PETALING JAYA: Sime Darby Oils International Ltd (SDO), a wholly-owned subsidiary of Sime Darby Plantation Bhd
, says the collaboration with Guangxi Beibu Gulf International Port Group Ltd (BGP) presents an opportunity for its palm oil products to be sold and distributed in major consumer areas, South China, South-West China and North-West China through the Qinzhou Port in China.
“With the growing demand for palm oil products and the increasing trade volumes between China and Malaysia, we anticipate that this partnership will promote growth of sustainable supply chain and spur greater demand for palm oil in China,” said SDO managing director Mohd Haris Mohd Arshad in a statement yesterday.
He noted a successful collaboration with BGP would be another milestone for SDO as it builds its position as the preferred supplier of certified-sustainable, high value palm oil products for the global market.
It was reported on Sunday that the parties had inked a memorandum of understanding (MoU) worth RM2.5bil.
This underscored the companies’ intention to collaborate in three major areas, which include to collaborate in leveraging on the port, logistics, trade and other advantages of BGP in the Beibu Gulf Economic Region to explore the possibility of establishing a shortening trading distribution centre in the Qinzhou Free Trade Zone of China’s Guangxi Zhuang Autonomous.
In addition, there will be utilisation of existing bonded warehouses as a refined palm oil trading and distribution centre in the Qinzhou Free Trade Zone and applying to become the delivery warehouse of the Dalian Commodity Exchange.
Both SDO and BGP also intend to fully utilise the preferential policies under the Guangxi Free Trade Zone for the said refined palm oil trading and distribution centre.
Also, both companies would be looking at marketing health products such as tocotrienol and red oil extracted from palm oil into China’s domestic market.
The MoU aspires for a combined target trading volume for shortening and refined palm oil of about 500,000 tonnes a year, the statement added.
Under the MoU, both companies intend to collaborate for a period of one year, after which an extension of the collaboration may be considered subject to mutual agreement.
