ADVANCES IN RESEARCH TOWARDS SUSTAINABLE

PALM OIL

Malaysia Palm Oil Trade Fair and Seminar (POTS) 2014Shangri-la Hotel, Kuala Lumpur

28 – 29 October 2014

Datuk Dr. Choo Yuen MayDirector General

Malaysian Palm Oil BoardMinistry of Plantation Industries and Commodities, Malaysia

Introduction

Research Strategies for Sustainability

Sustainability through Improved Productivity

Sustainability through Value-Addition

Addressing Peat Emission

Life Cycle Analysis

Conclusions

PRESENTATION OUTLINE

Increased profit Environmental stewardship Social responsibility

CHALLENGES OF THE OIL PALM INDUSTRY

SUSTAINABILITY

Planet Profit

PeopleSocial Responsibility

Environmental Health Economic Profitability

POPULATION GROWTH AND FOOD DEMAND

World population will grow by~ 2.3 billion by 2050

Feeding 9.1 billion people in2050 requires a 70% increase infood production

To meet future fooddemand exporting nationsmust increase production

Export by 2050: Sugar - DOUBLE Cereal - TRIPLE Oils - TRIPLE

OIL PALM: MEETING THE DEMAND FOR GREEN TECHNOLOGY

• Population growth –increase in GHG emissions

PALM OIL PRODUCTION IS ENERGY EFFICIENT

• Oil palm ecosystem emits lower GHG

PALM BIODIESEL PLANT

Green Technologies – from palm (e.g. biodiesel helps reduce GHG emissions)

RESEARCH STRATEGIES FOR OIL PALM SUSTAINABILITY

• Improve Productivity• Provide Evidence for Health and

Wellness• Improve Profitability though Value-

addition• Reduce Environmental Bioburden• Clear Misconceptions about palm oil

Research & Development: 10 Strategic Focus Areas

1. Enhance productivity 2. Automation and mechanisation3. Pests and diseases4. Sustainability, environment and countering

anti-palm oil campaign5. Palm oil as premium oil6. Biomass utilisation7. Assistance to Smallholders8. Renewable Energy9. Downstream on food , phytonutrients and

oleochemical10.Peat Research

(USD11.03 billion) (USD4.67 billion)

Oil Palm is One of 12 National Key Economic Areas8 Entry Point Projects

Average Oil Yield

(t/ha/year)Soybean0.40

Sunflower0.57

Rapeseed0.73

Oil Palm*4.01

Oil Crops Production (Mn T)

% of total production

Total area (Mn Ha)

% of total area

Oil palm* 59.39 42.3 14.8 8.3Soybean 41.8 29.8 103.8 58.4Rapeseed 24.4 17.4 33.3 18.7Sunflower 14.8 10.5 25.9 14.6

Source: Oil World Annual 2013* Combined tonnage of palm oil and palm kernel oil

Oil Palm – The Most Productive Oil Crop

Sustainability through Improved Productivity

R&D to Enhance ProductivityIncrease palm oil production without expandingland area (no deforestation), reduce greenhousegas (GHG)• High yielding clonal material through tissue

culture (8-10 t/ha/yr)• Genome: discovery of shell gene, fruit colour,

FAC and IV, candidate markers for mantlingand abnormality, ganoderma resistance,height, markers for high yield

• Kit which predicts fruit-form in nursery palmsor seeds

OIL PALM GENOME

Genetic blueprint of the oil palm

R&D to Enhance Productivity…

duraSh/Sh

teneraSh/sh

pisiferash/sh

tenera pisiferadura

Sh+Sh+M/F = 60%S/F = 30%O/B = 18%

Sh-Sh-S/F = 0

Sh+Sh-M/F = 80%S/F = 10%O/B = 24%

Lignin stained fruits

DISCOVERY OF SHELL GENE

Singh et al. (2013) Nature 500(7462): 340-344

• Our collaboration developed the SureSawitTM Shell Kit – the first commercial gene-assay for oil palm

• Predicts fruit-form in nursery palms or seeds

• Blind testing of > 600 palms: 100% technical success with 100% accuracy

• Kits and services available mid 2014

D = duraT = teneraP = pisifera

400bp

200bp100bp

D T P

SureSawitTM SHELL IDENTIFICATION KIT

Nature 24 July 2013

Published in Nature Communications

30 June 2014

R&D to Enhance Productivity…

Reduce labour dependence through automation and mechanisation• Motorised cutter “CANTAS” – continuous

improvement• Transporter (Beluga)

Mitigation and elimination of pests anddiseases (emphasis on ganoderma)• Study the biology and epidemiology• Biological control – various formulations• New fungicide , tetraconazole, to prolong

the life of Ganoderma-infected palms.• Develop early detection methods• Develop Ganoderma-resistant oil palm• Preventive treatment

R&D to Enhance Productivity…

Research on Value Addition to the Oil Palm

Nutraceuticals

Cosmeceuticals

Industrial Chemicals and Oleochemicals

Biofuels

Food Uses

Pharmaceuticals

Commodity Oil

Value Addition through Food & Nutrition

• 85% of world’s palm oil production is used as food• Positioning palm oil as a superior functional and nutritive oil

Physical Attributes Good oxidative stability – long shelf life Excellent thermal stability – perfect for shallow and deep frying Most other vegetable oils need to be partially hydrogenated to

increase stability

Nutritional Attributes Palm oil does not behave like a typical saturated fat Palm oil is trans-free Importance of sn-2 position

Food Applications of Palm Oil

Traditional Foods• Cooking oil• Industrial Frying Fats• Margarine• Shortening• Vegetable Ghee• Confectionery Fats• Ice Cream• Filled Milk• Non-Dairy Food Products

As a source of pro Vitamin A and E

Innovative Palm Based Products• Palm based Coconut Milk / Santan• Palm based Mayonnaise and

Salad Dressing• Palm-based Ice Cream• Palm-based Cheese Analogue

Trans Fatty Acids (TFA)

• TFA contributes to increased risk of cardiovascular disease

• WHO/FAO (2003-2009) Recommendation – TFA should be limited to <1% of total daily energy in human diet

• In most EU countries and North America – 2% TFA limit in dietary oils/fats

Leverage on the versatility of palm oil to produce zero or low trans formulations

2424

• Palm Oil/Olein with high content of α− and β−carotenes

• The only vegetable oil containing both natural carotene and tocotrienols

• Suitable for shallow frying and salad dressing

Palm Phytonutrients: Red Palm Oil / Olein

GENERAL MISCONCEPTION ON PALM OIL

PALM OIL

Cheaper than other oils

Contains about 50% of saturated fats

Not as good as other vegetable oils

Palm oil is a saturated fats which is associated to CHD/

CVD risks and obesity

Therefore Therefore

NUTRITION RESEARCH ON PALM OIL

• Great strides have been made over the last 25years in elucidating a number of the healthbenefits of palm oil and its fractions.

• Malaysia has funded numerous nutritionalresearch on palm oil at centers of excellenceboth local and abroad.

• This has resulted in:o over 200 publications in high impact peer-

reviewed journals.o collaborative projects undertaken at both local

and international centres of excellence.

TOTAL FATTY ACID COMPOSITION OF OILS & FATS

0 50 100

rapeseed

high oleic sunflower

olive

soybean

groundnut

lard

palm olein

cocoa butter

%

SFAMUFAPUFA

Ong and Goh 2002 FNB

0 20 40 60 80 100

rapeseed

high oleic sunflower

olive

soybean

groundnut

lard

palm olein

cocoa butter

%

SFAMUFAPUFA

Ong and Goh 2002 FNB; Sanders et al. 2011 AJCN 28

sn-2 FATTY ACID COMPOSITION

sn-2 Research• Fatty acid composition alone does not tell you

the whole story – the position of the fatty acidin the TG is more important

• Altering the fatty acid in the sn-2 positionalters lipid profile

• Palm oil does not behave like a saturated fatbecause of oleic acid in the sn-2 position

• Palm oil has similar health properties to oliveoil

• Anti-obesity properties of palm oil

Numerous human studies including oneconducted at the University ofSydney, comparing the health effects ofpalm olein and olive oil (both high inoleic acid) have shown that palm oil(olein) and olive oil have similarbeneficial effects on blood cholesterol.

*OO = Olive OilPO = Palm Olein

Palm Olein and Olive Oil have Similar Effects on Blood Lipids

Value Addition through Biomass Utilisation

BIO-FERTILIZER

BIO COMPOSITE &BIO-PRODUCTS

BIO-BASED CHEMICALS

RENEWABLE ENERGYOil PalmBiomass

Heat & Power*

Solid, liquid and gas bio-fuels **

Mulch*

Compost*

MDF**, Plywood, Fibremats , bio-char and activated carbon etc.

Sugars/Cellulose, **lignin, Vitamin E, Carotenes, Squalene. etc

* Developed** Emerging

Potential Applications of Oil Palm Biomass

Hemicellulose(30-35%)

Lignin(17-21%)

Cellulose(35-42%)

xylose arabinoserhamnose galactose

Green Chemicals

Chemicals Obtainable from Biomass

OIL PALMBIOMASS

Hydrogenation Gas (hydrocarbon)Phenol and cyclohexane derivatives

PyrolysisGas (CO, CO2, H, hydrocarbons)Liquid (methanol, acetic acid, acetone, phenol derivatives, charcoal/activated carbon

Hydrolysis

Alcohols, polyols, ketones and acidshydroxymethylfurfural, levulinic acidPolyols, Glucose

Hexoses

Pentoses Yeast, furfural, alcohol, polyols(xylitol), xylose

Lignin

Cresol, phenol, catechols, vanillin, Thermosetting resin, dispersant, Antioxidant, rubber reinforcement

Products from Pyrolysis of Palm Biomass

ProductsBiomass

Bio-oil(%)

Char(%)

Gas(%)

EFB 38.28 23.05 38.67

Trunk 29.39 16.76 53.86

Frond 25.74 42.54 31.72

Shell 18.93 55.13 25.94

• National Biofuel Policy launched in March 2006• Main strategic thrusts among others, involve

production of palm biofuel for export and local use• Benefits:

• value addition;• support the price of palm oil: every RM100/tonne

price increase of palm oil will increase export revenue by RM1.6 billion a year;

• reduce reliance on imported fossil fuels;• environmentally friendly

Value Addition through Biodiesel/Biofuel

Development of Biodiesel Industry in Malaysia

• Malaysia has undertaken R&D on palm-based biofuels since 1982

• Home-grown palm biodiesel production technologies, including winter grade biodiesel have been successfully commercialised

• Palm biodiesel are exported to EU and USA

• Palm biodiesel meets the international standards (EN 14214 and ASTM D6751)

• Palm biodiesel– Normal grade biodiesel – Winter grade biodiesel

• RBD palm oil / petroleum diesel blends as diesel substitute

• Crude palm oil / medium fuel oil blends as boiler fuel • Potential cracked hydrocarbon from palm stearin and

palm fatty acid distillate• Palm derived aviation fuel• Feedstock – palm oil, palm stearin, used frying

oil, PFAD, spent bleaching earth oil

First Generation Biofuel

Second Generation Biofuel• Biomass to Solid (BTS)

• Palm biomass briquettes • Biomass to Gas (BTG)

• Biogas capture and utilisationfrom POME

• Production of producer gas • Biomass to Liquid (BTL)

• Production of bio-oils • Production of Palm bioethanol• Production of synthetic diesel• Production of aviation fuel

Third Generation BiofuelAlgae (non-food feedstock for biofuels and bio-oil production)

Biodiesel Plant, Malaysia

Normal-grade Palm Biodiesel Plant

60,000 TPA

Winter-grade Palm Biodiesel Plant

30,000 TPA

Palm Biodiesel

Summer-Grade Palm Biodiesel

Pour point +15oC

Winter-Grade Palm Biodiesel

Pour point –21oC

Value Addition from Oil Palm Phytonutrients

Carotene

Vitamin E(Tocotrienols, tocopherols))

PhytosterolCo-Q10

Polyphenols

Squalene

Lecithin

Value Addition through Palm Phytonutrients:Phytonutrients from Palm Biodiesel

For every 1 tonne of methyl esters burnt as fuel, we also burn away:

0.6 kg Carotenoids0.8 kg Vitamin E0.5 kg Phytosterols0.4 kg Squalene0.05 kg Coenzyme Q0.06 kg Phospholipids

OR3

R2

OHR1

O

O

Hn

O

O

CH3

CH3

~USD 970/tonne

SC-CO2 Chromatography

Short Path DistillationSC-CO2 ExtractionReaction

Dry and Solvent Fractionation

MPOB INTEGRATED PHYTONUTRIENT PRODUCTION PILOT PLANTS

Tocotrienols• Antioxidant properties• Cholesterol lowering properties• Anti-cancer activities• Neuroprotective properties• Immune regulation

Carotenoids• Pro-vitamin A– solution to vitamin A deficiency• Anti-cancer effects• Anti-oxidant• Stimulation of the immune system• Cardiovascular protection• Prevention of cataract

Value Addition through Palm Phytonutrients

Commercial Products

PHENOLICS (2.4%)VitaminsFruit acidsFruit sugars

A tremendous opportunity to leverage on the 45 million tonnes of POME produced annually in

MalaysiaWaste to Wealth to Health

Value Addition through Palm Phenolics

BIOLOGICAL ACTIVITIES OF OIL PALM PHENOLICS•Antioxidant• Anti microbial • Anti atherogenic• Anti cancer• Anti diabetic• Anti hypertensive• Anti inflammatory• Anti obesity• Anti spasmodic• Anti thrombotic• Anti allergenic• Anti ulcer• Memory enhancing confirmed

In vitro, whole animal

and microarray studies

Research Focus Areas • Surfactants / biosurfactants• Polyols / polyurethanes• Cosmetics and personal care

products• Lubricants• Agrochemicals

Value Addition through Oleochemicals

Raw MaterialsC16 – C18 Fatty acids• Developed countries rely on

soya, corn, sunflower, rapeseed, tallow and lard

C12 – C14 (lauric oils) • All rely on SEA

Methyl Ester Sulphonate (MES) and Esterquats

METHYL ESTERS

SATURATED METHYL ESTERS

(C16/C18)

UNSATURATED METHYL ESTER

(C18:1)

WINTER GRADE -

BIODIESEL

FEEDSTOCK FOR MES AND ESTERQUAT

PALM OLEIN

Powder/ liquid detergent

Products from MES

Dish washing liquid

Palm-based Polyols

PALM OIL

EPO

POLYOLS

PALM-BASED POLYOL

HR FOAM VISCO FOAM RIGID FOAM

• Dimensionally stable• Moulded into various shapes and

designs• Light weight• Resistant to insects and fungus

attacks

Ornamental PU Products

Cosmetics and Personal Care Products

Some examples of the products developed

Color cosmetics

Transparent soap

Cosmetic pilot plant

Lubricants

• Rapid biodegradation• Non-toxic• Renewable resource• Good lubricity• High viscosity index

56

Hydraulic fluid

Metalworking fluidInsulation fluid

Addressing Peat EmissionPeat research

Peat ResearchInvestigate the use of tropical lowland peat for oil palmplantingActivities:

• SOP guidelines for OP cultivation on peat was published in 2011

• Classification of peat soil

• LCA study on oil palm cultivation on peat

• Carbon flux studies

• Biodiversity study for conversion of peat

• GHG emission study on drainage of peat

Outcome/Impact: To determine the sustainability of cultivation of oil palm on peat

Drivers for Innovations on Sustainability

• Growing consumer interest in environmental origin of goods

• Need to address customer demand for assurance on sustainable development– LCA is used tool to determine the

environmental sustainability

59

National LCA Project of Malaysia (2006-2010)

GOAL: To develop capacityand to conduct LCA leading toeco-design and improvedenvironmental performance ofproducts and services for thelocal and export market

MPOB LCA Projects:LCA for oil palm production: nursery to seedling, CPO, PKP/PKC, RPO, RPOs and RPOo, palm biodiesel, cooking oil, margarine, shortening, palm based soap, handling and transportation of palm products, α-methyl suphonates

Life Cycle Assessment (LCA)

LCA: a tool to evaluate theenvironmental performance ofa product or process throughits entire life cycle right fromcradle to grave

Calculation of GHG Emission Savings* (Based on MPOB Data)

Palm biodiesel pathway GHG emission savings (%)

Palm oil biodiesel (Without biogas capture) 50

Palm oil biodiesel (With biogas capture) 71

* Based on methodology as stipulated under EU Directive on the Promotion of the Use of Energy from Renewable Sources (2009/28/EC)

• Reviewed by independent international review panel and published in Journal of Oil Palm Research (JOPR) and International Journal of LCA

• MPOB offers LCA consultancy to the industry• Data submitted to Joint Research Centre, European

Commission and to Environmental Protection Agency, United States

LCA…

63

Importance of the LCA study to the oil palm industry

• Data from the study provide a referencefor stakeholders of the Malaysian oilpalm industry to improve environmentalperformance

• Fulfill environmental regulations relatingto trade of climate sensitive products

• Engaging in LCA is a key element forgaining credibility on sustainable claims

GHG Emission for Production of Palm Oil vis-à-vis Other Vegetable Oils

Source:* Yuen May Choo, Halimah Muhamad, Zulkifli Hashim, Vijaya Subramaniam, Chiew Wei Puah and Yew Ai Tan (2011).Determination of GHG contribution by subsystems in the oil palm supply chain using the LCA approach.International Journal of Life Cycle Assessment. DOI 10.1007/s11367-011-0303-9

** Mortimer, ND; Evans, AKF; Mwabonje, O and Whittaker, CL (2010) Comparison of the GHG benefits resultingfrom use of vegetable oils for electricity, heat, transport and industrial purposes. North Energy AssociatesLtd, February 2010

GHG Emission

*Refined palm oil(MPOB study)

**Refined Rapeseed

Oil

**Refined Soybean

Oil

tonne CO2eq/ tonne oil

1.11

0.63 (Biogas capture)

1.35 1.70

Water footprint – nursery to palm oil mill

• Water footprint of the production of 1 t CPO withthe system boundary from cradle to gate(nursery to palm oil mill) using the WFNmethodology*

• Results showed that palm oil has a lower waterfootprint as compared to soya oil.

• Development in the ISO standards on waterfootprint requires a methodology change –Quantis method

* Hoekstra et al. (2011)

Sampling Method Non-Destructive (t/ ha) Destructive (t/ ha)

Year planted (age) 2002 (11 yr) 1992 (21 yr) 1985 (29 yr) 1992 (21 yr)

Trunk 14.3 23.8 30.7 25.6

Frond 7.7 5.6 6.3 5.8

Frond Base 7 2.3 0.6 2.6

Cabbage / Spears 1.4

Inflorescence 0.1* 0.1* 0.1* 0.1

Trunk Bole 2.1

Root 22.5 11.0 31.9 10.0

Climber/ Epiphyte 0.6 0.2 1.2 2.1

Fruit Bunch 1.3* 1.3* 1.3* 1.3

Others 0.3

TOTAL 53.5 44.4 72.1 51.3

* Estimated based on destructive sampling, assuming that inflorescence and fruit bunch are invariant to the age of palm

Carbon stock of oil palm at different ages based on non-destructive and destructive samplings following

census conducted in 2013

CONTINUOUS IMPROVEMENT IN REGULATORY LIMIT FOR POME DISCHARGE

ParameterLimits According To Period of Discharge

1.7.1978 to

30.6.1979

1.7.1979 to

30.6.1980

1.7.1980 to

30.6.1981

1.7.1981 to

30.6.1982

1.7.1982 to

31.12.1983

1.1.1984 and

thereafter

Biochemical Oxygen Demand (BOD) 3-day, 30oC, mg/L

5000 2000 1000 500 250 100

Parameter Limit for Discharge into Water Course

Sustainability Implication:i. Biogas from mills contain 65% methane

and 35% carbon dioxide

ii. About 17 million tonnes of CO2 equivalent can be avoided

Methane from POME to produce electricityfor supply to the national grid or for theirown use

Capturing Biogas at Palm Oil Mills

Mills Completed with Biogas Plant by Year

010203040506070

2007 2008 2009 2010 2011 2012 2013 2014

No. of mills

Year

Addressing Externally Imposed Sustainability Requirements

Green procurement policy, sustainability certifications

• Business to business sustainability requirements, e.g. RSPO, green procurement policyo Purportedly to drive market

transformation by ensuring sustainability in the entire palm oil supply chain

• Government, e.g. EU Renewable Energy Directive (RED), US Renewable Fuel Standard (RFS)

Externally Imposed Sustainability Requirements

• Launched in August 2007 by Minister ofPlantation Industries and Commodities

• Seven Codes of Practice (CoP):• Good Practice for Nursery• Good Agricultural Practice for Oil Palm

Estates & Smallholdings • Good Milling Practice for Palm Oil Mills• Good Crushing Practice for Palm Kernel

Crushers • Good Refining Practice for Palm Oil

Refineries• Good Practice for the Handling, Transport

and Storage of Products from the Oil Palm• Good Practice for Bulking Installations

Codes of Practice (CoP)

MSPO• MSPO was endorsed by YB Minister MOSTI on

the 5 September 2013• YAB Deputy Prime Minister announced the

Malaysian Standard MS2530:2013 on 19November 2013

• MPOB had developed the certificationprocedure for MSPO, guidelines for auditing ofMSPO, requirements of certification bodiesand traceability (chain-of-custody).

• MSPO was approved for implementation bythe Cabinet in March 2014

• Continuous innovation through R&D effortsis critical for ensuring competitiveness andsustainability of oil palm

• Enhanced productivity, value-addition andsustainability strategies are vital to the oilpalm industry

• Palm oil will continue to be an integral partof the oils and fats industry

Conclusions

Thank You for yourkind attention

Email: choo@mpob.gov.myWebsite: www.mpob.gov.my