Govt allocates RM130mil for oil palm owners to obtain certification

According to Subur Tiasa senior independent director Ngu Ying Ping the company may seek a renewal of the oil palm plantation licence to expand the oil palm plantation operation or venture into plantation of trees that would complement its timber operation.

PUTRAJAYA: The Government has allocated RM130mil as an incentive for oil palm smallholders to help them obtain Malaysia Sustainable Palm Oil (MSPO) certification for free.

Plantation Industries and Commodities Minister Datuk Seri Mah Siew Keong said in view of the mandatory implementation of the MSPO by end-2019, the incentive would ease their financial burden by providing for the certification's auditing fees.

“We plan to carry out the audit on 650,000 smallholders in batches, and it would involve close to two million hectares of oil palm plantation,” he told reporters here yesterday.

For now, he said, only 4% of about 244,622ha of plantations, including 7,113ha owned by smallholders and 22 mills, had voluntarily obtained the certification since it was introduced in January 2015.

Mah said the incentive would involve 40% from the total of 5.7 million hectares of oil palm plantation in Malaysia.

“By giving the incentive, the ministry is targeting about 500,000ha of oil palm plantation to be MSPO-certified by year-end, and the number will continue to increase next year.

“The ministry will be conducting roadshows to brief the smallholders on the importance of the certification, especially in ensuring the sustainability of the local oil palm industry in the future,” he said.

Through the MSPO certification scheme, he said, palm oil products would be able to command premium prices in the international market, in line with demands from European countries which only allowed for palm oil imports with accredited certification.

“The MSPO is more suitable for the country compared to the Roundtable on Sustainable Palm Oil certification process and the cost of its implementation is much lower.

“Although the MSPO certificate has not been recognised by any country at the moment, we hope that its mandatory implementation by end-2019 will show that MSPO is a certificate which has been established according to the law and that domestic regulations also have good sustainability practices.

“We are confident the MSPO will be well-received by the local industry players, and the ministry will promote this certification aggressively overseas to ensure that it is accepted in the international market,” he said.

Mah said the details on the incentives and the application procedures would be available on the Malaysian Palm Oil Board's website soon. – Bernama