JAKARTA – Indonesia and Malaysia have established a synergy to push up the trading value of palm oil. The synergy is realized through the signing of a memorandum of understanding (MoU) on the purchase of palm sludge oil (PSO, a type of palm oil waste) by Malaysia at the volume of 2,000 tons per month during the next two years.
The trade ministry’s (Kemendag) National Export Development Director General Kasan said that through the synergy both countries will continue pursuing the palm oil diplomacy at the global market. It is particularly important as the palm oil commodity has been continually facing negative campaigns at the international market, especially in Europe.
“By signing the MoU, both companies will establish a synergy to increase the trading value of palm oil between the two countries. We’ll keep pursuing the palm oil diplomacy, promoting the palm oil commodity at global market, and countering all negative campaigns against the palm oil,” said Kasan in a press release on the MoU signing between PT Alam Duta Mandiri and Dendro Integrasi SDN Bhd recently.
The agreement was signed by Chief Executive Officer of PT Alam Duta Mandiri, I G A Raka Saputra and Chief Executive Officer of Dendro Integrasi Sdn Bhd, Azra Abdul and was witnessed by National Export Development Director General Kasan and Malaysian Ambassador to Indonesia Datuk Zainal Abidin Bakar.
“We hope that the signing will encourage other Indonesian companies to supply the palm sludge oil to Malaysia and the palm oil products and derivatives to other markets across the globe,” he said.
He pointed out that in 2020, the Indonesian exports of palm oil products and derivatives to Malaysia reached US$945.03 million, which was an increase of 15.11 percent compared to US$820.97 million at the previous year.
In ASEAN region, Indonesia is the biggest exporter of palm oil products to Malaysia with a market share of 85.14 percent, followed by Thailand at 8.56 percent, Cambodia at 1.78 percent, the Philippines at 1.48 percent, and Singapore at 0.61 percent.
“Indonesia’s export of palm acid oil/palm sludge oil to the global market in 2020 reached a total US$544.47 million or an increase of 6.60 percent compared to that at the previous year,” said Kasan.
He noted that Malaysia is the main destination of Indonesian export of palm sludge oil at the total value of US$185.37 million or a market share of 34.05 percent, followed by Italy at US$101.12 million (18.57 percent), China US$76.93 million (14.13 percent), Netherlands US$41.61 million (7.64 percent), and the USA US$27.20 million (5.0 percent).
He further said that Indonesian production of palm oil in 2020 was still above the average of annual production, despite being impacted by the Covid-19 pandemic.
Based on data from the oil palm plantations fund management board (BPDPKS), in 2020 Indonesia’s palm oil production reached 51.58 million tons, which was higher than the average of annual production at 37.57 million tons.
The realized export volume of Indonesia in 2020 reached 34 million metric tons or a decrease of 9.0 percent compared to that in 2019. “But its palm oil export value increased by 13.6 percent to US$22.97 billion. It was because the palm oil products and derivatives saw a steady increase of prices during 2020,” said Kasan.
He asserted that during the last two decades the palm oil industry had played a very significant role in the national economy of Indonesia.
The palm oil has a very high versatility, as it can be processed into various kinds of products of foods and oleochemicals. In addition to that, its palm sludge oil can be also used as the raw material to feed the industries of energy, cosmetics, and other consumer goods like soaps and shampoo.
“It is undeniable that the palm oil has become an important alternative of renewable energy sources as it can be used to produce biodiesel. The biodiesel is an important alternative in the future, not only for Indonesia, but also for countries across the globe. It is cheap and environmentally friendly,” said Kasan.
Source: InfoPublik/wartaekonomi.co.id
