Palm oil production in Malaysia
Palm oil production is vital for the economy of Malaysia, which is the world's second- largest producer of the commodity after Indonesia. The Malaysian Palm Oil Board (MPOB) is a government agency responsible for the promotion and development of the palm oil sector in the country. The country's palm oil industry produces about 90 million tones of lignocellulosic biomass, including empty fruit bunches, oil palm trunks, and oil palm fronds, as well as palm oil mill effluent (POME). In 2010, in response to concerns about social and environmental impact of palm oil, the Malaysian Government pledged to limit palm oil plantation expansion by retaining at least half of the nation's land as forest cover.
Palm oil trees were introduced to British Malaya by the British government in early 1870s as ornament plants. The first commercial palm oil cultivation was done in Selangor in 1917. In the early 1960s, palm oil cultivation increased significantly under the government diversification program to reduce Malaysia's dependency on rubber and tin.
As of December 2012, palm oil plantation accounted for a total land use of 51,000 km2 in Malaysia. It makes up 77% of agricultural land or about 15% of total land area in Malaysia.
In 2012, the Malaysian palm oil industry employed an estimated 491,000 workers.
Malaysia's Sime Darby is the largest listed palm oil company globally, based on plantation area and fresh fruit bunch production. The company was created through a Malaysian government initiated merger in December 2006. The world's second-largest oil palm plantation company, Felda Global Ventures Holdings (FGV), is also based in Malaysia.Felda Global Ventures Holdings is the world's third largest palm oil company by planted acreage, controlling over 850,000 ha of land in the country, including approximately 500,000 ha that it leases and manages for smallholders.
In the 1960s, research and development (R&D) in oil palm breeding began to expand after Malaysia's Department of Agriculture established an exchange program with West African economies and four private plantations formed the Oil Palm Genetics Laboratory. The Malaysian government also established Kolej Serdang, which became the Universiti Putra Malaysia (UPM) in the 1970s to train agricultural and agroindustrial engineers and agribusiness graduates to conduct research in the field.
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