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Malaysia Allocated RM 10 Million to Develop Traceability Application in Palm Oil Industries

Doc. of NST/General Director of MPOB, Datuk Ahmad Parveez Ghulam Kadir.
Malaysia Allocated RM 10 Million to Develop Traceability Application in Palm Oil Industries

InfoSAWIT, KUALA LUMPUR – Ministry of Plantation and Commodity Malaysia did a big leap heading to sustainability by delivering investment almost RM 10 million to develop traceability system in palm oil supply chain industries.

The system would monitor every supply chain for 500 thousand smallholders in the country, to confirm that Malaysia would qualify the close regulation in European Union which is European Union Deforestation Regulation.

The new system that would be launched by Prime Minister of Malaysia, Datuk Seri Anwar Ibrahim on 8 November 2023 is about to support (palm oil industries) particularly the smallholders and planters in the country. prior, many smallholders could not consistently and accurately record (their activity). Without having accurate data, it would be difficult to effectively deliver counseling about smallholders’ plantation production in association with costs and profits.

General Director of Malaysian Palm Oil Board (MPOB), Datuk Ahmad Parveez Ghulam Kadir said that the system would record fresh fruit bunch (FFB) transaction from smallholders that need traders as hub, but also would involve every supply chain, starting from the planters to the industries, mills, dealers, and personal smallholders in every production phase to be traded carefully and in detail.

One big challenge is about to confirm the obedience in the latest sustainable certification in the country – Malaysian Sustainable Palm Oil (MSPO) that covers the terms and conditions in European Union Deforestation Regulation (EUDR). These demand every actor in palm oil production to prove that they were not contributing in deforestation or forest degradation. To qualify the conditions, Malaysian Palm Oil Board (MPOB) started to map agricultural locations carefully where the smallholders cultivate. This would confirm traceability of product and be the solution of obedience in safe cost.

Ahmad Parveez also emphasized that this is important knowing that Malaysia is facing risks in palm oil trade with European Union. By delivering detail that the products from high risk - countries should surpass due diligence up to nine percent; while the products from low risk – countries need to get one percent – due diligence. He told that this is about to confirm that Malaysia is in low risk – country - category.

In facing complexity in palm oil industries that involve thousand planters and hundred thousand of smallholders, the proactive things are not easy tasks. Having limited staffs but about 250 thousand smallholders, this work would be full of challenge.

“But this is important to confirm that every smallholder is not left behind in palm oil trade landscape change,” he said as quoted from Business Time.

What MPOB is doing would also involve to map agricultural location carefully where the smallholders are cultivating. This initiative would help not only to qualify the conditions in EUDR but offer solution of obedience in safe costs.

“Failure to qualify EUDR would endanger palm oil trade to European Union. These proactive actions would be very important,” he said. (T2)