Minimal impact on palm oil sector from US tariff against Malaysia: MPOB
The Malaysian Palm Oil Board (MPOB) is confident that the impact of the 24 per cent tariff imposed by the United States (US) on the country’s palm oil industry will be minimal, despite concerns over the potential implications of the new trade policy.
MPOB director general Datuk Dr Ahmad Parveez Ghulam Kadir said Malaysia’s palm oil exports to the US account for less than one per cent of total national production.
“Although the tariff may have an indirect effect such as price increases, it will not significantly affect demand in the US.
“The impact is not direct, but there may be a knock-on effect, especially in the form of higher end-product prices, which consumers in the US will ultimately bear,” he said during the signing of a Memorandum of Agreement (MoA) with SumiSaujana Group Bhd April 7
He acknowledged that some trade disruptions may occur in the early stages, but noted that demand for palm oil in the US remains strong, particularly in niche sectors for specialty products.
“Palm oil continues to be essential for specific markets such as conventional rice production and products requiring transparent supply chains. Malaysia also has a competitive edge, with a lower tariff rate of 24 per cent compared to Indonesia’s 32 per cent and Thailand’s 36 per cent,” he added.
While exports to the US are relatively small given palm oil is not widely used for cooking there, it remains in demand for high-value specialty items.
In 2023, Malaysia’s palm oil exports to the US grew 70 per cent compared to the previous year.
“There is still steady demand because palm oil serves a specialised market that doesn’t directly compete with other oils like soft oils. We will continue efforts to diversify our markets and boost exports to other countries,” Ahmad Parveez said.
“We are not relying on just one country. Malaysian palm oil must be accepted globally, and we are actively exploring high value-added markets to ensure global demand is met.”
He said exports to the Philippines had significantly increased last year, and with Malaysia holding the Asean chairmanship in 2025, he hopes to see greater export activity to neighbouring countries.
Meanwhile, MPOB formalised a Memorandum of Agreement with SumiSaujana and its subsidiary Sumisaujana TCM Chemicals Sdn Bhd, a producer of specialty chemicals for the oil and gas sector, to commercialise the board’s palm-based technology.
The agreement includes a licencing and commercialisation agreement for the manufacturing and marketing of palm-based intermediates, palm-based polyols and bio-based polyester polyols.
The licensed technologies feature palm-derived intermediates and polyols that offer renewable alternatives to conventional petroleum-based chemicals, marking another step in Malaysia’s push toward sustainable industrial innovation.
SumiSaujana executive director Norazlam Norbi hopes one of the products will be ready for commercialisation within six months while three technologies will be ready by one year.
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Further development of the grain sector in the Black Sea and Danube region will be discussed at the 23 International Conference BLACK SEA GRAIN.KYIV on April 24 in Kyiv.
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