Lorenzo pushes dev’t of local palm oil industry

Agriculture Secretary Luis Lorenzo Jr. is optimistic that "the development of palm oil production in the Philippines could be augmented with super quality planting materials from Malaysia, the neighboring country being the best source."

The secretary is referring to the Dura pecefira variety which can be immediately planted on 1,000 hectares at 165 seedlings per hectare. A. Brown Energy and Resources Development Inc. (ABERDI), a private investor has signified its interest in investing in the planting materials.

Lorenzo, however, has recommended procurement of the seedlings through a government-to-government counter trade arrangement during the bilateral meeting between President Arroyo and Malaysian Prime Minister Abdulllah Badawi some months back.

Last year, over P1 billion worth of crude palm oil for processing and use of food manufacturer was imported by the Philippines; domestic consumption is increasing by at least 10 percent annually. "The Philippines should devote at least 70,000 hectares for palm oil plantations to be able to meet the growing local demand for the next five years," Lorenzo explains.

Lorenzo also called on Philippine coconut oil miller and refiners to redress the balance of coconut and palm oil production distribution and production in the country. He envisioned a shift to the cheaper-to-produce palm oil for cooking oil and the development of value-added products from premium coconut oil and by-products including: coco medium fatty acids for the making of soaps, shampoos and detergents and coco fatty alcohols as raw materials for surfactants in detergents, toothpaste, cosmetics and fabric softeners.

"Palm oil is a very competitive crop," says Lorenzo. "What is even more encouraging is that most of the marginally developed agricultural areas on Mindanao are suited for oil palm growing." Aside from its proximity to Malaysia, Mindanao’s evenly distributed rainfall and moderate climate are just fine for oil palm.

In the Philippine condition, oil palm plantation needs an investment of about P50,000 per hectare with a gestation period of four years. After the first harvest, P60,000 could be earned from one hectare in one year. About 4,000 contiguous hectares will give sustainability to a palm oil mill.

A mill in Impasugong, Bukidnon to be run by ABERDI will be constructed soon, the secretary said. This will make investment in oil palm plantations attractive to farmers and investors. Land Bank of the Philippines, a government corporation, has a loan program for them which takes care of their financial needs during the gestation period until the oil palms are ready for harvesting.

For his part, Philippine Coconut Authority Administrator Danilo Coronacion urges the government to "engage all the stakeholders and allied sectors in the formulation and forging of consensus on policy and strategy framework for the development of oil palm industry as a complement to the coconut enterprise."

By year 2010, Coronacion is optimistic that the Philippines would have 35.31 hectares of full bearing plants serviced by seven units of oil mills with 20-30 tons fresh fruits bunch per hour capacity.

The size of oil palm plantations in the country stood at 20,74 hectares in 2002 with an average annual yield of 54.500 metric tons The government intends to meet the shortfall of 44,000 metric tons imported from Malaysia, China, Indonesia and Singapore. Fast food chains and the fish canning industry account for the total annual requirement of 94,500 MT.

Coronacion, furthermore recommended the following measures in order that oil palm farming will not interfere with coconut farming:

• Planting of oil palms should not be done in coconut plantations.

• Production in areas covered by agrarian reforms and ancestral domains shall be under a contract growership scheme.

• Identification of market niche for palm oil food use to minimize competition with coconut oil and enhance complementation of the two products.

• Monitoring and regulation of the use of chemical inputs that may harm the environment.