PUTRAJAYA: Malaysia’s trade in palm oil and other agricultural commodities with China is set to deepen with an upcoming memorandum of understanding (MOU) that is expected to be signed later this year, says Datuk Chan Foong Hin.
The Deputy Plantation and Commodities Minister said the MOU is also an important milestone to mark 50 years of diplomatic relations between Malaysia and China.
“(The MOU) is set to be finalised this year, either when Chinese Premier Li Qiang visits Malaysia or when Plantation and Commodities Minister Datuk Seri Johari Abdul Ghani goes to China,” he said.
The MOU will be signed between Malaysia’s Plantation and Commodities Ministry and China’s Agriculture and Rural Affairs Ministry.
“With our collaborative efforts, palm oil trade will deepen and continue to reach new historic highs,” said Chan, adding that increasing exports of such high value-added palm oil products to China is part of the ministry’s new direction.
China has been Malaysia’s largest trading partner for 15 consecutive years, he said, and both countries enjoy a friendly, collaborative relationship.
“In 2023, Malaysia exported RM192.2bil worth of goods to China, with agricultural commodity exports accounting for over RM20bil.
“Exports of palm oil and its products take the largest share of the pie at RM11.03bil, followed by rubber (RM5.43bil), timber (RM2.83bil), cocoa (RM684mil), tobacco (RM18.43mil) and pepper (RM11.88mil),” he added.
Chan said he has received many requests about expanding palm oil exports to China, but Malaysia’s production has stagnated at about 18 million tonnes of crude palm oil per year.
Of the 18 million, three million have been earmarked for domestic consumption, while the rest is exported to China and other world buyers.
“The real question is how we can maximise the value of those 18 million tonnes,” he said.
Palm oil production is limited, as Malaysia has capped the number of oil palm plantations at 6.5 million hectares in order to preserve primary forest cover.
Chan also revealed that the spicy Chinese Sichuan mala hotpot, a popular dish in all parts of China, is now a key to Malaysia’s aim of getting its roughly one billion consumers to buy more Malaysian palm oil products.
Usually, mala hotpots use animal fats, but as dietary habits shift to favour plant-based oils, Malaysia hopes that this will boost the use of palm oil, which is a healthier alternative, said Chan.
He added that using palm oil as an ingredient in mala hotpots is one of the many ways that Malaysia wants to increase exports of high-value palm oil products to China.
Other than the hotpot sauce, products derived from palm oil include plant-based meat, pancakes, crab feed, ice cream, hand creams and more, he said.
