Jan 20, 2012
Small farmers in big industry earn consistent incomeBack
DURBAN|Expertise|Africa|Components|Ports|Africa|Malaysia|Morocco|Nigeria|South Africa|Food Oils|Large-scale Corporate Industry Manufacturing Oils|Manufacturing|Natural Oil|Oil|Palm Oil|Palm Oil Production|Palm Oil Products|Products|Bernard Dompok|Infrastructure|BIOFUELS
© Reuse this
About 40% of the country’s 18.2-million tons of palm oil production comes from small- holders, who consistently earn between R600/acre and R1 000/acre of mature palms each month.
“It is a good crop to elevate people out of rural poverty and lots of Malaysians who have land or have developed their properties are much better off than before. If a farmer has 5 ha of mature palm oil, he can get R6 000 to R10 000 a month.
“It [resolves] some of the problems in the rural areas, where people have land but no other income,” he stated at the Malaysian Palm Oil Trade Fair and Seminar, in Sandton, in December.
The certainty of the farmer’s income is linked to the large-scale demand created by the greater industry, the scale of which also helps to reduce supply risks and, thus, price volatility. The country’s production from January to September was around 18.2-million tons of palm oil and related products, earning it around R123.5-billion, or 9.8% of its total exports each year, with 150 000 t of palm oil being exported to South Africa in 2010.
The oil is used in the manufacture of food oils, soaps, biofuels, phytonutrients and cosmetics, with proponents noting that the oils are derived from natural sources, not petroleum, making them renewable.
For the cosmetics industry, demand for palm oil products is expected to increase as people seek out products made from the high-quality natural oil. Further, the oil also contains tocotrienols, a type of vitamin E, and there is growing interest in the oleochemicals owing to the oil’s price and fatty acid composition. Malaysia has produced 2.15-million tons of oleochemicals from palm oil for the year up to September 2011, he said.
The Minister noted that, prior to attending the seventeenth Congress of the Parties conference in Durban, he had visited a business in Pietermaritzburg that manufactured soaps using imported Malaysian palm oil.
However, Malaysia practises a market economy and Dompok noted that, although there was no explicit limit on land ownership, the country had achieved 40% of palm oil production from smallholders.
“[Palm oil] planting companies can become very big. There is trading of land, buying and selling, but most of the time people develop the land and do not sell it, preferring to target incomes coming out of good oil,” he explained.
Further, Dompok noted that a number of Malaysian companies and plant companies were establishing joint ventures with South African firms and that the government, in partnership with industry body the Malaysian Palm Oil Council, were encouraging more.
“We are also happy to see some companies owned by South Africans who want to venture into this industry, and we can work out what encouragement and assistance we can give to them,” he noted.
The Palm Oil Trade Fair and Seminar was aimed at attracting new entrepreneurs to invigorate trade in the commodity and Malaysia aims to play a significant role in developing downstream activities in importing countries, such as South Africa, Morocco and Nigeria, besides others.
The industry employs in excess of 570 000 people in Malaysia.
“All these developments would not have materialised without the government taking a proactive approach to complement the private sector initiatives by improving the national infrastructure and supporting facilities such as ports, bulking installations and transportation,” said Dompok.
Malaysia offers the right policies to help the growth of the palm oil downstream sector. In the upstream sector of the industry, such as the palm oil plantations, Malaysia is ready to help relevant multinational parties and contributes to technology, labour, expertise, raw materials and other inputs for the industry, he said.
Significant research is being done in the industry, including mapping the genome of the plant species that will help to improve production yield, concluded Dompok.
Edited by: Martin Zhuwakinyu© Reuse this Comment Guidelines (150 word limit)
Other Chemicals News
Article contains comments
Updated 44 minutes ago A series of unfortunate events led to Johannesburg and surrounding areas experiencing significant water shortages over the past week, City of Johannesburg mayoral committee member for development planning and urban management Roslynn Greeff said at a media briefing...
Updated 1 hour 7 minutes ago Based on reports submitted to National Treasury, municipalities owe water boards some R2-billion, Cooperative Governance and Traditional Affairs Minister Pravin Gordhan revealed in a written response to a Parliamentary question on Monday. Municipalities in the Free...
Updated 1 hour 21 minutes ago South African cement group PPC CEO and director Ketso Gordhan has resigned with immediate effect as a result of a “difference of opinion” with the board regarding board procedures for the approval of certain decisions. Nonexecutive chairperson Bheki Sibiya would now...
Recent Research Reports
Road and Rail 2014: A review of South Africa's road and rail infrastructure (PDF report)
Creamer Media’s Road and Rail 2014 report examines South Africa’s road and rail transport system, with particular focus on the size and state of the country’s road and rail network, the funding and maintenance of these respective networks, and the push to move road...
Real Economy Year Book 2014 (PDF Report)
This edition drills down into the performance and outlook for a variety of sectors, including automotive, construction, electricity, transport, steel, water, coal, gold, iron-ore and platinum.
Real Economy Insight: Automotive 2014 (PDF Report)
This four-page brief covers key developments in the automotive industry over the past 12 months, including an overview of South Africa’s automotive market, trade figures, production and the policies influencing the sector.
Real Economy Insight: Construction 2014 (PDF Report)
This five-page brief covers key developments in the construction industry over the past 12 months. It provides an overview of the sector and includes details of employment in the sector, infrastructure and municipal spending, as well as insight into companies’...
Real Economy Insight: Electricity 2014 (PDF Report)
This five-page brief covers key developments in the electricity industry over the past 12 months, including details of State-owned power utility Eskom’s generation activities, funding and tariffs, independent power producers and prospects for the sector.
Real Economy Insight: Road and Rail 2014 (PDF Report)
This six-page brief covers key developments in the road and rail industries over the past 12 months, including details of South Africa’s road and rail network and prospects for both sectors.
This Week's Magazine
While Ekurhuleni-based transformer manufacturer Reliable Transformers currently designs, manufactures and tests its products according to the SANS 780 specifications for distribution transformers and other applicable transformer specifications, it is working towards...
Global endpoint security solutions company Kaspersky Lab has introduced new measures to prevent cyber criminals from accessing sensitive data, alongside its malware-signature and heuristic device analysis detection methods. Threats to mobile devices have increased...
To ensure uptake and a positive impact, Wireless Fidelity (Wi-Fi) networks in cities must be provided at schools, community centres and commercial centres to enable citizens and government to access information that will improve access to and delivery of services....
Eco-estate Monaghan Farm, located near Lanseria airport, north-west of Johannesburg, has taken a new approach to modern living and sustainability with its 517 ha development, dedicated to farm living.
Forklift and lift-truck distributor Goscor Lift Hi-Reach launched the Genie SX-180, the tallest self-propelled super boom in Africa, in Johannesburg last month. “As the official distributor of the well-known Genie range of equipment in Southern Africa, we are pleased...