PLANTATION & COMMODITY
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PLANTATION & COMMODITY
@ AGROBiz | May-June. 2026
Malaysia eyes China growth
• Malaysia sees opportunities to expand value-added and speciality palm-based applications in China.
• The growing demand for sustainable, traceable palm oil products continues to shape industry collaboration.
• Malaysia raised its biodiesel mandate from B10 to B15 in Peninsular Malaysia from Jun 1.
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ALAYSIA’ S palm oil industry is seeking a stronger foothold in China’ s fastevolving oils and fats sector, following a series of strategic engagements to expand collaboration in innovation, sustainability, and downstream development.
The programme, coordinated by the Malaysian Palm Oil Council( MPOC), featured The Malaysian Palm Oil Forum( MPOF) China 2026 in Shanghai alongside high-level engagements with key industry players, including COFCO Corporation, Yihai Kerry Arawana Food Group( Wilmar China) and Taiko Palm-Oleo( Zhangjiagang) Co., Ltd., a subsidiary of Kuala Lumpur Kepong Berhad( KLK).
It also highlighted opportunities in food, oleochemical, and industrial uses of palm oil in China’ s evolving market.
During the visit, Plantation & Commodities Minister Datuk Seri Dr Noraini Ahmad officiated MPOF China 2026, where stakeholders examined market trends, sustainability, innovation, and new applications for palm oil products.
GROWING DEMANDS
The event also strengthened business ties between Malaysian producers and Chinese manufacturers.
Noraini highlighted the need for closer industrial integration between the two countries as global demand evolves.
“ China continues to play an important role in the global oils and fats industry, not only as a major market but also as a leading manufacturing and innovation hub.
“ Malaysia sees strong opportunities to deepen collaboration with Chinese industry players in downstream processing, specialty applications, and sustainable supply chains.”
Further meetings with COFCO Corporation focused on long-term supply, market outlook, downstream processing, and sustainability within China’ s edible oils ecosystem, where palm oil remains a key input.
CONSUMER PREFERENCE
At Yihai Kerry’ s R & D Centre in Shanghai, discussions addressed innovation in specialty fats, changing consumer preferences, and new palm-based
Noraini Ahmad
SITE VISIT: The Malaysian delegation touring Taiko Palm- Oleo’ s facility in Zhangjiagang as part of efforts to strengthen downstream palm oil collaboration with China.
applications for China’ s food sector. The delegation also visited
Zhangjiagang, where discussions highlighted the growing importance of palm-based oleochemicals in personal care, home care, pharmaceutical and industrial applications, alongside increasing global requirements for traceability and sustainability compliance.
Noraini noted that China’ s expanding downstream and oleochemical industries create opportunities for Malaysia to move up the value chain and strengthen supply networks between the two countries.
The programme showed Malaysia’ s commitment to reinforcing partnerships with China and expanding its role as a reliable supplier of sustainable, innovative palm oil products in a changing global market.
Fuelled by palm
MALAYSIA’ S biodiesel programme entered a new phase on Jun 1 with the B15 biodiesel mandate in Peninsular Malaysia, aiming to enhance energy security and boost domestic palm oil demand.
Under the new blend, diesel fuel now contains 15 per cent Palm Methyl Ester( PME) derived from palm oil and 85 per cent reliance on imported fossil fuels while supporting the local palm oil industry.
Deputy Prime Minister Datuk Seri Dr Ahmad Zahid Hamidi said biodiesel development will progress with future blending rates depending on market conditions and industry readiness.
He also noted crude palm oil byproducts could be used for biodiesel and
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sustainable aviation fuel, creating new sector opportunities.
B15 FOR THE FUTURE
Biodiesel is also expected to generate economic benefits, especially in rural areas via agencies like FELCRA, KETEN- GAH and KESEDAR.
Plantation and Commodities Minister Datuk Seri Dr Noraini Ahmad said B15 was carefully planned and will not affect Malaysia ' s palm oil export commitments.
Palm oil consumption under B15 is estimated at 0.8 million tonnes annually, with a domestic surplus of about four million tonnes.
With 20 million tonnes produced and 16 million exported each year, Noraini said supply is sufficient for biodiesel without disrupting exports.
The higher blending mandate also supports energy resilience if global fuel disruptions persist.
University Putra Malaysia( UPM) Biorefinery Complex head Prof Dr
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Hidayah Ariffin said increased biodiesel usage could help extend diesel stock availability and improve supply stability during periods of market uncertainty.
DRIVING CHANGE
Meanwhile, concerns over vehicle compatibility have been addressed by the government, with Economy Minister Akmal Nasrullah Mohd Nasir previously stating that Malaysian vehicle specifications have supported
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THE B15 MANDATE: Increased biodiesel usage could help reduce dependence on imported fossil fuels amid global energy market uncertainty.
biodiesel blends of up to B20 since 2020.
B20 biodiesel is already used in Sarawak, Labuan, and Langkawi without major issues.
The National Biodiesel Programme started with B5 in 2011, expanding to B7 in 2014 and later B10 and B20 by 2020.
With 19 licensed biodiesel plants, the programme is expected to reduce greenhouse gas emissions and support Malaysia ' s transition to a sustainable energy future.- @ AGROBiz
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