Export earnings from cocoa beans and products rose significantly, reaching RM12.09bil from January to October 2024.
KUALA LUMPUR: Cocoa and pepper continued their upward performance in 2024 driven by higher global demand and the government’s support towards the growth of the crops.
Both commodities remained key contributors to Malaysia’s economy, with notable increases in export values recorded this year.
According to the Plantation and Commodities Ministry, Malaysian pepper exports reached RM86.4mil from January to July 2024, compared with RM80.2mil recorded during the same period last year.
Meanwhile, export earnings from cocoa beans and products rose significantly, reaching RM12.09bil from January to October 2024, compared withRM8.20bil in the corresponding period last year, according to the Malaysian Cocoa Board (MCB).
This increase was primarily driven by higher production output and a stronger ringgit in 2024.
The MCB highlighted that one of the main drivers of the positive performance in 2024 was the significant rise in cocoa bean prices, ranging from RM20,000 to RM27,000 per tonne, which was more than double the average price of RM10,000 per tonne last year.
The price increase has sparked renewed interest among estate owners and smallholders in cocoa planting, prompting efforts to rehabilitate existing cocoa fields and boost production.
“The export earnings from semi-finished cocoa products and chocolate reached RM10.3bil from January to September 2024 , surpassing last year’s total of RM8.2bil ,” the board told Bernama.
However, the board also noted challenges in the industry, particularly the heavy reliance on imported cocoa beans
It said 99% of beans processed by local grinders were imported beans valued at RM 12.6bil from January to September 2024.
“To address this dependency, the MCB launched a bean-sourcing mission earlier this year,” it said.
The MCB expressed concerns about the potential impact of the European Union Deforestation Regulation (EUDR) on cocoa exports, particularly to European markets.
To meet the EUDR requirements, the MCB has developed a traceability system that tracks cocoa beans from cultivation to chocolate production and is implementing various initiatives to support the production of premium cocoa beans.
In collaboration with the Malaysia Space Agency, MCB is leveraging geospatial data and remote sensing technology to enhance the efficiency of cocoa-farm monitoring.
On low cocoa bean production, the MCB will assist smallholders by providing advice and training on adopting technology, smart-farming methods, good agricultural practices, and the distribution of agricultural inputs.
The board is also working to resolve bottlenecks in import procedure at ports by engaging relevant authorities to streamline the importation of cocoa beans.
While higher dry cocoa bean prices have benefited farmers, they have also led to a two to threefold increase in the cost of cocoa-based products such as chocolate.
However, with consumer preference for premium chocolate, such as single-origin chocolate and healthy functional chocolate, the demand for cocoa-based products will remain high despite the high prices.
The ministry highlighted that a stronger ringgit could lower the cost of importing agricultural inputs, thereby lowering production expenses for smallholders and increasing their profit margins.
However, fluctuations in the ringgit’s value have a limited direct impact on the incomes of smallholders, as cocoa production primarily serves domestic markets to meet the demands of local processing factories.
Farmgate cocoa prices in Malaysia are mainly influenced by global supply and demand trends, rather than changes in the exchange rate.
Deputy Plantation and Commodities Minister Datuk Chan Foong Hin highlighted the significant demand for Malaysian pepper.
The Japanese market alone accounts for nearly 50% of the country’s pepper exports.
Chan also noted encouraging trade with Singapore, where pepper exports rose to 368.1 tonnes valued at RM8.20mil during the first seven months of this year, compared with 288.44 tonnes worth RM5.86 million in the same period last year.
“Singapore is an important trade partner for the pepper sector, offering vast growth potential based on economic and trade relations with Malaysia as well as geographical factors,” he noted.
Additionally, he pointed out that pepper cultivation in Malaysia expanded to 8,215ha in 2024 up from 8,172ha last year.
