PALMOILMAGAZINE, KUALA LUMPUR – Malaysia is set to strengthen governance of used cooking oil (UCO) by introducing an official benchmark price in the first quarter of 2026, a move aimed at creating a more transparent, fair, and sustainable market.
The policy was announced by Malaysia’s Minister of Plantation and Commodities, Datuk Seri Dr Noraini Ahmad, who said the benchmark would serve as a clear pricing reference for market participants while reinforcing healthy trading practices. The government also sees the measure as crucial to protecting small-scale players from price manipulation and potential fraud.
“This benchmark price will provide clearer guidance, support fair trade, and protect small players from price manipulation and fraud,” Noraini said, as quoted Palmoilmagazine.com from Bernama on Wednesday (28 January 2026).
She noted that UCO is playing an increasingly strategic role in Malaysia’s circular economy transition, transforming waste into valuable feedstock for downstream industries. Demand for UCO continues to grow, particularly for biofuels and palm-based chemical products.
“Used cooking oil plays an important role in this transition, especially for downstream applications such as biofuels and palm-based chemical products,” she said.
Noraini added that the Malaysian Palm Oil Board (MPOB) is intensifying governance measures, including traceability systems and market supervision, to ensure UCO is managed more safely and in an orderly manner. These steps are part of broader efforts to build a more structured UCO market and strengthen sustainability standards across Malaysia’s palm oil sector.
She also outlined developments in Malaysia’s crude palm oil (CPO) market over 2025. Average CPO prices rose 2.7% year-on-year to RM4,292 per tonne in 2025, up from RM4,179 per tonne in 2024. Export revenue from palm oil and related products is estimated to exceed RM100 billion, supported by CPO production nearing 20 million tonnes.
“This is a strong performance. From the government’s perspective, our future competitiveness depends on three key pillars: higher productivity, stronger sustainability assurance, and faster adoption of innovation,” Noraini said.
Looking ahead to 2026, she expressed optimism about Malaysia’s palm oil outlook, while stressing that the industry must strengthen productivity, sustainability, and adaptability simultaneously to remain competitive globally.
Policy direction, she said, is no longer focused solely on volume growth, but increasingly on quality, sustainability, and traceability. The government will continue to reinforce assurance systems to ensure Malaysian palm oil remains credible and competitive in international markets.
“I am confident the Malaysian palm oil industry has a strong and resilient future. Growth must go hand in hand with sustainability, inclusivity, and innovation,” Noraini said.
She also emphasized the importance of close collaboration among the government, industry players, researchers, and smallholders to ensure the sector’s transformation proceeds in a solid and coordinated manner. (P2)
