Hot Right Now: Malaysia palm oil grim outlook, Thailand cannabis regulations, Nestle predicts tough conditions and more feature in our round-up

Hard times ahead: Malaysia palm oil sector growth outlook grim due to labour, climate and economic woes​

The Malaysian palm oil sector believes there is little prospect of seeing market growth in the coming year due to labour, economic and climate challenges.

In a Pointers palm oil seminar hosted by the Malaysian Palm Oil Council (MPOC), CEO Wan Aishah binti Wan Hamid highlighted how these factors were hitting the sector.

This is especially so in terms of palm oil production, where the country has been hit hard by labour shortages ever since the COVID-19 pandemic onset in 2020, which has been compounded further by uncontrollable factors including weather changes.

“The acute labour shortage in Malaysia has led to lower palm oil production, made worse by the impacts of climate changes particularly excessive bad weather,”​ Wan Aishah said.

Cannabis commotion: Thailand tightens use of hemp and CBD in foods three months after decriminalisation​

The Thai government has announced new regulatory edicts specifying tighter regulatory control over the use of hemp and CBD in food and seasonings, just three months after announcing the decriminalisation of cannabis in the country.

In July this year, FoodNavigator-Asia​ reported that Thailand became the first country in South East Asia to formally legalise the use of cannabis for food-related purposes, after the Thai Ministry of Public Health (MOPH) announced that cannabis and hemp were delisted from the Category 5 list of narcotics in the Royal Gazette.

This legalised the planting, importing, consumption and also usage of these for use in food products, with the caveat that tetrahydrocannabinol (THC) content did not exceed 0.2%.

About three months on, MOPH has now issued several new edicts regarding the use of cannabis and hemp and cannabis in foods and seasonings, presumably to tighten regulatory control and ensure that these would not be misused for recreational purposes.

‘Tough conditions’: Nestle Malaysia predicts continued challenges as economic woes hit Q3 profits​

Nestle Malaysia saw its profits for the third quarter take a hit year-on-year due to rising commodity costs and poor exchange rates, with firm predicting that this challenging situation will not abate any time soon.

The firm recently announced its Q3FY2022 financial results alongside its nine-month performance for FY2022.

The nine-month performance results were positive, highlighting a 17.5% year-on-year increase in sales to RM5.02bn (US$1.06bn) in 2022 from RM4.27bn (US$904.2mn) in 2021, a 13.7% growth in domestic sales and 33.8% growth in export sales, and a 11.8% growth in Profit Before Tax (PBT) to RM676.1mn (US$143.2mn) as well as 6.5% to RM487.5mn (US$103.2mn) in Profit After Tax (PAT).

Nestle Malaysia has attributed these drops in profit to impacts from the ongoing current economic situation.

“We continue to contend with tough market conditions defined by high commodity prices and energy costs, in a challenging and volatile global environment,”​ Nestle Malaysia CEO Juan Aranols said in a formal statement.​

Dairy self-sufficiency in Asia: Baladna eyes more South East Asian markets after Malaysia success​

Qatari dairy giant Baladna is looking at more markets in South East Asia to bring its sustainable dairy self-sufficiency model to, after successfully securing and setting up its joint venture in Malaysia.

When we last spoke with Baladna earlier this year, the firm had just confirmed its dairy venture plans in Malaysia, to initiate operations by 2025 and produce 100 million litres of fresh milk annually within the first three years.

Several months on, the firm has firmed up more aspects of its business strategy and has stated that the initial focus will be on Malaysia’s liquid milk market.

“We’re primarily targeting the Malaysian liquid milk market [as] the self-sufficiency rate for liquid milk (fresh and UHT) in Malaysia is just 15% and it has been in decline for a number of years,”​ Baladna Founder and Managing Director Ramez Al-Khayyat told FoodNavigator-Asia​.

Poppy seed panic: Australian food firms stress poisoning cases ‘outside of brands’ control’ amid nationwide recalls​

Food firms in Australia affected by recent poppy seed recalls after an outbreak of severe food poisonings say the situation was beyond their control, amid government warnings that non-food grade poppy seeds ‘incorrectly’ entered the supply chain.

Australia has observed a series of severe food poisoning cases linked to poppy seed consumption, with over 30 consumers having been hospitalised and/or treated for high levels of thebaine, a toxic chemical found in non-food grade poppy seeds.