KUALA LUMPUR: Sime Darby Plantation Bhd (SDP) will progressively shift its focus to India and China and away from the European Union (EU) market as the two nations offer significant potentials to the company, said group managing director Datuk Mohamad Helmy Othman Basha.
He said the company is looking for more partnerships and business opportunities in China and India and does not rule out the possibility of supplying ingredients to the final product suppliers in the two countries.
“We are also working with some other parties, but India is where we believe there is huge potential. So we will be looking at more (business opportunities) by forming partnerships with domestic businesses as the demand for vegetable oil is high,“ he told Bernama on the sidelines of the Malaysian Palm Oil Board (MPOB) International Palm Oil Congress and Exhibition (Pipoc 2023) here.
Pipoc 2023’s theme “Navigating Uncertainties, Building Resilience” reflects the industry’s concerted efforts in addressing global challenges and striving for greater heights.
Mohamad Helmy underlined that amid the EU's tough regulations on palm oil, Malaysia's export volume to the trading bloc has been continually falling over the years.
“We want to send a message to different governments, regulators and lawmakers in Europe. We have other choices and other options. The consumption is declining and why should we put a lot of effort just to satisfy this smaller market, whereas in India, it's been growing.
“The export volume going into the EU can be easily fulfilled by corporations like Sime Darby. We have a sophisticated system to trace where the oil is coming from. The EU is discriminating against smallholders since the output of small farms is harder to trace,” he added.
He reiterated that the EU remains an important market for SDP, whereby the group, alongside its contractors and vendors, are adhering to the stringent standards set by the lawmakers.
“It is not a problem for us to meet whatever regulations they impose, even with the EU Deforestation Regulation. We have been complying with this rigorous standard, and 100% of Malaysian palm oil going into the EU is certified by The Roundtable on Sustainable Palm Oil.
According to a report by the MPOB, India maintained its position as the largest Malaysian palm oil export market in 2022 for the ninth year consecutively since 2014, with 2.89 million tonnes or 18.4% of total Malaysian palm oil exports, followed by China at 1.76 million tonnes (11.2%), and the EU at 1.47 million tonnes (9.4%).
Malaysian palm oil exports to the EU fell by 10.1% to 1.47 million tonnes in 2022 from 1.64 million tonnes in 2021.
Meanwhile, Mohamad Helmy remarked earlier in his presentation on “Building Resilience in a Volatility, Uncertainty, Complexity, and Ambiguity (VUCA) World”, that an organisation must be adaptable and prepare for uncertainties.
“You must prepare your organisation for the changes that will occur as well as the problems that you will encounter. You can overcome these adjustments since the organisation is adaptable. So, that’s how you prepare, there’s no other way. You must maintain the highest standards while pushing the boundaries,“ he said.
