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ABSTRACT
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Prospects
of Elevating National Oil Palm Productivity: a Malaysian Perspective
The expansion of oil
palm plantings has been phenomenal: from 60 000 ha in 1960 to 3.50 million
hectares in 2001 and an expected 5.10 million hectares in 2020. The increase
in palm oil production has accordingly reflected the pattern of the planted
area, i.e. 91 793 t in 1960 to 11.80 million tonnes in 2001 and an
expected 18.81 million tonnes in 2020.
The national oil yield
average does not seem to increase in step with the advances made in science
and technology. The national oil yield average was 3.63 t/ha from 1975
to 2001, while the last 10-year average (1992-2001) was only 3.50 t/ha.
This is very low indeed with no significant difference from other competing
countries.
Oil palm breeding
has improved the planting materials. The oil yield of duras has improved
from 2.8 to 4.5 t/ha after four selections. The oil yield of teneras from
subsequent dura selections and introgression with selected pisiferas has
improved from 6.3 to 11.2 t/ha in the last four decades.
Why then is the national
oil yield average still low? There can be many macro-reasons. Some reasons
can be that with the rapid expansion of oil palm area, the limited areas
of Class 1 and 2 soils have been used up and plantings have extended to
Class 3 (marginal) and 4 (unsuitable) soils. Some other reasons may be
inadequate agronomic inputs (especially fertilizer, field maintenance,
etc.), shortage of skilled labour, ineffective and inadequate estate management,
low replanting rate, and imbalance of extension service capability vis-à-vis
increases in oil palm plantings. These factors can lead to a combination
of low fresh fruit bunch (FFB) yield and oil extraction rate (OER) which
will eventually lead to low oil yield.
There is a need to
have strategies and a plan of action to overcome these constraints in order
to increase the national oil yield average to the target
of 8.8 t/ha by 2020. Implementation of short-term strategies can lead to
an immediate increment in oil yield. However, it would need the implementation
of medium- and long-term strategies to eventually lead to achieving the
target. The incentive for the industry to follow these strategies will
be an increase in yield with a sustained cost of production, thus making
the industry more profitable and competitive.
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Malaysian
Palm Oil Industry at Crossroads and its Future Direction
Palm oil accounts
for 20% and 46% of the global oil and fats production and trade respectively.
Malaysia is the world’s largest producer and exporter of palm oil with
a 50% share of world palm oil production and 61% of exports. This paper
assesses the growth of the Malaysian palm oil industry and the limitations
of land and labour on the future growth of the industry. The industry’s
competitive edge will continue to be a vital factor for its future development.
Thus, in order to remain competitive, the industry needs to improve on
productivity, explore opportunities to diversity the income base, widen
the end-use base for palm oil, explore new marketing approaches and intensify
vertical integration.
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Arbitration
Issues in the International Vegetable Oil Trade
This paper concerns
settling commercial disputes in the oils and fats trade. The usual method
is litigation before the courts and commercial settlements. However, between
these two extremes are arbitration, coordination and mediations. The FOSFA
system of arbitration offers the best for obtaining commercial justice,
swiftly and at a reasonable price.
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US
Agricultural Subsidies and their Implications on Oilseeds and, Oils and
Fats Trade
Palm oil is today
the leading edible oil traded in the world market, accounting for more
than 40% of the total export trade of 17 oils and fats. Although
oil palm is widely recognized as the highest yielding oil crop, this does
not in any way guarantee that it is the most cost competitive. The reality
is that trade distorting measures in the form of agricultural production
subsidies and export assistance programmes continue to challenge the competitiveness
of palm oil and subsequently, its position as the most competitive vegetable
oil.
In highlighting the
implications of trade distorting agricultural subsidies, it is clear that
farmers’ planting decisions in the US are related to the attractive loan
rate rather than the market price, thus introducing potential production-influencing
effects into the market place.
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