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The National Biomass Strategy 2020 lays the foundations for Malaysia to capitalise on its biomass by channelling it into higher value downstream uses.

The strategy identifies opportunities by which Malaysia can achieve significant additional contribution to GNI, increased wealth and job creation from its palm oil sector.

It provides a 2020 oil palm biomass to wealth scenario, which will drive the development of national clusters in the bio fuel and bio based chemicals industries as well as fulfil the national renewable energy target for biomass to energy.

Malaysia could benefit from an additional RM 30 billion contribution to GNI by utilising the biomass from the oil palm industry for higher value-added downstream activities.

This would result in more and better jobs for Malaysians, as the country would begin producing high-value products out of a resource that is currently little used in advanced industries in Malaysia.

Different uses for biomass have very different risk-return profiles, given different technological maturities, global demand potential and competitive dynamics. Malaysia already benefits from producing wood products and animal feed today.

Biomass-to-energy plants are being built to take advantage of the Feed-in-Tariff. Moreover the first pellet plants, which will allow the export of oil palm biomass, are currently being set up.

The bigger prize is in higher value, higher risk applications. Producing bio fuels and bio based chemicals from biomass would offer increased wealth as well as new and better jobs.

However, the technologies to convert lignocelluloses biomass into bio fuels will only be available on a commercial scale between 2013 and 2015.

An additional 3–5 years of optimisation of this technology platform will be required for cost-competitive production of bio based chemicals.

The development of research and commercial capabilities as well as the know-how to convert lignocelluloses biomass into sugars will allow Malaysia to tap into the high-value opportunities in bio based chemicals.

Biomass in Malaysia

  • Current expectation on world palm oil consumption is significantly rising.
  • Malaysia is the second largest Crude Palm Oil (CPO) producer.
  • Palm Industry is the main contributor to biomass sources in Malaysia, and projection show rising capacity. Current annual oil palm biomass generation is estimated to be 80 million metric tons.
  • Examples of current utilization of oil-palm biomass include composting, pulp and paper industry, wood industry, and animal feedstock.


  • Migration from bio fuels to biochemical in view of huge market potential. Bio-based chemicals market share in the global chemicals market are expected to increase from 9-13% in 2010 to 22-28% in 2025 (USDA; USA Bio based Products Market Potential & Projections through 2025). Locally, Malaysia’s biochemical share in Malaysia’s chemicals sales target is projected to increase from 5% in 2010 and 20% in 2020 (McKinsey & Co, 2011).
  • Backward integration by companies to secure renewable feedstock and forward integration with chemical companies for marketing.
  • Opportunity for significant economic value from oil palm by utilizing waste generated at plantation and mill level for production of higher-value bio-based chemicals (Biotechnology Corporation Sdn. Bhd., 2011).
  • Green Chemistry trend such as minimizing waste in chemical production processes, going for less toxic alternatives in place of existing products, and the shift to renewable fossil-fuel-replacement feedstock (Pike Research, 2011).
  • The current size of the green chemical industry is about USD 2.8 billion globally. In 2015, it will likely grow to about USD 11.0 billion and nearly USD 100 billion in 2020 (Pike Research, 2011).

Source: National Biomass Strategy 2020, Malaysian Biomass Initiatives, mybiomass.com.my, biomass-sp.net and greenworldinvestor.com


(this article written for 1BINA.my)