Yang Berbahagia Datuk Dr. Ahmad Parveez Hj. Ghulam Kadir

Director General of MPOB

Yang Berusaha Dr. Ramle Moslim 

Deputy Director General (Research and Development) of MPOB

Yang Berusaha Puan Ruba’ah Masri 

Deputy Director General (Services) of MPOB

MPOB Board Members,

Distinguished PAC Members, 

MPOB Senior Management, 

Ladies and Gentlemen,

Assalamualaikum W.B.T., Salam Sejahtera, Salam Malaysia MADANI and a very good morning.

It gives me great pleasure to welcome all of you to the Programme Advisory Committee (PAC) 2025 meeting. It is truly an honour to join eminent scientists and industry experts in the oils and fats sector from around the globe. I appreciate your effort to be together in this meeting for us to discuss and deliberate in this scientific gathering. 

2. Malaysian Palm Oil Board (MPOB) always regarded the PAC meeting as an important platform for a focused discussion on Research and Development (R&D) initiatives that can benefit the palm oil industry. The inputs from members of this meeting have given MPOB truly invaluable insights on R&D and innovation in driving our efforts to strengthen the competitiveness of the oil palm industry. Thus, your contribution to this meeting will be very significant.   

Ladies and Gentlemen,

3. 2024 was a challenging year. Globally, we are facing an increase in cost that has inflated palm oil prices. The disruption of supply chains and lack of demand due to conflict in the Middle East and in Ukraine has affected the supply chain, leading to higher freight rates and longer delivery times. Thankfully, the Malaysian palm oil industry seems to be resilient and with palm oil positioned to complement other vegetable oils, the palm oil sector continues to drive the country’s economic growth.

4. The Government’s efforts and initiatives implemented last year included the funding of RM 100 million in the Oil Palm Replanting Financing Incentive for Independent Oil Palm Smallholders 2.0 (TSPKS 2.0) which further strengthened the independent smallholders covering 5,900 hectares of smallholders’ oil palm area. The Government has also proposed an increased threshold on windfall profit levy for palm oil producers. This is to ensure that palm oil producers can absorb the rising production cost and to plan long term investment towards replanting old oil palm trees. 
   
   
5. CPO prices were traded higher in 2024, increased significantly to an average of RM4,179.50 per tonne as compared to RM3,809.50 per tonne in 2023. The higher CPO price had boosted the export revenue by 15.2% to RM109.39 billion as against RM94.95 billion recorded in 2023. The higher CPO price in 2024 continued its upward trend in the fourth quarter of 2024. On 6th December 2024, the CPO price was traded at RM5,333.50, the highest price ever recorded in 2024.

6. The Malaysian Government through the Ministry of Plantation and Commodities supported by other ministries and agencies including MPOB, as well as industry players are working hard to ensure that the oil palm industry continues to be a powerhouse of the oils and fats market. In this regard, we need to generate fresh ideas to move the industry towards a better future. This PAC Meeting is one of the platforms whereby such ideas, innovations and solutions can be nurtured to enhance MPOB’s R&D endeavours and serve the needs of our oil palm industry.
   
   
7. In the PAC 2025 Meeting, the R&D structure has been enhanced with the inclusion of a new Focus Area: Techno & Socio-Economics (TSE). This addition reflects MPOB’s commitment to addressing broader economic and social dimensions in the development of the oil palm industry, complementing its existing technical and scientific research. Prior to this, MPOB’s R&D was anchored on five existing Focus Areas, namely:

1. Yield Performance (YP)
2. Climate Change Mitigation and Adaptation (SD)
3. Milling, Processing & Mechanisation (MA)
4. Food Safety and Nutrition (FN)
5. Value Addition (VA)

The inclusion of TSE expands the scope of research to also encompass Economic Development and Social Development, ensuring a more holistic and inclusive approach in supporting the industry’s sustainable growth.

Ladies and Gentlemen,

8. One of the critical areas that PAC Members need to address during the deliberations is the industry’s concerns on yield improvements. Although the production of palm oil has increased over the years, the yield has remained stagnant. By December 2024, around 9.3% or 520,067 hectares of Malaysia’s oil palm trees were over 25 years old. It is high time we implemented advanced biotechnological, breeding and cloning tools that will enable the development of high yielding materials, one of which will deliver improved disease resistance, higher oil quality traits, resilient to climate change and most importantly, increased yield. We also need to adopt the best agronomic practices to further increase efficiency and productivity. 
   
   
9. To prove our commitment to addressing the effects of climate change on oil palm plantation, I would also like to call the attention of PAC Members to look into these issues very seriously and help the industry find practical solutions to reconcile differences between the industry and the critics. Various issues and concerns have been raised concerning land-use change, biodiversity and conservation efforts, deforestation, as well as pollution of water and air. The livelihood of smallholders is impacted by increasing new or stringent regulations and certifications on sustainability, Good Agricultural Practices (GAP), thus making them less able to meet the demand of the industry and economically less competitive. I hope the PAC Members will take the opportunity at this meeting to assess a well-balanced approach to fulfil the sustainability requirement for the oil palm industry. 
   
   
10. The Malaysian oil palm industry is committed to producing sustainable palm oil following the principles and criteria set by the Malaysian Sustainable Palm Oil (MSPO) Certification which was made mandatory from 1st January 2020. As of end December 2024, around 662,737 hectares of oil palm owned by independent smallholders have been successfully certified with MSPO, while 590,152 hectares of oil palm owned by organised smallholders (smallholders that are managed by agencies such as FELDA, FELCRA, RISDA, and state agencies) were certified with MSPO.
    
    
11. Whilst palm oil producers continue to contend with 3-monochloropropane-1,2-diol esters (3-MCPDE) and glycidyl esters (GE) for more than 15 years albeit the availability of proven technologies to resolve the presence of 3-MCPDE and GE, another food safety concern related to mineral oil hydrocarbons, in the form of mineral oil saturated hydrocarbons (MOSH) and mineral oil aromatic hydrocarbons (MOAH), is now under the radar. Health implications of MOSH and MOAH in food products are debatable until today. In June 2012, the European Food Safety Authority (EFSA) has issued a report on the potential risks of MOSH and MOAH. However, in September 2023, EFSA had released a new statement which indicates that MOSH is no longer a concern to human health. 
    
    
12. Despite, the EU has yet to officially mandate the maximum limits for MOAH, some of the member countries have taken proactive measure to monitor the level of MOAH in edible oils and fats. To date, Malaysia has experienced three incidences of palm oil consignments rejection from entering two European countries. As majority of palm oil is used in food production, there is an urgent need of combating the prevalence of mineral oil hydrocarbons at the palm oil value chains particularly at the palm oil processing premises.

Ladies and Gentlemen,

13. The Government continues to prioritise mechanisation and automation in oil palm plantations as a strategic move to future-proof the industry. In the 2024 Budget, a dedicated automation tax incentive was introduced to encourage palm oil companies to adopt cutting-edge technologies, including drones, sensors, and artificial intelligence (AI). This incentive complements ongoing collaborations among industry players, MPOB, and other R&D institutions. I urge PAC members to explore ways to strengthen this synergy by designing and developing game-changing technologies and innovations that can revolutionise our upstream operations.  
    
    
14. In particular, we must explore more efficient and innovative solutions for harvesting and processing oil palm fruits. I recommend that PAC members place a strong focus on mechanisation, precision agriculture, and automation, especially in the upstream segment. Despite MPOB’s achievement in developing over 40 types of mechanised tools and equipment, we have yet to produce a cost-effective and versatile machine capable of performing multiple critical tasks such as harvesting fresh fruit bunches (FFB), evacuating them, and collecting loose fruits. The urgent challenge before us is to deliver a practical, scalable solution that can significantly reduce the industry’s reliance on manual labour while improving productivity and sustainability. 

Ladies and Gentlemen,

15. It is with great concern that I address a recent development impacting our palm oil industry. The United States, under President Donald Trump, has announced the imposition of a 24% tariff on Malaysian palm oil exports. This measure poses a significant challenge to our industry, potentially affecting our export volumes and the livelihoods of many stakeholders.​
    
    
16. In response, the Malaysian Government, through the Ministry of Plantation and Commodities, is actively engaging with ASEAN counterparts to formulate a coordinated regional response. Prime Minister Anwar Ibrahim has emphasised the importance of ASEAN unity in addressing these trade barriers, highlighting the need for open supply chains and collective action. ​
    
    
17. Furthermore, the MPOB has assessed the potential impact of these tariffs. MPOB noted that while the tariffs may lead to a decline in palm oil exports to the U.S., the negative impact would be more pronounced in the importing country due to limited alternatives to palm oil. Palm oil used in U.S. industries cannot be easily replaced by other oils, suggesting that the increased costs may ultimately affect U.S. consumers. ​
    
    
18. The Government remains steadfast in its commitment to defending the interests of our palm oil industry against such trade barriers. We are exploring all avenues, including diplomatic engagements and leveraging international trade agreements, to mitigate the impact of these tariffs and ensure the continued growth and sustainability of our palm oil sector.​
    
    
19. In light of these challenges, it is imperative for us to continue our efforts in enhancing the competitiveness of Malaysian palm oil. This includes focusing on sustainable practices, improving yield performance, and exploring new markets to reduce dependency on any single export destination.​

Ladies and Gentlemen,

20. Before I conclude my speech, I would like to once again thank all PAC Members for your participation at this year PAC Meeting. It is my sincere hope that this gathering of innovative minds will heighten MPOB’s R&D efforts and propel the oil palm industry to greater heights. 

On that note, ladies and gentlemen, it is my pleasure to declare open the 2025 PAC Meeting.

Thank you.