Malaysia to set up CPO distribution in Africa, Europe

Malaysia to set up CPO distribution in Africa, Europe

Agence France-Presse, Kuala Lumpur

Malaysia has announced plans to set up palm oil distribution centers in Africa and Eastern Europe to boost crude palm oil (CPO) exports into new markets, a report said Thursday.

Victor Ngo, regional head of the Malaysian Palm Oil Promotion Council, said the centralized hubs would cut shipping costs by effectively distributing palm oil to end-consumers.

As CPO buyers from Eastern Europe and Africa were small-scale buyers, shipping freight costs would be fully exploited with the setting up of the distribution centers, which could reach consumers more effectively, he said.

"It's more economical to send one big shipment from Malaysia to a single point before distributing it to smaller buyers in the region," Ngo was quoted as saying by the Star daily.

He said port cities such as Durban in South Africa, Mombasa in Kenya, Dar-es-Salam in Tanzania and Odessa in the Ukraine were some of the potential locations to be developed.

"We are in the process of identifying suitable locations for such centers."

Ngo said Malaysia should look into expanding its export markets to avoid being over-dependent on traditional markets China, India and Pakistan.

He said that CPO exports to Africa and Eastern European countries last year amounted to some 500,000 tons and 300,000 tons respectively, adding that Malaysia, the world's largest palm oil producer, had the potential to triple its exports to those countries within the next few years.