Dompok: B10 programme implementation will ease current high palm oil stock

KUALA LUMPUR: The government is confident that implementation of the 10 per cent palm biodiesel blending (B10 programme) for the non-subsidised sector will ease the current record high palm oil stock.

 Plantation Industries and Commodities Minister Tan Sri Bernard Dompok said implementation of the B10 programme nationwide would further assist removal of crude palm oil stock from the marketplace.

“We expect the full implementation of the B10 programme by end of this year will ease the palm oil stock to a more comfortable level of below two million metric tonnes,” he told reporters after opening the Palm Oil Review and Outlook Seminar 2013 here yesterday.

The Malaysian Palm Oil Board (MPOB) reported last week that the December 2012 palm oil stock had increased 2.41 per cent from November to 2.63 million tonnes.

Dompok said the government would expedite implementation of the B5 programme nationwide and to improve it to B10.

He said the government had spent over RM30 million to set up blending facilities and most of them would be ready by end of this year.

“We expect the full implementation of B5 and B10 programmes will help reduce about one million tonnes of the current stock level,” he said.

The minister said the current weak global economy had resulted in weak export figures.

“Based on the current economic scenario, I foresee signs of improvement in the global economy and expect improvements in exports of our palm oil products,” he said.

On his expectations on CPO prices, Dompok declined to give figures, but said he was looking forward for sustainable prices which would benefit all parties including farmers, millers and refiners.

He said the government was optimistic that the implementation of the restructured export duty would benefit downstream industries especially the refinery sector.

The restructured export duty for oil palm would also allow the industry to compete on a level-playing field, he said.

“This measure was implemented after consultations and feedback from industry players to address the competitiveness issue arising from the export duty structure imposed by Indonesia,” he said.

Last week, cargo surveyor Intertek Testing Services reported that palm oil products exports between Jan 1 and Jan 10 tumbled 25 per cent to 373,462 tonnes from a revised 499,732 tonnes shipped from Dec 1 to 10.