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US may buy more Malaysian palm oil

PETALING JAYA: The United States may buy more palm oil from Malaysia, now that the Food and Drug Administration (FDA) has
dropped trans fats’ “Generally Recognised as Safe” (GRAS) status.

Last month, US FDA Commissioner Margaret Hamburg reportedly said her agency had preliminarily determined that partially hydrogenated oils, a major source of trans fats in processed foods, are not generally recognised as safe for food. 

Trans fats have been linked to an increased risk of coronary heart diseases, in which plaque builds up inside the arteries and may cause a heart attack. She called the agency’s announcement “a critical step in the protection of Americans’ health”. 

Traditionally, food companies add hydrogen gas to soft oils, in a process called hydrogenation, to make them more solid or spreadable, prolong shelf-life and maintain flavour stability. But, the side effect of this process is trans fats. 

“Since palm oil is naturally semi-solid at room temperature, it is an ideal substitute for trans fats. 

“We expect food companies in the US to place more orders for palm oil, a heart healthy and yet versatile food ingredient,” said Palm Oil Refiners Association of Malaysia (Poram) chief executive officer Mohammad Jaaffar Ahmad. 

Currently, the US buys around a million tonnes of palm oil from Malaysia. Since 2006, the FDA has passed a compulsory ruling on trans fats labelling. This prompted the food companies there to turn to palm oil to phase trans fats out of their products. 

“The latest FDA ruling bodes well for palm oil exporters. We estimate a possible upsurge of up to 200,000 tonnes of palm oil shipment from Malaysia to the US,” he told Business Times, here, recently. 

Meanwhile, on policy development in the EU, Jaaffar noted that starting next year, Malaysia and Indonesia will be competing on a level playing field when exporting palm oil, oleochemicals and biodiesel to the continent. 

“Starting next month, oleochemical and biodiesel shipments from both Malaysia and Indonesia will be subjected to the usual import tax when they reach EU shores. “These are items categorised under Chapters 34 and 38,” he said. 

Earlier this year, there was confusion as to whether Malaysia may be getting the short end of the stick since next year onwards, it will graduate from the Generalised System of Preferences (GSP) status with the EU with regard to Chapters 34 and 38. 

Jaaffar said Malaysia began to graduate from GSP status back in 1999. It started with Chapter 15, which listed crude palm oil, crude palm kernel oil and all refined palm oil. 

“Since then, we’ve been paying the usual import duties on shipment of products listed under Chapter 15 to the EU,” he said. “All the while, Indonesia had been enjoying GSP status with the EU. But starting 2014, Indonesia will graduate from Chapters 15, 34 and 38, too.” 

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