in the effluent, thus enabling simultaneous wastewater treatment. Furthermore, this process can generate biogas, predominantly comprising methane, which can be used as a renewable energy source.

To assess the feasibility and efficiency of integrated microalgaebased biophotovoltaic systems, rigorous testing protocols and experimental designs are necessary. Researchers have employed various metrics to evaluate different strains of microalgae based on their growth rates, electron transfer capabilities, and overall productivity in POME environments. The synergistic interactions between microalgae and their unique biochemical properties play a pivotal role in harnessing energy from waste materials.

Bioproduct valorization is another compelling aspect of this research. As microalgae grow and metabolize nutrients from POME, they produce biomass that can be extracted and converted into high-value products such as biofuels, animal feeds, and cosmetics. This emerging bioproduct market is crucial for enhancing the economic viability of microalgae cultivation. Not only does it offer a reliable income stream for producers, but it also contributes to reducing the dependency on fossil fuels and non-renewable resources.

Several experimental setups have been devised to optimize the growth conditions of microalgae in biophotovoltaic systems. Factors such as light intensity, temperature, and nutrient availability are critical in maximizing the efficiency of electricity generation. Researchers are continuously exploring various combinations of these conditions to identify the most effective parameters for enhancing both energy production and wastewater treatment.

Moreover, this research contributes to developing scalable systems for broader applicability. While laboratory-based efforts may yield promising results, scaling up these biophotovoltaic systems for real-world applications poses its challenges. Addressing the techno-economic barriers associated with large-scale deployment requires interdisciplinary collaboration, involving experts in engineering, environmental science, and economics to build systems that are not only effective but also cost-efficient.

As we look to the future, the potential of microalgaebased biophotovoltaic systems expands beyond mere energy generation. These systems could facilitate a holistic approach to environmental sustainability by integrating energy production with waste treatment and bioproduct generation. Such innovations resonate with global sustainability goals, emphasizing the need for cleaner technologies and better resource management practices.

The implications of integrated microalgae-based systems stretch far and wide. They offer solutions to pressing environmental issues such as wastewater management and energy generation while simultaneously fostering economic development through the creation of new markets for bioproducts. Moreover, as we navigate the complexities of climate change and environmental degradation, innovative solutions like these can pave the way for a greener, more sustainable future.

Nevertheless, the journey toward widespread adoption of such technologies is complex and fraught with challenges. Government policies, public awareness, and scientific advancements are crucial for incentivizing the transition to these more sustainable systems. Continued investment in research and development will strengthen the capacity to overcome existing obstacles, pushing the boundaries of what can be achieved through biophotovoltaic technology.

In conclusion, the integration of microalgae-based biophotovoltaic systems utilizing palm oil mill effluent represents a revolutionary step toward achieving sustainable energy production and waste management. By harnessing the power of nature to generate electricity while treating waste, we unlock a new paradigm of ecological and economic benefits. As we move forward, it is vital that researchers continue to explore innovative applications of these systems, potentially transforming our approach to renewable energy and waste management on a global scale.

Ideal for dry blends for soil application

For isolated soil applications and supplemental auxiliary application Contact Weng Kee Ch'ng Regional Sales Manager/Agronomist, APAC +65 94592108 wengkee.ch’ng@riotinto.com https://agriculture.borax.com/oil-palm

Can be dissolved in water, liquid fertilizer, or pesticides then applied to soil or directly onto palms

Crinkled leaf

Immature palms

Parthenocarpy

Backed by Bill Gates, Singapore’s Terra Oleo Raises $3.1M to Turn Waste into Palm Oil Substitutes

Singaporean sustainable fats startup Terra Oleo has emerged from stealth with a $3.1M funding round and selection in Breakthrough Energy’s 2025 Fellows cohort.

Turning agro-industrial waste into sustainable alternatives to palm oil and cocoa butter, Singapore firm Terra Oleo has raised $3.1M in funding from ADB Ventures, The Radical Fund, Elev8. vc, Better Bite Ventures, and a “strategic corporate investor” from the palm oil industry, among others.

The startup has also been named in the 2025 Fellows programme by Bill Gates’s Breakthrough Energy. The initiative helps founders bridge the gap from lab to market and supports early-stage innovators with capital and mentorship. Fellows are

selected through a rigorous process to ensure their technologies can reduce emissions at scale, by at least five gigatonnes per year.

Terra Oleo – whose waste-valorising, precision-fermented fats cut emissions by up to 86%, land use by 90%, and water use by 88% – was selected to solve the climate, regulatory, and supply challenges facing palm oil and cocoa supply chains. The organisation’s backing will help it scale up production and advance customer formulation testing and validation.

“We are at lab-scale moving into pre-pilot scale. Several of our higher-value target ingredients are at price parity with their conventional equivalents,” co-founder and CEO Shen Ming Lee tells Green Queen.

Courtesy: Terra Oleo

Sustainable Fats from Starch, Biodiesel and Olechemical Waste

Lee, who founded Terra Oleo with Boon Uranukul and Min Hao Wong, grew up in the palm oil industry, with her family’s business among the world’s largest producers of the oil. So she firsthand knows the problems posed by its production.

The omnipresent fat is revered for its neutral flavour, smell and colour, and ability to withstand high temperatures and act as a natural preservative. But producing it is linked to mass tropical deforestation and wildlife and human rights abuses.

Indonesia and Malaysia alone are home to 90% of oil palm trees – the former’s forests have been subject to wildfires emanating directly from palm plantations in 2019. Palm oil production has increased tenfold since 1980, and as demand increases, more forests are set to be burnt down, a form of mass deforestation that emits greenhouse gases, while removing trees that would help absorb them.

Climate change is disrupting the cocoa industry too. Global stocks of the crop have slumped to their lowest in a decade.

Plantations in the Ivory Coast and Ghana, the two largest producers, are the hardest hit due to extreme weather and crop diseases. That has caused cocoa prices to reach all-time highs.

Terra Oleo is betting on waste and fermentation to decarbonise these two industries. Its precision fermentation process modifies yeast into lipids with customisable profiles for high-value palm and cocoa applications, and eschews the energy-intensive refining steps and toxic byproducts of oleochemical processes.

“Our defensible tech edge lies in deep expertise in microbial strain engineering, which enables our yeast to directly produce application-ready specifications of high-value palm oil derivatives (specialty oleochemicals) and cocoa butter equivalents,” said Lee.

“In parallel, we employ synthetic biology innovations to enhance process economics, from efficiently utilising lowcost agro-industrial waste streams to reducing downstream processing costs,” she added. “We source cost-effective waste streams from starch, biodiesel, and oleochemical production, which are abundant across Southeast Asia.”

Courtesy: Terra Oleo

Terra Oleo Is Already Testing Palm and Cocoa Fat Substitutes with Companies

Terra Oleo’s process overcomes the limits of natural microbes, delivering superior unit economics and faster market adoption than other solutions. “We’ve built strain capabilities across three yeast species,” Lee said, without disclosing the specifics.

At full scale, its technology is predicted to remove 900 million tonnes of CO2 from the palm and cocoa supply chains annually, affecting products across the personal care, cosmetics, pharmaceutical and food industries.

“We are manufacturing in Thailand and Singapore across all target products. We are product testing with several global and regional leaders in oleochemicals, food, personal care, and cosmetics. Product validation is underway,” said Lee.

“We will use the funds to scale from lab to pilot and advance formulation testing and validation with key customers,” she said of the capital raise.

Ashley Gross, VP of Breakthrough Energy, added: “We’re honoured to have the opportunity to work with talented founders who are tackling the most difficult climate and energy challenges around the world.”

Terra Oleo’s raise comes amid rapid advancements in the sustainable fats sector. This month, British firm Clean Food Group received regulatory approval in the US, EU and UK to sell its yeast-derived oil in cosmetic applications, and Estonia’s Äio completed a one-tonne production run for its palm oil substitute, eyeing market entry by year-end.

And yesterday, Dutch producer NoPalm Ingredients signed a deal with dairy giant Milcobel to use its whey permeate as a fermentation feedstock for its palm oil alternatives. It will also explore the feasibility of co-locating its first commercial-scale factory at the latter’s site in Langemark.

Courtesy: Terra Oleo

In Malaysia’s Palm Oil Heartland, Smallholders are Redefining What it Means to Grow Responsibly

As the palm oil industry evolves, Malaysia’s smallholders are helping shape a more sustainable future, grounded in collaboration and community.

On Carey Island, Malaysia, the sun shines down on rows of oil palm trees across a 21-acre farm. Here, Reta Lajah and her husband tend to their land—gathering fallen fruits and pruning trees—and enjoy peaceful weekends with the company of their children and grandchildren.

Lajah is one of 450,000 smallholders who have become vital contributors to an industry long dominated by large corporations since oil palm farming first took root in Malaysia in 1917. Today, that landscape has evolved, with smallholders accounting for 26% of the country’s palm oil supply, providing a stable livelihood for many rural families.

Land of Opportunity

Lajah’s journey as a palm oil farmer began when she was just 17 years old, working on the largest plantation in her hometown. A member of the Mah Meri—one of Peninsular Malaysia’s 18 indigenous groups—she received her own plot of land in the

early 2000s through a government program. But the path wasn’t easy. “We cleared and planted everything,” she recalls. “No machines, just our hands and tools. It was very hard work.”

As smallholder farming gradually spread in her village, the community began to diversify beyond its traditional reliance on fishing—an industry that, as Lajah points out, can be unstable during certain seasons. The shift opened up new income opportunities and a more stable livelihood for many families.

Still, across Malaysia, women remain significantly underrepresented, making up 20% to 25% of the country’s palm oil plantation workforce. In Lajah’s village, she is just one of two female farm owners. She believes more women could step into this space with the right training, support, and access to knowledge.

A Long Road to Reform

In past decades, palm oil expansion was associated with forest loss, but following successful campaigns for change and targeted reform efforts, that trend has been reversing in Malaysia. Between 2012 and 2024, deforestation in Malaysia dropped

by over 70%—a decline driven by strengthened government regulations, voluntary corporate commitments—including No Deforestation, No Peat, No Exploitation (NDPE) policies— sustainability reporting, and increased industry transparency.

Central to this progress is the Malaysian Sustainable Palm Oil (MSPO) certification, a national scheme introduced in 2013 to raise standards and promote more responsible practices. Now mandatory, MSPO certification covers environmental protection, labor rights, and the ability to trace the palm oil product to a sustainable source. For smallholders like Lajah, it also unlocks access to global markets by demonstrating a commitment to sustainability.

Malaysian palm oil is also one of the world’s largest producers of Certified Sustainable Palm Oil (CSPO), with steady growth in the number of smallholders and production areas independently audited and meeting the internationally recognized standard. In Sabah, the local government launched an initiative a decade ago to support oil palm growers in pursuing CSPO certification, with the aim of aligning local production with international standards and improving access to global markets.

Rooted In Responsibility

While Malaysia’s sustainability push has reshaped its palm oil industry, smallholders—who often operate with limited land and resources—still face challenges, from price fluctuations to the complexity of meeting evolving standards.

To support them, the government has introduced additional programs beyond certification. Initiatives like ITa (Integrated Short-Term Crops) and ITe (Integrated Livestock) encourage farmers to diversify their output, making their income more resilient and improving land use. More recently, national efforts have focused on strengthening traceability and preparing smallholders for upcoming international regulations such as the EU Deforestation Regulation.

At the grassroots level, organizations like Wild Asia play a crucial role in empowering smallholders. Working directly with farmers, they help embed sustainability into everyday practice— reducing chemical use, promoting safer waste disposal, and introducing intercropping with fruits and vegetables—to improve soil health, attract biodiversity, and create additional income streams.

“We found that almost consistently their yields are the same or even slightly better,” says Wild Asia founder and executive director Reza Azmi. “You also see more worms in the soil. You hear more birds. The air feels fresher.” For Azmi, sustainability isn’t just a compliance checklist.

Palm oil plays a significant role in Malaysia’s economy, contributing almost 3% of the national GDP. And as stewards of the land, independent farmers are uniquely positioned to lead positive change, one farm at a time. Having benefited from support herself in the past, Lajah now hopes to share her experience and help others, especially women, step into the field—ensuring that the next generation of farmers are better equipped and part of a more sustainable future.

MPOB and Earthworm Foundation Renew Partnership to Strengthen Smallholder Sustainability

Collaboration to support oil palm farmers in productivity, income diversification, and environmental stewardship from 2025 to 2028

The Malaysian Palm Oil Board (MPOB) and the Earthworm Foundation have renewed their strategic partnership for another three years, reaffirming their shared commitment to advancing sustainable practices among Malaysia’s oil palm smallholders. The new Memorandum of Agreement (MOA), signed at Rumah Adat, Kampung Orang Asli Sungai Mok, will guide collaboration from 2025 to 2028.

Since its inception in 2021, the MPOB–Earthworm initiative has provided tangible benefits for smallholder communities. Nearly 4,000 farmers have received training and on-site

guidance to boost productivity while adopting environmentally sound practices. Over 1,000 smallholders have registered for the Malaysian Sustainable Palm Oil (MSPO) certification, and around 100 have diversified their income through ventures such as mushroom, melon, bird’s nest, and chilli cultivation. These efforts not only strengthen household earnings but also enhance resilience against market fluctuations.

The programme has also connected smallholders to financial aid, created market access opportunities, and supported the adoption of safety and health standards in plantations, including proper chemical handling and the use of protective equipment. Community-led initiatives, such as the Sg. Mok Orang Asli Cooperative, have further united local farmers while promoting integrated farming models and sustainable land use.

Rosdi bin Mahdi, Chairman of Koperasi Orang Asli Sg. Mok, gifted a handwoven mat to MPOB Director-General Datuk Dr Ahmad Parveez Hj Ghulam Kadir, symbolising community partnership.

MPOB Director-General Datuk Dr Ahmad Parveez Hj Ghulam Kadir delivered the opening address at the MPOB–Earthworm Foundation MOA exchange ceremony.

MPOB Director-General Datuk Dr Ahmad Parveez Hj Ghulam Kadir engaged in discussions with Earthworm Foundation’s Malaysia Country Representative Kiah Hui Ooi and OPAC during the Palm Oil Clinic for Smallholders.

“This renewed partnership reflects MPOB’s commitment to ensure that smallholders are equipped with the knowledge, tools, and innovations needed to thrive in an evolving market while upholding sustainability,” said Datuk Dr Ahmad Parveez Hj Ghulam Kadir, Director-General of MPOB.

Echoing this, Ooi Kiah-Hui, Malaysia Country Representative of Earthworm Foundation, said:

“This journey with MPOB and the smallholder community demonstrates how partnerships can enable farmers to improve their livelihoods while protecting the environment. The dedication of the smallholders themselves is at the heart of this success.”

The MOA signing was held alongside the Oil Palm Agronomy Centre (OPAC) Oil Palm Clinic, where smallholders took part in soil analysis, crop management workshops, and training to improve Fresh Fruit Bunch (FFB) quality. A guided site visit highlighted sustainable farming practices already in place under the cooperative.

The next three years of this collaboration aim to deepen support for smallholders by strengthening resilience, increasing productivity, diversifying incomes, and embedding sustainability at the core of Malaysia’s palm oil sector.

Innovative Power Transmission Solutions Driving Efficiency and Sustainability in the Oil Palm Industry

Tang

Mun Kit

Mr. Tang has been with the Sumitomo Group since 2005 and brings extensive experience across Engineering, Service, Gearbox Product Management, and Business Development.

Over the years, he has visited numerous palm oil mills, group headquarters, and OEMs across Malaysia, Indonesia and Thailand to better understand their operational needs and product improvement requests.

With these valuable insights, Mr. Tang has collaborated closely with the factory R&D team to introduce additional product ranges and options in recent years-which have been well received by leading palm oil groups.

Q1. Sumitomo has been a key player in power transmission globally. How do your products and services specifically support the oil palm industry?

Absolutely. Sumitomo has been involved in the palm oil industry since the 1980s. We set up assembly plants across ASEAN back in 1995, and since then, we’ve kept expanding— both our product range and our network. For example, we introduced the Paramax YHD series, designed specifically for palm oil applications. On top of that, we’re the only brand with direct warehouses and service workshops in places like Sampit and Medan. This means our customers don’t just buy a product—they get fast, on-the-ground support whenever they need it.

Q2. Palm oil milling can be tough, with heavy loads, vibration, and harsh conditions. How do Sumitomo gear solutions handle these challenges?

We design our gearboxes to survive that environment—strong housings to withstand vibration, long-life bearings that last as long as the equipment itself. But what really sets us apart is our KAIZEN approach—continuous improvement. Let me give you an example: a few years back, one of our YHD070 gearboxes developed a housing crack at a mill. When we checked, it turned out the foundation had sunk and thrown the coupling out of alignment. Technically, not a product fault. But instead of leaving it there, we redesigned the housing mould to make it even stronger—so no other customer would face that risk again. That’s our way of making sure customers get peace of mind.

Q3. Industry 4.0 and automation are reshaping industries. How is Sumitomo integrating smart technologies into palm oil mills?

We’re already seeing this transformation taking place. With rising manpower costs, automation is no longer a choice—it’s becoming a necessity. At Sumitomo, we collaborated with YKL Engineering to pioneer automation solutions for kernel crushing plants and machinery, powered by our Sumitomo Invertek technology. We’re excited to showcase this enhanced innovation at the upcoming PIPOC, Booth No. 264 & 265, from 18th–20th November 2025, and we invite you to come explore it with us.

Q4. Efficiency is everything in palm oil production. How do your products help mills cut downtime and boost productivity?

You’re right—downtime is the biggest enemy in a mill. If a gearbox fails and there’s no spare, it could take weeks to get a replacement in remote locations. That’s why we build gearboxes and gearmotors to last. And to back that up, we’ve strategically placed warehouses in Sabah, Medan, and Sampit, so we can deliver faster than anyone else. At the end of the day, we don’t just sell products—we help mills keep running without costly interruptions.

Q5. Sustainability is now a big focus. How do Sumitomo’s solutions support energyefficient and eco-friendly operations?

That’s true—sustainability is no longer a buzzword, it’s a real requirement. For years, mills generated their own electricity, so efficiency wasn’t always top-of-mind. But things are changing. More mills now see the benefits of our high-efficiency SM motors, especially standalone kernel mills that can actually reduce their power bills with them.

Q6. The industry faces environmental scrutiny. How does Sumitomo help mills operate greener?

This is close to our heart. In fact, in 2023 we launched the Digester Drywell Series—a gearbox that uses up to 65% less lubrication oil per change. Not only does this cut waste and cost, but its leak-free design eliminates the risk of MOSH/MOAH contamination in digesters.

We also see a lot of waste when gearboxes fail prematurely. We’ve replaced countless units from other brands that gave up after just 1–2 years, sometimes even months, because of poor design or undersizing. Every replacement adds cost and increases carbon footprint—new production, scrap processing, logistics. A gearbox should be designed to last, and that’s what we stand for.

Q7. Advanced technology can sound expensive. How do you balance innovation with affordability, especially for smaller mills?

That’s a fair point. Palm oil is one of the most cost-sensitive industries, but also one of our largest markets—with product optimisation & big production volume, our prices are very competitive.

The difference is in the quality. We use premium gear materials and bearings, and every single unit is 100% tested before it leaves the factory. Many others only test a sample. So yes, you might pay a little more upfront compared to cheaper alternatives, but if a cheaper gearbox fails early, the downtime and replacement costs quickly outweigh the savings. It’s really about long-term value.

Q8. Finally, where do you see Sumitomo’s role in the palm oil industry going forward?

We see ourselves as more than a gearbox supplier—we’re a long-term partner to the palm oil industry. Our role is to keep innovating, whether it’s improving reliability, making operations more sustainable, or helping mills embrace Industry 4.0.

At the end of the day, we want mills to run smoother, greener, and more profitably—not just today, but for decades to come. That’s the future we’re working toward, together with our customers.

Overcoming the 3 Big Challenges in Palm Oil Process Instrumentation

The palm oil industry in Malaysia and Indonesia stands as a global powerhouse, not only contributing significantly to national GDP but also shaping global supply chains in food, energy, and consumer goods. Yet, the industry is plagued by three persistent challenges that producers grapple with every day.

First, the wear and tear of equipment caused by the harsh process environment leads to frequent breakdowns and reduced lifetimes. Second, the settling and clogging of impurities in processing lines leads to unpleasant surprises, higher maintenance needs, and costly replacements. Finally, these factors combine to drive up both CAPEX and OPEX costs, putting pressure on margins in an already competitive market

Palm oil producers are always looking for ways to upgrade their installations. With margins under constant pressure, every drop counts. Here instrumentation plays a critical role. As the

old saying goes, “you can’t manage what you cannot measure”. Not just accurate instrumentation is important, but also reliable instrumentation. Optimize production, extend lifetime, reduce maintenance and thus lowering CAPEX and OPEX expenditure.

This is where KROHNE brings unique value and brings advanced instrumentation to the table. Unique instrumentation that provides solutions to the 3 big challenges. We help palm oil mills and refineries tackle these pressing issues head-on.

Wear and Tear

Crude palm oil is a tricky medium to work with as it is highly abrasive and can quickly damage instrumentation that is critical to the operation of your plant. It is essential to factor in this property as the wrong choice of instrumentation can result in premature failures, costly downtime, and higher maintenance.

Typical weak spots in a bent tube Coriolis mass flowmeter compared to reduced wear and tear with a straight tube Coriolis mass flowmeter.

Coriolis mass flowmeters and pressure transmitters tend to be the most influenced by this. Classical double-bent tube mass flowmeters are highly vulnerable in abrasive applications because the bends in the inner tube and the flow splitter are prone to wear. In severe cases, this can even lead to leakage. To avoid this one could lower the velocity, but this will lead to plant inefficiency.

KROHNE addresses this with the OPTIMASS 7400, a single straight-tube Coriolis mass flowmeter proven and tested in the most extreme conditions. By eliminating bends and a single tube design, it avoids the abrasion issues over traditional bent tube designs. Optionally this mass flowmeter could be foreseen with titanium material, prolonging the lifetime even more. A solution we bring over from the pulp and paper industry to the palm oil industry.

The second area of concern is pressure measurement. Pressure transmitters are widely used not only for direct pressure measurement but also for DP-level applications. Conventional piezoresistive membrane transmitters wear out rapidly in abrasive processes. Instead, try working with ceramic pressure transmitters, the OPTIBAR PC 5060. A technology often overlooked by palm oil producers. Ceramics is one of the hardest materials known to man, harder than diamond and is exceptionally resistant to abrasion. Beyond the robustness, ceramic pressure transmitters bring other advantages forth. As it does not have any filling fluids, it’s less temperature dependent and and increases response time. A DP-configuration is

also possible, by spanning an electrical cable between two transmitters in a master-slave setup, called electronic differential pressure, or eDP in short.

Electronic differential pressure measurement (eDP) and pressure transmitter with flush-mounted, ceramic diaphragm.

Settling of Impurities

A headache for every engineer. Settling of impurities is a common issue in the palm oil industry, mainly in applications such as crude oils and miscella. These impurities have the tendency to settle and clog up instrumentation. This results in frequent maintenance and cleaning in order to avoid false signals. Again, bent tube massflowmeters and pressure transmitters are prone to this.

for convenient handling with secured

Flow always tends to select the path of least resistance and so in a double bent tube mass flowmeters one of the tubes might get stuck, especially during an unexpected temperature drop or in low flow rates. With single straight tube there is no second pathway and ‘siphon effect’. Which will eliminate the risk of clogging and ensure operation.

When it comes to hydrostatic pressure transmitters, it pays to think outside the box. An alternative technology worth considering is FMCW radar level measurement. Unlike hydrostatics, FMCW radars are completely contactless with the medium, eliminating the risk of build-up or wear. However, FMCW Radars have received a bad reputation in the past due to the old 24 GHz radars horn antennas. Palm oil’s inherently low reflectivity, combined with the presence of vapours, often disturbed the radar signal and led to unreliable measurements. Today this issue is resolved with the new 80 GHz variants such as the OPTIWAVE 15XX series and 7500. 80 GHz poses a narrower beam angle of up to 4º and increased reflection rates, making them suitable to palm oil processes.

When it comes to cost, prices have dropped significantly in the past few years. The very first FMCW radars in 1989 could cost as much as a small car, but today you can buy an 80 GHz for a similar price as a mid-end hydrostatic pressure transmitter. The OPTIWAVE 15XX series is a good example of this. Small and

compact, while highly economical and boasts an 80 GHz signal, it is ideal for small palm oil storage tanks where previously hydrostatic pressure transmitters would be installed. Equipped with Bluetooth technology, its interface is user-friendly, making it easy for operators to configure and to monitor using the OPTICHECK Level Mobile app.

OPTISWITCH 6X00 series – Capacitance level switches for standard and advanced hygienic applications in tanks detects foam and degree of water contamination.

OPTIWAVE 15XX series – Compact radar level transmitters

Bluetooth connection.

Time to talk about the elephant in the room when it comes to settling of impurities, which are tuning forks. A level switch must be reliable, particularly since it is often applied in safetycritical operations. Impurities in oils tend to build-up over time and cause false signals causing the need for the operator frequently clean the tuning fork which is a labour intensive task. In certain cases, such as when gums are present, tuning forks may fail to function altogether.

Capacitance level switches, such as the OPTISWITCH 6X00 series, offer a viable alternative. Unlike tuning forks, which only provide point detection, these switches measure signal intensity, allowing them to distinguish between build-up and actual product. In short, you have a working level switch that operates under high-build-up applications. Furthermore, the switch can also detect interface and foams. They are fully programmable, enabling the user to select the desired detection state via the configuration tool. And lastly, pricing is similar to a normal tuning fork, making them a cost-effective solution.

Summary

Palm oil producers face continuous challenges such as equipment wear and tear and the settling of impurities, which increase downtime, maintenance needs, and replacement costs. These issues directly impact reliability and efficiency, driving up both OPEX and CAPEX.

The correct instrumentation ensures not only accurate measurement, but minimizes failure risks, and optimizes performance under abrasive and high-impurity conditions.

There’s only so much we can cover in a 2-page article. Are you interested in learning more? Please contact KROHNE Malaysia for more information.

Radar level measurement of vegetable oil in storage tanks.

IBG Biofertilizer Series Is Malaysia’s First Biofertilizer That Has Been Certified as Eco-Friendly Product Under SIRIM ECO

013:2024.

IBG biofertilizer has been an important elements to promoting soil rehabilitation and agriculture production yield. As the Malaysia’s first biofertilizer to be certified as an eco-friendly product under the SIRIM ECO 013:2024 certification in year 2025, the IBG biofertilizer series represents a breakthrough achievement that places Malaysia at the forefront of ecoinnovation in agricultural inputs. Developed through years of collaborative research between local universities and industry partners, IBG biofertilizer integrates beneficial microorganisms with organic substrates to enhance nutrient availability while protecting soil ecosystems. Its certification under the new SIRIM ECO013:2024 standard confirms that the product meets stringent criteria for biodegradability, low toxicity, and sustainable production processes.

SIRIM ECO 013:2024 is a rigorous eco-labelling standard designed to ensure that products meet specific environmental criteria before they are certified. The standard takes into account factors such as raw material sourcing, production processes, product safety, and long-term environmental impact. For IBG biofertilizer to be awarded this certification, the product had to undergo stringent assessments and independent verifications to prove that the product minimizes ecological harm. By meeting these requirements, IBG biofertilizer has successfully

set a benchmark in Malaysia, demonstrating that agricultural inputs can be developed in a way that balances productivity with sustainability. This is particularly crucial at a time when chemical fertilizers, while effective, are being increasingly scrutinized for their negative consequences on soil degradation, water pollution, and carbon emissions.

At the same time, IBG biofertilizer has obtain MyHijau mark. The MyHijau mark is Malaysia’s official green recognition scheme, endorsed by the Government through the Malaysian Green Technology and Climate Change Corporation (MGTC). Carrying the mark signals that IBG biofertilizer is an authentic, certified green product that meets strict local and international environmental standards. Carrying the MyHijau mark provides IBG with a unique branding edge, positioning it ahead of competitors who lack eco-certification. It strengthens the company’s sustainability profile, especially in industries like oil palm and rice cultivation where international buyers demand proof of sustainable practices. By being part of the MyHijau ecosystem, IBG biofertilizer supports Malaysia’s green economy agenda and commitments under climate agreements. This enhances IBG’s reputation not just as a product manufacturer, but as a contributor to Malaysia’s sustainable development.

Moreover, in recent research collaboration with Xiamen University Malaysia, IBG biofertilizer manufacturing process has been proved to emit up to 99% less emissions than organic fertilizers & 95% less than nitrogen fertilizers in the research paper “Biofertilizers for sustainable agriculture: A life cycle assessment of upstream manufacturing to carbon reduction”. Whilst in paddy field, the research paper “Toward carbon mitigation resiliency in the agriculture sector: An integrated LCA-GHG protocol-IPCC guidelines framework for biofertilizer application in paddy field” showed that the use of IBG biofertilizer helped lower greenhouse gas emissions by about 15% per hectare, mainly by improving how soil stores carbon and reducing the need for chemical fertilizers. If this method is used across the country by 2030, it could reduce greenhouse gas emissions from agriculture by about 10%, which is roughly 2% of Malaysia’s total emissions. That’s the same as planting over 580,000 mangrove trees.

Looking ahead, the IBG biofertilizer series’ certification as Malaysia’s first eco-friendly biofertilizer under SIRIM ECO 013:2024 is a groundbreaking achievement with far-reaching implications. It represents a scientific, environmental, and economic advancement that highlights Malaysia’s capability

to innovate and lead in sustainable agriculture. By meeting rigorous eco-labelling standards, IBG biofertilizer has demonstrated that it is possible to achieve high agricultural productivity while preserving the environment and mitigating climate change. Its certification paves the way for greater adoption of eco-friendly inputs, enhances Malaysia’s global competitiveness, and contributes directly to national and international sustainability goals. Most importantly, it sets a new benchmark for the agricultural sector, inspiring farmers, industries, and policymakers to work collectively toward a greener, more resilient, and more sustainable future.

IBG Manufacturing Sdn. Bhd. extends its invitation to all the interested personnel/party to visit their factory at the address below:

No. 3 Jalan TPP 3, Taman Perindustrian Putra, 47130 Puchong, Selangor Darul Ehsan

Tel. no. 03 – 80662875.

Email: info@ibgbiofert.com.my.

References

Mulya, K. S., Tan, J. P., Yeat, S. P., Yeat, C. N. C., & Woon, K. S. (2024). Biofertilizers for sustainable agriculture: A life cycle assessment of upstream manufacturing to carbon reduction. Chemical Engineering Transactions, 113, 187–192. https://doi. org/10.3303/CET24113032

Mulya, K. S., Tan, J. P., Siaw Ping Yeat, Ning, C., Aitazaz Ahsan Farooque, Zhou, S., & Woon, K. S. (2025). Toward carbon mitigation resiliency in the agriculture sector: An integrated LCA-GHG protocol-IPCC guidelines framework for biofertilizer application in paddy field. Journal of Environmental Management, 389, 126005–126005. https://doi.org/10.1016/j. jenvman.2025.126005

How China Can Help Rewrite the Future of Indonesian Palm Oil

Indonesian President Prabowo Subianto has launched a campaign against illegal palm oil plantations, seeking to reclaim millions of hectares of forest lost to unchecked expansion.

The authorities confirm that plantations on 3.7 million hectares are illegal, and more are under review. In Riau, the heart of Indonesia’s palm oil economy, the government has begun dismantling plantations in Tesso Nilo National Park and relocating families who have long lived within its shrinking forest boundaries.

Palm oil is often treated as a commodity, yet it is also a mirror of civilisation. Each hectare of forest cleared for palm oil erases wildlife and ecosystem services, and destroys the memory written into the land. Despite this, economic tables reduce the story to export and growth figures. Numbers present development, but behind them lies an arrangement where prosperity is bought at the expense of destruction.

Indonesia’s plantations cannot be understood in isolation from global demand. Each tree felled is linked to the appetite of markets abroad.

The nation supplies palm oil to India, China, the United States, Pakistan and Bangladesh, among others. Demand from these destinations fuels expansion. But when the European Union’s Deforestation Regulation is adopted, Indonesian suppliers, whether conglomerates or smallholders, will have to prove they are not linked to deforestation.

China sits at the centre of this unfolding story. In 2024, it absorbed around 15 per cent of Indonesia’s palm oil exports, which are mostly used for food processing and producing consumer goods. About three-quarters of China’s palm oil imports come from Indonesia, binding the two economies together. The scale of this relationship means China’s decisions carry influence far beyond commerce, shaping not only trade but also forests and futures.

Europe and the United States lead in certified sustainable palm oil imports, driven by strong regulations. This creates a divided market where sustainable imports flow mostly west. China is closing the gap by rapidly advancing its sustainability efforts and increasing certified sourcing, but true global sustainability requires broader cooperation to prevent uneven environmental impacts and destructive practices.

China’s choice carries consequences both economic and civilisational. Responsible sourcing would pressure Indonesian producers to raise standards, while reliance on cheap, unregulated oil would entrench illegality. The scale of China’s demand effectively determines the future of Indonesia’s forests. Shared responsibility and trust are the answer.

If responsibility is chosen, the first requirement is deforestationfree sourcing. This cannot be reduced to compliance paperwork. Traceability systems can support accountability, but real change comes when buyers reject the illusion of cheapness without cost. When integrity becomes essential, palm oil is transformed from a neutral commodity into a covenant. It becomes an agreement between grower and buyer.

China’s market strength makes this transformation possible. By rewarding responsible producers with long-term contracts and stable prices, it can turn sustainability into opportunity. Even small adjustments, scaled across its vast purchasing power, could shift industry behaviour.

Centuries ago, China built the Silk Road to connect civilisations. Today it has the chance to create a “Green Road”, where trade is woven not from erasure, but from justice and stewardship.

Dialogue will also matter. Indonesia worries that sustainability rules may conceal protectionist intent. Cooperation can ease this suspicion. Joint forums could harmonise standards, improve enforcement and build transparency. Such collaboration would do more than enforce compliance. It would signal a pact between two nations prepared to defend the living planet together through sustainable and responsible palm oil production.

Finance is another powerful tool. Chinese banks already fund firms in the palm oil supply chain. Redirecting these flows into sustainable projects would accelerate reform. Loans could prioritise replanting degraded land or developing traceability systems. Guarantees could reduce risks faced by smallholders. When financial resources are linked to responsibility, capital itself becomes a moral force. Investment decisions then shape not just economies but landscapes, communities and the meaning of progress.

Change must also reach households. Many Chinese consumers remain unaware of the presence of palm oil in their lives, from mooncakes to instant noodles. Surveys suggest younger buyers are open to sustainable choices. If their purchases become acts of conscious participation, daily consumption could evolve into forest stewardship. Every basket of food or soap could be a statement of shared responsibility for life.

Indonesia would gain deeply from such a transformation. Without markets that demand integrity, Prabowo’s crackdown risks losing strength. With China’s partnership, illegal plantations would lose profits while enforcement would gain power. Certified producers would thrive, rural villages would stabilise and forests would endure.

The future of palm oil would move beyond simple economics. It would mark a reconciliation between growth and guardianship, between ambition and care of the environment.

Indonesia Pushes for South-South Cooperation on Palm Oil Sustainability Standards

In July, Indonesian Deputy Foreign Minister Arif Havas Oegroseno announced a new push to develop palm oil standards through Global South cooperation organisations – specifically the BRICS (Brazil, Russia, India, China, South Africa and others), CPAPC (the Council of Palm Oil Producing Countries) and the UN’s Food and Agriculture Organisation (FAO).

It comes as the EU’s recently passed Deforestation Regulation (EUDR), which has been delayed and is currently scheduled to take effect at the end of 2025, is coming under intense criticism from countries in the Global South.

Speaking at the Bioenergy Industry Opportunities and Challenges Seminar in Jakarta on 17 July, the deputy foreign minister said the initiative is designed to prioritise the needs of developing nations and smallholder farmers. “The European Union has created its own standards without any alternative benchmark,” he said. “So, we must create our own benchmark outside the EU. We need to establish national or international standards under platforms like CPOPC, BRICS, and FAO.”

[Getty Images: somnuk krobkum]

Several BRICS countries have so far responded favourably to the idea, and there is already a consensus to create sustainable vegetable oil standards that acknowledge the challenges faced by developing nations.

Arif Havas told the conference that the new plan marks a “strategic shift - Indonesia will no longer just react to global rules, it will take the lead in shaping them.”

He said that rules designed by jurisdictions in which the commodities impacted (palm oil, cocoa, rubber and coffee) are not grown are not taking into account the sustainability actions taken by governments in producing countries.

Government Actions Unveiled

Indonesia and Malaysia, the world’s two largest palm oil producers, have rolled out a number of public policies to make their palm oil industries more sustainable. Both governments are relying on mandatory certification schemes and stronger environmental safeguards. The results so far have been mixed.

Jakarta made its Indonesian Sustainable Palm Oil (ISPO) scheme compulsory through a 2020 Presidential Regulation, requiring all growers, including smallholders, to be certified by 2025. The standard covers legal compliance, environmental protection and labour rights. The government also introduced peatland restoration programs and, until 2021, maintained a moratorium on new oil palm permits. After the moratorium lapsed, officials insisted that existing regulations were sufficient to control deforestation and land-use change.

As of 2024, about 35–36 per cent of Indonesia’s plantation area was ISPO-certified, with independent smallholders struggling to meet the costs and technical demands. Watchdogs have warned of gaps in peat protection and enforcement.

Deforestation, which had fallen steadily since the mid-2010s, ticked up again in 2023-2024. Analysts say renewed expansion pressures and inconsistent enforcement risk undermining hardwon environmental gains.

Mandatory Certification

Malaysia has also passed a number of new laws to improve the sustainability of palm oil. Its Malaysian Sustainable Palm Oil (MSPO) certification became mandatory in 2020, and the government unveiled MSPO 2.0 in 2022, introducing tougher requirements on deforestation cut-offs, labour conditions, and traceability.

The new standard officially took effect on 1 January 2025. Authorities backed the transition with funding and outreach campaigns. By the end of 2024, around 86 per cent of plantations were certified, with officials targeting more than 95 per cent coverage in 2025. The results are visible. Primary forest loss in Malaysia declined by 13 per cent in 2024 compared to the previous year, according to World Resources Institute data, pushing the country out of the global top-10 for tropical forest loss.

“Malaysia has put in place policy frameworks and legislation to ensure sustainable development of the industry,” says Dr. Ahmad Parveez Ghulam Kadir, Director-General of the Malaysian Palm Oil Board. “The development of the oil palm industry is governed by more than 60 regulations and laws, making it one of the most regulated industries in Malaysia. More importantly, Malaysia has prohibited the opening of new land areas for oil palm cultivation.”

Both countries have complained that the EUDR, which requires palm oil imports to be deforestation-free, doesn’t recognise these efforts. Jakarta and Kuala Lumpur have joined a joint task force with the EU aimed at aligning certification, traceability and legality standards.

Commission Defending EUDR

In a letter sent to the European Parliament before the legislature voted in December to delay the implementation of the law, a group of NGOs warned that if the EU doesn’t stand by its law in the face of global pressure, forests will be put at risk.

“The world’s forests urgently need the protection that the EUDR offers. Following years of failures by the private sector to voluntarily address environmental and human rights impacts in their supply chains, the EUDR is a necessary and crucial step. By delaying its application and giving in to the demands of vested interests, the European Commission is significantly undermining the EU’s credibility as a global leader in the fight against climate change, biodiversity loss and human rights violations,” they warned.

The centre-right European People’s Party of European Commission President Ursula von der Leyen has led the efforts to delay and adjust the EUDR. However, so far, the Commission is standing behind the legislation.

In April, the Commission released simplification guidelines “replying to feedback from the EU’s international partners.” It came with a Delegated Act that would clarify the scope of the new rules, along with a country benchmarking system. But they say they are standing behind the law.

The Commission noted that, “Together, all these measures will lead to a currently estimated 30% reduction of administrative costs and burden for companies. This will ensure a simple, fair and cost-efficient implementation of this key piece of legislation. The EUDR has already led to positive developments and action on the ground to fight deforestation, climate change and biodiversity loss.”

But the international partners producing these products may move ahead with their own standards. The Indonesian government has said that laws targeting deforestation should recognise both sustainability imperatives and development realities, and that environmental protection efforts done incorrectly could inadvertently harm the very communities they aim to protect.

Not All Types of Palms Are Created Equal

Oil palm is such an important edible oil tree crop for the world.

We all know oil palm is called “sawit” in Malaysia and Indonesia, but ever wondered where this punchy little word came from?

What’s In a Name?

Fuelled by curiosity, I dove into some etymological sleuthing.

The results? As rich and tangled as a fruit bunch – thorny, colourful and full of surprises.

One theory traces sawit to the Javanese phrase “sak wit”, meaning one tree trunk. A fitting nod to the palm’s upright stance.

Folklore even tells of a majestic tree that towered over a village in Indonesia, inspiring its name – Sawit. Now that’s a name with deep roots!

Then comes another twist from the Indonesian dictionary: “sawitan”, referring to matching outfits.

Could this reflect the oil palm fruits’ synchronised ripening – either in their reddish-nigrescens charm or the virescent variety’s orange glow? Fashionable indeed.

Now here’s the poetic angle: in old Javanese, sawit can mean “necklace” or “thread”. Imagine it – oil palm as a strand connecting lives and livelihoods across generations, draped like a legacy over the shoulders of South-East Asia.

But wait – Tagalog brings in a wild card. Sawit there means “non-stop chatter” (yes, verbal diarrhoea!). Apt for a crop that fuels heated talk: costs, taxes, trade wars, EU Deforestation Regulation, sustainability – you name it, sawit stirs the pot.

And just when you think the word has run dry, along come the acronyms. SAWiT or South Asian Women in Tech, or South African Wine Industry Trust.

From palm oil to IT and wine, this word truly spans the globe.

A Spiky Connection: Oil Palm Versus Snake Fruit

Did you know oil palm is called Kelapa Bali in Indonesia? Don’t ask me why –even Google throws up its hands. But here’s a fun twist: in Bahasa Sunda, it’s affectionately known as salak minyak.

Just don’t confuse it with salah minyak (wrong oil), because in this case, the name fits beautifully.

Why? Just look at an oil palm fresh fruit bunch. Spiky, reddish, tightly packed – basically a snake fruit (salak) that hit the gym and bulked up into an agri-industrial powerhouse.

Add minyak (oil), and boom! You’ve got the perfect metaphor for this tropical titan.

Now, salak isn’t just some cute name. It means “silver” in Sundanese, a nod to its shimmering, scaly skin.

Like oil palm, snake fruit hides value beneath armour – both are nature’s barbed treasures.

So when we talk about Malaysia’s plantation sector, what’s the right label? My vote: oil palm industry.

Salak, native to Indonesia and Malaysia, is a close cousin in the palm family. Its snake-like skin grabs your attention, but inside? Sweet, tangy flesh that’s both refreshing and a little astringent, depending on the variety. But beware the hard seeds – crunch at your own risk.

The parallels with oil palm are uncanny: both are spiky, misunderstood and brimming with utility.

Oil palm powers global food and industry; salak satisfies with its exotic, natural sweetness. Calling oil palm salak minyak isn’t just poetic – it’s a tribute to palm family resilience.

But salak’s legacy isn’t just botanical – it’s also geographic.

In Malaysia, the name crops up in Salak Tinggi, Salak South, Kampung Salak, even the Salak Expressway. It’s practically a postcode celebrity.

Beyond Malaysia? Mount Salak looms in West Java.

There’s a Salak town in North Sumatra, a Salak village in Iran, and even one in northern Cameroon. Who knew this prickly fruit would plant its name across continents?

So next time you see a sawit bunch or a snake fruit, pause. Beneath the spikes lie stories of strength, sweetness, and an unexpected global journey.

Kelapa Sawit: A Town with Ghosts

Did you know there’s a town in Johor called Kelapa Sawit?

Tucked along the Jalan Kulai–Air Hitam Road, this quiet “pekan” traces its roots to the 1950s Malayan Emergency, when Chinese villagers were relocated into New Villages.

Today, it’s a Hakka cultural gem, where time slows down and Singaporeans flock in on weekends for rustic charm and food trails.

But not all is calm beneath the sawit canopy.

Back in the 1990s, I heard of planters’ whisper about the town’s police station – dubbed one of Malaysia’s most haunted lockups. Whether they were pranking me or not, the tales were chilling. Detainees, they claimed, were tormented by eerie presences, with some so scared they wet themselves.

Ghosts from the Emergency or World War II? Who knows. But the haunted reputation stuck. Honestly, this place could outshine escape rooms – imagine a “One Night Behind Bars” ghost-tourism dare. Eat your heart out, Ghostbusters!

The sawit name pops up everywhere – Bukit Sawit, Sawit Seberang and across kampungs and plantations in South-East Asia. It’s more than just oil palm; it’s folklore, economy and identity rolled into one prickly package.

Oil Palm or Palm Oil?

Here’s a confession that might ruffle a few journalistic feathers: I get twitchy when people mix up oil palm industry with palm oil industry. Yes, I know – it sounds nitpicky. But trust me, the difference matters.

The oil palm industry refers to the upstream side – plantations, planters, smallholders and estate work.

It’s where the real toil happens, from seed to fruit bunches. The palm oil industry kicks in downstream – refineries, oleochemicals, packagers – the glossier, processed side of the chain.

Palm oil mills? They’re the midstream bridge, turning fruit bunches into crude palm oil. Not quite upstream, not quite downstream. Somewhere in between with an identity crisis.

So when we talk about Malaysia’s plantation sector, what’s the right label? My vote: oil palm industry. That’s where the ecosystem begins. It powers everything else.

Without upstream, there’s no golden oil downstream.

Now for pet peeve number two: misidentified oil palm trees in the media. You’re reading a story about oil palms and – bam! – a date palm photo appears.

It’s like writing about elephants and showing a mammoth. What’s next? Koala piece with a kangaroo pic?

And artificial intelligence (AI)? Don’t get me started. Some generated “oil palm estate” images look like tropical Minecraft – bizarre fruit clusters, sci-fi trees and pristine fields straight out of an 1980s arcade game. Real estates are muddy, sweaty and full of heart. We don’t float on sleek drones – we slog through rain and blazing sun.

Why This Matters

Here’s a quick botany refresher. The palm family (Arecaceae) has 2,600 species. But only Elaeis guineensis — the African oil palm – is the high-yielding, oil-churning, tropical superstar that fuels the global edible oil market.

Date palms and coconut trees? Beautiful, but not in the same productivity league.

Media missteps – wrong photos, wrong terms – may seem small, but they shape perception. If we want people to understand oil palm, we need accuracy in language and visuals. It’s time for more media familiarisation, some Oil Palm 101, and also better AI prompts.

So, next time you spot a date palm masquerading in an oil palm article, know this: someone’s palms got crossed.

Let’s honour the industry by getting it right – because palm oil products don’t just grow on trees. They grow livelihoods and they deserve to be seen clearly and respectfully.

Joseph Tek Choon Yee has over 30 years’ experience in the plantation industry, with a strong background in oil palm research and development, C-suite leadership and industry advocacy. The views expressed here are the writer’s own.

Insight: Old Trees and Ageing Farmers Worsen Outlook for Top Palm Oil Exporters

Exports from the world’s top two producing countries are set to fall further on replanting delays, rising local demand because of higher biodiesel blending mandates

Malaysian farmer Suratmen Mosman faces a dilemma that threatens to sap supply from the world’s top palm oil exporters and drive-up prices of the vegetable oil essential to billions of consumers worldwide in the next five years.

The ageing trees on his plantation 300 km (185 miles) south of Kuala Lumpur are bearing less fruit, but the 85-year-old is holding off replacing them as he doesn’t want to lose income while waiting the three to five years it takes for new trees to start yielding a crop and the years beyond that it will take for them to reach peak production. Government subsidies to encourage replanting are not as high as they once were and he needs to support his family.

Used mostly as a cooking oil, but also to make cakes, cosmetics and cleaning products, palm oil makes up more than half of the world’s vegetable oil supply and 85% of the crude product comes from Malaysia and Indonesia.

But after decades of soaring output, the market is now at a tipping point as combined exports from the two producers are set to slow sharply, the result of stagnating production and efforts by Indonesia to divert more palm oil into the production of biodiesel.

While financial markets have factored in the slowdown, there is growing evidence that plantations run by smallholders like Suratmen may be in worse condition than previously thought as ageing and lower-yielding trees are not replaced, which will add to the decline. Smallholders make up 40% of the plantations across Malaysia and Indonesia, so they play a vital role in the supply chain.

Supplies to global markets from Indonesia and Malaysia could fall as much as 20% over the next five years, according to Reuters’ calculations based on government and industry projections, some previously unpublished.

Future output from smallholders may well be over-estimated because the condition of trees and the rate of planting new trees is worse than estimates by the governments in Kuala Lumpur and Jakarta, according to veteran industry figures Dorab Mistry and M.R. Chandran.

That view is backed up by Reuters interviews with more than a dozen farmers and officials in Malaysia.

And other previously unpublished data shows the acreage of plantations where trees are older than 20 years - a point at which they are considered beyond their peak - is growing fast.

Mistry, a director of Indian consumer goods firm Godrej International and a long-term palm oil analyst who has been in the industry for more than 40 years, and Chandran, the former head of the Malaysian Palm Oil Association, estimated that more than half of the trees on Malaysian smallholder plantations are well past peak production.

The estimate is significantly higher than Malaysian government data, which shows 37% of smallholder plantations are past their peak yielding phase.

“Palm oil supplies are getting tighter,” said Mistry, who bases his estimate on site visits to plantations, data analysis, and engagement with producers, traders, and other key industry players.

“This is not just a problem in Malaysia but also in Indonesia. Though Indonesia’s industry is younger, it will face the same problems in the next five years,” he said.

In Indonesia, just 10% of a 2016 government target to replant 2.5 million hectares (9,653 square miles) by 2025 had been met as of last October, publicly available government data showed.

As a result, over one-third of oil palms among both smallholders and industrial plantations are either at or past their most productive years. Acreage for trees older than 21 years is set to rise 11% next year in Indonesia, according to previously unreleased data from state research firm Riset Perkebunan Nusantara (RPN).

Reluctance in Malaysia and Indonesia to replace old trees, plus Indonesia’s increased biodiesel mandates, point to a sharp drop in palm oil exports in the coming five years.

Calculations based on Malaysian and Indonesia palm oil body estimates suggest combined exports are likely to drop to about 37 million metric tons by 2030, down by a fifth since 2024.

Indonesia is likely to have around 20 million tons available for export, down by nearly a third from last year, according to forecasts from RPN and the Indonesia Palm Oil Association (GAPKI).

There are no official forecasts for Malaysian palm exports by 2030, but Mistry said expectations are now that they will remain steady or decline slightly, reflecting a lack of consistent replanting and in contrast to earlier estimates of modest annual increases.

Indonesia’s Ministry of Agriculture did not respond to requests for comment on the estimates for output and exports to drop.

State-run industry regulator the Malaysian Palm Oil Board said it did not agree with the assessment that over 50% of smallholders’ oil palm trees are beyond peak yielding age.

“According to MPOB’s 2024 data, only 36.2% of smallholders’ oil palm trees are over 18 years old, and many smallholders have already begun replanting with government support,” the board said in a response to questions from Reuters.

To ease replanting costs, the government offers a 50% grant and 50% loan, it added.

“The government values smallholders’ contributions and continues to refine support schemes based on ongoing feedback to ensure long-term sustainability and inclusivity,” it said.

Demand Rising

Industry projections indicate global demand will rise by 50 million tons by 2050, requiring minimum annual supply growth of 2%, Chandran said. However, he estimates production is on track to grow at just 1.5% annually, he said, based on ageing trees and slow replanting rates in both countries.

The contrast to palm’s earlier growth is stark. Palm doubled its share of the global vegetable oils market to 30.6% in the three decades to 1995, with Indonesian production growing an annual 8.1% and Malaysian output rising 3% over the same period.

“There will be growing tensions between rising global demand and the challenge of expanding production sustainably,” said Chandran, who is also chairman of IRGA, an agritech firm specialising in data analysis and field research.

Already, strained palm oil supplies are pushing up costs for alternatives including soybean, rapeseed and sunflower oil.

Last year, crude palm oil traded at a $39/ton premium to soybean oil compared to a $160 discount in 2023, according to the Malaysian Palm Oil Board.

Top buyer India’s annual palm oil imports are set to drop below other edible oils for the first time this year as rising palm costs push refiners toward alternatives.

An oil palm farmer walks through a plantation in Pontian, Malaysia April 24, 2025. REUTERS/Hasnoor Hussain

Reluctant Replanters

Interviews with 11 small-scale Malaysian farmers found most were reluctant to replant as mature trees are their main income source amid two-year high prices.

“I did not replant my trees as I do not have any other sources of income,” Suratmen said, standing among his five acres of oil palms in Johor state’s Pontian district.

Some of his newer trees were planted on unstable peatland and lean at angles.

“My replanting efforts are limited to replacing fallen trees or planting new ones in between existing trees,” he said.

Most smallholders converted rubber plantations to palm in the early 1990s and 2000s, so their trees have now reached the 25year mark and are due for replanting, said National Association of Smallholders Malaysia president Adzmi Hassan.

The challenge is compounded by mostly ageing landowners, many of whose children have moved to cities, leaving planters without the labour or physical capacity to replant.

“You have to consider the plantation cost, the work to replant, and there are many independent smallholders who do not want to be tied down to a bank debt,” said Mohd Sharul Haizam Shafei, 42, who owns 50 acres of plantation in Banting.

In Malaysia, the replanting rate averaged about 2% over the past five years, half the government’s 4% target, according to Malaysian Palm Oil Board data.

Replanting Costs Deter Farmers

While the Malaysian government provides a grant for half of replanting expenses, many smallholders are unwilling to take on debt to cover the rest, said Adzmi from the smallholders’ association.

He is lobbying the government to fully subsidise replanting, as it did before 2019, but that is seen as unlikely as the government is cutting subsidies elsewhere, including for fuel.

Indonesia last year doubled replanting funding for smallholders, but Gulat Manurung, chairman of planters’ group APKASINDO, said farmers struggle to access the funds due to land legality issues and complicated terms.

With ageing trees, fresh fruit bunch yields for smallholders in Indonesia last year averaged 9.6 tons per hectare, Indonesia Palm Oil Board data showed, less than half the yields produced at larger state-owned and private plantations.

The industry is in a bind to boost output as Malaysia caps total planted area while Indonesia, under pressure from the European Union and environmental groups, has a moratorium on new forest clearing for palm plantations.

Suratmen, the farmer in Pontian, said without a full subsidy, he’s not replanting.

“Waiting for new trees to mature and produce fruit takes too long. We cannot support our families during those years without income from the trees,” he said.

Suratmen Mosmon, an 85-year-old oil palm planter, stands at his plantation in Pontian, Malaysia April 24, 2025. REUTERS/Hasnoor Hussain

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