@ AGROBiz | March-April. 2026

FUEL FROM FIELDS: The use of B100 biodiesel is expected to expand demand for palm oil while reducing reliance on imported fuels.( Photo by: FELDA).

• Felda is piloting B100 biodiesel across its operations to test real-world viability in plantation logistics.

• The initiative aims to reduce reliance on imported diesel while boosting domestic palm oil usage.

• B100, made entirely from palm oil, is positioned as a sustainable and locally sourced fuel alternative.

B100 BREAKTHROUGH

The initiative centres on B100 biodiesel, a fuel derived entirely from palm oil without fossil blending, which is being introduced on a pilot basis across Felda settlements. Early deployment is expected to take place at FGV mill sites, where the fuel will be tested across a range of operational vehicles, including lorries, four-wheel drives and heavy plantation machinery.

Felda Chairman Datuk Seri Ahmad Shabery Cheek said the move is designed to assess the fuel’ s practicality under real working conditions, particularly within plantation logistics. By starting within its own ecosystem, Felda aims to build operational confidence before considering wider adoption.

The effort reflects a broader ambition to strengthen Malaysia’ s energy resilience by reducing reliance on imported diesel. At the same time, it underscores the country’ s capacity to leverage its own agricultural resources, particularly palm oil, for domestic energy use.

Despite being the world’ s second-largest producer of palm oil, with an annual output of about 20 million tonnes, Malaysia has historically channelled most of its production towards export markets. Domestic utilisation for energy purposes remains limited, leaving the industry exposed to external pressures such as sustainability requirements and trade restrictions.

In this context, expanding biodiesel consumption is seen as a way to rebalance

Datuk Seri Ahmad

Shabery Cheek.

the sector. Increased domestic demand could provide a more stable outlet for palm oil, while also supporting incomes among smallholders and settlers linked to the supply chain.

Beyond its agricultural implications, B100 biodiesel is also being positioned as a strategic response to global energy uncertainties. Ahmad Shabery noted that ongoing geopolitical tensions, particularly in West Asia, have highlighted vulnerabilities in conventional fuel supply chains.

A locally produced alternative such as B100 could help cushion against such disruptions

FROM PLANTATION TO POWER: Right now, B100 biodiesel is seen as a potentially competitive alternative to conventional diesel.( Photo by: FELDA). while contributing to national energy security.

From a cost perspective, B100 is estimated to be priced at around RM4.50 per litre, depending on crude palm oil prices. At levels below RM5.00 per litre, it is considered potentially competitive with diesel, with the added advantage of supporting domestic price stabilisation.

However, scaling up the initiative remains contingent on several factors, particularly policy support and production capacity. Ahmad Shabery indicated that discussions have been held at the highest levels of government, including with the Prime Minister and Deputy Prime Minister, to explore the framework needed for broader implementation.

MANAGING SUPPLY CONSTRAINTS

One of the key challenges lies in ensuring sufficient crude palm oil supply to sustain large-scale adoption, alongside the need to expand biodiesel processing infrastructure. Felda and FGV Holdings are currently exploring potential partnerships, including private sector involvement and government backing, to accelerate the development of processing plants.

Initial trials have shown promising results. Since 2025, a 15-month pilot involving passenger vehicles has covered over 50,000 kilometres, while earlier tests with tanker trucks have also been conducted. These trials provide early indications of the fuel’ s operational viability, though further validation will be required before nationwide rollout can be considered.

For now, the introduction of B100 within Felda’ s operations marks a measured but deliberate step towards integrating agriculture and energy. Its long-term trajectory will ultimately depend on how effectively policy, supply chains and industry collaboration align to support its expansion.- @ AGROBiz