Oil palm, not coconut, the best crop for Malaysia, says minister

Primary Industries Minister Teresa Kok says the oil palm industry has performed admirably over the years, ‘salvaging our economy many times’.

KUALA LUMPUR: Primary Industries Minister Teresa Kok disagrees with Daim Zainuddin’s statement that there is no future for palm oil.

However, she agrees with the government adviser that coconut cultivation shows great potential.

In a statement today, she said that her ministry would continue to promote the palm oil industry while also paying attention to reviving coconut cultivation.

“The future is in coconuts, and not palm oil,” Daim had said at a conference organised by the Asian Strategy and Leadership Institute, entitled “Poverty in Malaysia: Reality vs Perception”.

The former finance minister added there would be a future in palm oil only if more research was done, especially in “turning it into, let us say, more food”.

Kok said there was “a good reason” why palm oil was still the best agri-commodity for Malaysia. The industry, she said, contributed 4.5% to the gross domestic product (GDP) and RM67.5 billion or 52.8% of export earnings to the country in 2018.

She said the oil palm industry had performed admirably over the years, “salvaging our economy many times over”.

“Today, I agree that the nation’s smallholders are stressed due to lower returns from their small plots of land and we need to take corrective action quickly.

“Historically, the original smallholders, especially those provided land under several schemes, such as Felda and Felcra, tended to their crops on their own or with their immediate family’s assistance.

“Any income generated, less input, was theirs to keep and this elevated their living standards tremendously.

“The nation simultaneously witnessed many sons and daughters of these smallholders graduating from local and foreign universities to take up key positions in all walks of our Malaysian life.

“As many among the original smallholders have aged, their children are less inclined to tend their land. They have effectively become absentee landlords, leasing their lands to others.

“This also means that the income generated is split between parties and less is received by the smallholders themselves.”

She said the ministry was addressing the problems faced by smallholders.

“Tun Daim has rightly pointed out that the future for palm oil hinges upon creating more food demand, through diversification of applications and new product innovations.

“Curiously, experts in the oils and fats fraternity tell us that new product innovations, with any oil or fat, is actually becoming more far and wide. Regular inter-oil substitution is highly possible.”

Kok said an ever-growing global population would ensure continued demand for oils and fats for food consumption, adding that palm oil was the most cost-effective oil.

“It is hard to imagine a scenario wherein it can be replaced by other oils, including coconut, for its pricing, functionality and versatility. We simply need to pay greater attention to our current cultivation and processing practices.

“For smallholders, replanting with higher oil-yielding varieties is a better choice forward.

“My ministry has been encouraging smallholders to practise inter-cropping with other crops that fetch high prices. These could include pineapples, coconuts, vegetables, as well as animal husbandry to diversify their income sources.

“This way, they won’t be so affected when the palm oil price is low.”

Saying coconut cultivation along coastal areas had been neglected, Kok added: “In agreeing partially with Tun Daim, I would like to propose coconut cultivation in such areas be revitalised using high-yielding short dwarf coconut palms.”

She noted that the palm oil industry also produced palm kernel oil. “This, for all purposes, duplicates the functionality of coconut oil and is highly in demand.

“Should Malaysia venture into a targeted coconut oil cultivation programme, I can assure you that it will also be welcomed by our palm oleochemical industries.”

Kok added that the bottom line to these suggestions was that both crops could boost the income of smallholders and the economy.

“It could simply be a question of maximising our land use patterns. I see no reason to aggressively switch away from oil palm cultivation. The demand for the oil is quite assured.”  - FMT