Monday, 30 March 2009

North Americans consuming more palm oil

By Ooi Tee Ching Business Times, Malaysia

Published: 2009/03/31

Malaysian palm oil exporters are benefiting from the US recession, as cost-conscious Americans buy more ready-to-eat meals that are mainly cooked in palm oil and margarine.

Demand for palm oil is also rising when more authorities in the US ban artificial trans fats after medical tests linked it to heart ailments, Malaysian Palm Oil Council (MPOC) deputy chief executive Dr K. Sundram said.

“Artificial trans fat is proven to increase the risk of heart attacks and strokes. Many food companies in the US and Canada are voluntarily switching to natural palm oil and bakery fats that are trans fat free,” he said.

Sundram said many food companies choose palm oil because in its natural form, it can straight away be made into bakery fats. Palm stearin formulations, which can withstand high heat of 200°C, have good baking characteristics.

New York City started the ball rolling, and now California has also declared that by January 2010, all 88,000 restaurants in the state will be prohibited from using partially-hydrogenated soft oils that contain artificial trans fats.

“In view of California’s compliance deadline, we’re hopeful of more demand for palm oil and fats in the second half of this year. We should be able to export 1.1 million tonnes of palm oil to the US this year, 10 per cent more than last year,” Sundram added.

In a separate interview, IOI Group’s Loders Croklaan vice-president of research and development and marketing Dr Gerald McNiell confirmed that its operations in Chicago and Toronto are benefiting from these trends.

He said North American consumers are dining less often at restaurants, choosing instead to save costs by cooking at home. They buy more ready-to-eat meals, which are mostly cooked in palm oil and shortening.

Loders Croklaan’s non-hydrogenated, trans-free SansTrans brand was launched in 2003, and by 2006 more than 30 new products based on palm oil had been developed for the US market.

Last year, the company sold 250,000 tonnes of SansTrans in North America. McNiell hopes to increase sales by 10 per cent to 275,000 tonnes this year.

Since New York City’s ban on trans fat last year, Loders Croklaan has sold more SansTrans shortenings there to bakeries and restaurateurs for use in cakes, pastry, cookies, biscuits, candies, icing cream, pie crust, and pizza dough.

McNiell said these achievements were not easy, as palm oil in general had to overcome decades of negative perception and propaganda before it won over North America’s baking and confectionery community, and its customers.