HDC to play bigger role under MEA

SEOUL, The Halal Industry Development Corporation (HDC) will have a bigger role to play under the Economic Affairs Ministry (MEA), including empowering the nation’s halal industry by enhancing market space, producing more expertise in the field and increasing the number of homegrown companies.

Vice president Hanisofian Alias said it had also been tasked with establishing more industrial partnerships.

Our first task is to open up more markets. For example, we want to open up the South Korean market, either through the tourism industry or by cooperating in supplying raw material to companies in the country.

Of course, we want Malaysian companies to channel the materials, he told Bernama during a four-day working visit to the Seoul Food 2019 which began here today.

The event is organised by the Korea Trade- investment Promotion Agency (KOTRA).

In March this year, HDC signed a memorandum of understanding (MoU) with KOTRA, a state-funded organisation aimed at facilitating South Korea’s export-led economic development via various trade promotion activities.

PALM OIL PLAYERS NEED TO PUSH FOR MORE DOWNSTREAM PRODUCTS

According to Hanisofian, crude palm oil is one of the raw materials produced by Malaysia and demand for which can be expanded from among international companies.

Earlier this year, a MoU was signed between our plantation company FGV Holdings Bhd and South Korea’s ramen manufacturer, Samyang Foods Co Ltd. It allows FGV to supply its cooking oil, vegetable fats and sugar to Samyang Foods.

So, we can see that FGV is expanding its downstream business by diversifying product offerings and penetrating new markets. We would like to see more palm oil companies having this sort of industrial partnerships, he said.

He noted that local palm oil producers were merely satisfied with selling their upstream product, CPO, that had a big margin.

However, he hoped industry players, especially the big boys, would have learnt their lesson from the fall in CPO prices in November last year (resulting in lower margins) and start venturing into the downstream sector involving food ingredients and cosmetics as such.

In March, HDC announced that the total halal export value for 2018 dropped 7.6 per cent to RM40 billion from RM43 billion recorded in 2017.

The fall was largely contributed by two halal clusters, namely a 50 per cent decline in palm oil derivatives from RM3.6 billion the year before and a 36.7 per cent drop in industrial chemicals to RM357.77 million in 2018, from RM563.54 million.

HDC TO FOCUS ON RESEARCH AND DEVELOPMENT

Thailand is a country that does not have large oil palm plantations compared to us. But, it purchases our raw materials and conducts research and development (R and D), to produce more food products and also ingredients.

Manufacturers prefer those who can do R and D as they have the capacity to cater to their needs. Unilever and P and G for instance, have set up companies in Thailand since the country had its own R and D centre. R and D attracts investments, hence, this is where we are moving towards, Hanisofian said.

He said HDC was currently in discussions to strengthen its role.

Previously under the Ministry of International Trade and Industry, its direction now among others, is also more towards promoting trade and investment among small and medium enterprises (SMEs).

We always said our asset is knowledge, but how do we demonstrate that we are knowledgeable So, by leveraging on our expertise into more R and D, we can have greater focus on supply and demand.

To trace the demand, we can measure based on countries which we could work closely with, and the government agencies from each of those countries we are partnering.

The Philippines’ Department of Trade and Industry for example, has requested our expertise to assist its SMEs. So, we will try to help, but at the same time we want to study the Philippines market and how we can penetrate it, Hanisofian said.

HDC TO USE PARTNERSHIP WITH KOTRA TO SPEARHEAD R and D

He said the partnership with KOTRA would also be a platform for HDC to study the market needs among Koreans in terms of halal food.

Basically, when we talk about supplying halal food products there, it is not solely aimed at the locals, but also for companies to also market it in other Muslim countries, namely Saudi Arabia.

Next, with the number of Muslim tourists going to South Korea also increasing, we want to export more food products to cater to their needs, he added.

During the working visit, HDC is expected to sign another MoU with the Korea Institute of Halal Industry to further boost its R and D platform in the country.

Through the R and D, HDC would be able to assist South Korea’s Muslim hospitality sector.

So, the subsequent impact is that, we may bring in our services from the aspect of needed manpower, to provide training.

Secondly, there are a number of Malaysian-owned restaurants in South Korea, So, we can slowly introduce our products, especially those produced by SMEs, Hanisofian said.

Source: BERNAMA (News Agency)