nkea agriculture moa executive talk

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Palm Oil

Agriculture

Rubber

NKEA AgricultureMOA’s Executive Talk30th March 2011

2

Agenda

Background of NKEA Agriculture EPPs

Brief Overview of EPPs

NKEA Agriculture Reflected in Minister KPI 2011 (MKPI 2011)

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PM introduced 4 strategic thrusts towards developed nation status

10th & 11th Malaysia Plan10th & 11th Malaysia Plan

People First Performance Now

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• 6 NKRAs • 29 MKRAs

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4

• 12 NKEAs• 131 EPPs• 60 Biz Opps

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4

Making us a rich country,

for everyone & for a long time

High-Income

Inclusiveness Sustainability

Target USD 15,000 GNI per capita by 2020

Enables all communities

to benefit from the wealth of

the country

Meets present needs without compromising future generations

Quality of Life

5

Comms Content &

Infra

Comms Content &

Infra

12 National Key Economic Areas (NKEAs)

11 Economic Sectors

+

Greater KL/

Klang Valley

Wholesale & Retail

Wholesale & Retail

Oil, Gas & Energy

Oil, Gas & Energy

Palm OilPalm Oil

HealthcareHealthcare

FinancialServicesFinancialServices

Greater KL/Klang

Valley

Greater KL/Klang

Valley

AgricultureAgriculture

TourismTourism

EducationEducation

Electrical& Electronics

Electrical& Electronics

Business Services

Business Services

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NKEA Agriculture focused on transforming the Agriculture industry into one with more focus on

Agri-business

Ensuring Food Security

Capitalising on Malaysia’s Competitive Edge

Trapping Premium Markets

Expanding participation in the regional value chain

Additional GNI: RM21.4 billionJobs created:

74,000

16 EPPs

11 Business

Opportunities

++

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EPP # EPP Title Project Owner

1 High Value Herbal Products Bhg. Industri Tanaman, Ternakan dan Perikanan

2 EBN Swiftlet Farming Jab. Perkhidmatan Veterinar

3 Seaweed Industry Jab. Perikanan

4 Integrated Cage Farming Jab. Perikanan

5 Further Integration in Oil Palm Jab. Perkhidmatan Veterinar

6 Replication of IZAQ Jab. Perikanan

7 Premium Market for Fruits and Vegetables Jab. Pertanian

8 Food Park Bhg. Industri Asas Tani

9 Fragrant Rice Variety MARDI

10 Strengthen Productivity of Paddy Farming in MADA MADA

11 Strengthen Productivity of Paddy Farming in Other Granaries Bhg. Industri Padi dan Beras

12 Expansion of Feedlotting Jab. Perkhidmatan Veterinar

13 Dairy Cluster Jab. Perkhidmatan Veterinar

14 Seed Industry Development Bhg. Khidmat Sokongan dan Pembangunan Industri

15 Participations of MNC Bhg. Khidmat Sokongan dan Pembangunan Industri

16 Overseas JV/Acquisition Jab. Perkhidmatan Veterinar

NKEA Agriculture Entry Point Projects

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A total of RM 18.7 billion is required to implement the EPPs

0

93

0

237

169

64

0

234

0

Replication of IZAQ

Paddy farming in MADA

Participations of MNCs

Paddy farming in other granaries

EBN Swiflet Farming

Premium market for fruits and vegetables

High Value Herbal Products

Integrated Cage Aquaculture Farming

Food Park / Incubator

Seaweed Farming in Sabah

Others (6 EPPs)

0.40

0.39

0.52

0.75

2.56

1.10

2.64

1.92

1.54

0.41

2.68

GNI/ Investment

3,152

2,666

1,943

1,830

1,773

1,422

839

720

576

3,251

525

Total RM juta

Investment requirement by EPPRM juta

Public funding

Private funding

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Target GNI of RM 21.44 billion will be achieved by implementing 16 Entry Point Projects (EPPs) and 11 Business Opportunities

2020 GNI contribution from top 10 EPPs (RM million)

2020 GNI contribution from top 10 EPPs (RM million)

High ValueHerbal

Products

Premium FFV

Seaweed Farming in Sabah

Integrated Cage

Aquaculture Sistem

Paddy Farming in other

Granaries

Replica-tion of iZAQ

Paddy Farming

in MADA

Biotech MNCs

EBN Swiflet

Farming

Food Park

Others *

* Seed Industry Development (RM 474 mil); Dairy Cluster (RM 326 mil); Cattle Feedlot (RM 183 mil); Cattle Integration with Oil Palm (RM 150 mil); Cattle overseas JV (RM 115 mil); Fragrant Rice (RM 99 mil)

2020 GNI contribution from top 10 Biz Ops (RM million)

2020 GNI contribution from top 10 Biz Ops (RM million)

Orna-mental

Fish

Herbal Product

Distributor

Aqua Feed Mill

Nutra from Other Herbs

FDI for Tropi-

cal Herbs

Free Range

Chicken

Mush-room

Project

Premium Snack

SFI Facilities

Aqua Export Center

Ready-to-eat

Jackfruit

RM 18 billionRM 18 billion

RM 3.4 billionRM 3.4 billion

▪ The top 10 EPPs add up to 93% of the incremental GNI

▪ The remaining EPPs have smaller GNI impact, but are important from:

– A food security perspective (e.g. beef and milk self-sufficiency)

– An inclusiveness perspective (e.g. new rice variety to improve yield and farmers’ incomes in non-irrigated areas)

▪ The GNIs generated from business opportunities are mostly below USD 0.26 billion, as there is a lot of element of uncertainties which calls for conservative assumptions to be used

Inclusiveness: Initiatives are spread out geographically to promote balanced growth

MD2 Pineapple contract farming clusters

Herbal cultivation park

Vegetable farming

Papaya contract farming clusters

Dairy farming clusters

Aquaculture

Paddy farming

Pitas

Tanjung Manis

Lingga/Banting and Bijat Stumbin

Pengagau

Sg Telaga

Sg Gum Gum

Tambisan

Bakun Dam

Batang Ai

Sg Padas and Sg Kalias

Kota Belud

Lanchang

Lojing

Rantau Manis

Cameron Highlands

Lenggong

Muadzam Shah

Mercong

Ulu Lepar

Selama

Mukim Mercung

Tg Batu

Merang

Mercang

Kuala Sanglang

Durian Mentangau

Pasir RajaCegar

Perah

Langkawi Tasik Pedu

Tasik Temenggor

Tasik Kenyir

Sungai Johor

Pulau Tioman

Keratong

Trolak

Swiftlet

Rompin

Ranau

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Steering Committee Chair: Lead Minister (MoA)

EPP level:• Meet fortnightly• EPP owners to

hold fortnightly status meeting with the PEMANDU Director & team

• Deputy Sec Gen (Planning) will oversee all EPPs

PM’s level:• Update PM once a quarter

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2NKEA Steering Committee• Meet once a month• EPP owners to provide updates• SC to make decisions and provides

guidance / direction to the team• SC to resolves conflicts• SC to oversees all other matters

related to NKEA

Secretariat:

PEMANDU/ Delivery

Management Office (MoA)

Members:• MoA KSU• KP Jab. Pertanian• KP Jab. Perkhid.

Veterinar• KP Jab. Perikanan

Prime Minister3

• KP MARDI• KP FAMA• Peng. Besar MADA• S/Usaha Tetap Sabah and Sarawak

Agriculture Ministry

Team 2: Horticulture &

Herbs ITTP Tanaman

Team 5: Food Park/Incubator:

IAT

Team 4: Livestock & Swiftlets:

ITTP Ternakan

Team 3: Aquaculture:

ITTP Perikanan

Team 6: Support:

KSI

Team 1: PaddyIPB

EPP 9: MARDI

EPP 10: MADA

EPP 11: IADA

Owner

EPP 9:

• Sime Darby

EPP 10:

• BERNAS

EPP 11 :

• Felcra

• Bernas

Implementer

EPP 1: MOAEPP 7: Jab. Pertanian

Owner

EPP 1 :

• ECERDC

• Biotropics

• IMR

• FRIM

EPP 7 :

• MAFC

Implementer

EPP 3, 4, 6: Jab.

Perikanan

Owner

EPP 3 :

• DOF Sabah

• UMS

EPP 4 :

• DOF

• PS

EPP 6 :

• DOF

• Blue Archipelago

• Private sector

Implementer

EPP 2, 5, 12,13, 16: Jab. Perkhidmatan Verterinar

Owner

EPP 2 :

• DVS and Private sector

EPP 12 :

• NFC

• Felda Global

EPP 13 :

• NFC

• Felda Global

EPP 16 :

• Private sector

Implementer

EPP 8: Bhg. Indus. Asas Tani

Owner

EPP 8 :

• FAMA

• MAFC

Implementer

EPP 14, 15: MOA

Owner

EPP 14, 15 :

• BiotechCorp

• MARDI

• DOA

• DOF

• DVS

Implementer

Head of DMO:KSU

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Agenda




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• Product development of nutraceuticals and botanical drugs based on 5 selected herbs – Tongkat Ali, Kacip Fatimah, Misai Kucing, Hempedu Bumi, Dukung Anak.

• Upstream supporting initiative of Herbal Cultivation Park for commercial production of raw materials undertaken by ECERDC in Pasir Raja, Chegar Perah & Durian Mentangau.

• 5 R&D Clusters of Excellence formed to co-ordinate the R&D for each research institution (RI) and research universities (RU) in respective clusters: Discovery, Crop Production & Agronomy, Toxicology/Pre-clinical, Product Development & Processing Technology

• Establishment of Herbal Development Council

EPP 1 : High Value Herbal Products

Scope of Public Funding 2011 Allocation 2012 Allocation

Development Expenditure:i.R&D Grantii.Building of admin & R&D complex, quarters and CPPC for Herbal Cultivation Parks in Durian Mentangau, Pasir Raja and Cegah Perahiii.Facilities upgrade for IMR

RM 73.0 million RM 82.4 million

Operational Expenditure:i. Establishment of Herbal Development Office


Project Details

2.2 2,000RM

billion

Jobs CreatedGNI Impact

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• Increase production of upstream by building of additional 2,000 new premises annually and 6 Collection Centres

• Improve monitoring and enforcement of Good Animal Husbandry Practice (GAHP), and Good Manufacturing Practice (GMP) for swiftlet premises and processing plants by incorporating traceability system

• Increase downstream product development and cleaning of more raw products locally by construction of R&D Centre for development and processing

EPP 2 : EBN Swiftlet Farming

4.5 20,800RM

billion



Development Expenditure:i.R&D Activity for Downstream Processingii.Acquisition of lab equipments for lab test on EBNiii.Enforcement and traceability system


Operational Expenditure:i.EBN Websiteii.Procurement of vehicles iii.Human Resourceiv.Rental for EBN Collection Centre


Project Details

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• Increase the yield and total production of seaweed to 150,000 MT in 2020 by clustering of farms

• Adoption of improved production methods by introduction of mini estate concept with technology-intensive land-based farming

• Downstream R&D&C to strengthen capability to process dry seaweed into high-value products (e.g semi-refined carrageenan (SRC) and alkaline treated chips (ATC)) as well as development for other uses of seaweed.

• Establishment of SPV, Green Leaf Synergy Sdn Bhd, a spin-off company under UMS to act as anchor company to SMEs.

EPP 3 : Mini Estate for Seaweed

1.4 13,000RM

billion



Development Expenditure:i.Construction of seaweed mini estate system and building of jetty ii.Establishment of R&D&C programme and pilot plant for product development


Operational Expenditure:i.Rental and operations of SPV

RM 1.82 million -

Project Details

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• Focus the aquaculture fish production for high-value species e.g seabass, grouper, tilapia to account for 28% of total production in 2020

• Upstream supporting initiative: establishment of quality broodstock development centres to reduce dependency on imported fries

• Mechanism of anchor companies to ensure integrated approach for large scale production from hatchery to processing phase.

• ZIA locations (e.g Tasik Kenyir, Tasik Bakun, Tasik Temenggor) has been identified for implementation.

EPP 4 : Integrated Cage Farming

1.4 10,100RM

billion



Development Expenditure:i.Basic infrastructure (e.g. jetties, access roads, main piping)ii.Broodstock centre (e.g. hatchery, quarantine facilities, multiplying centre)


Operational Expenditure - -

Project Details

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• Establishment of an aquaculture park with an average size of 1,000 ha dedicated to the organized production of high quality, fully certified shrimp for the premium market.

• Each IZAQ will be championed by an anchor company; SMEs and smallholders can participate through contract farming/profit sharing arrangement.

• Current model of IZAQ is being integrated in Setiu. Target to have 10 additional IZAQ by 2020.

• This concept can be replicated for other types of fish species e.g lobster, seabass

• Identified anchor companies: JEFI Aquatech, QL Resources

EPP 6 : Replication of IZAQ

1.3 12,000RM

billion



Development Expenditure:i.R&D and diagnostic lab (integrated facility for breeding programme)ii.Skills Development Centreiii.Infra for seawater intake, basic infra e.g. road access



Project Details

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• Production of 5 identified high-value non-seasonal tropical fruits: rock melon, starfruit, papaya, banana and pineapple; and intensify production of 3 high-value highland vegetables: lettuce, tomato and capsicum.

• Existing TKPM will be leveraged on for production of rock melon, starfruit and papaya. Identified TKPM includes Puncak Baring, Bukit Sapi, Sendayan, Lanchang, Inderapura, Kuala Lipis.

• Intercropping of oil palm and banana/pineapple will be adopted. Identified anchor: FELDA.

• Rehabilitation, intensification and consolidation of land to increase production of highland vegetable in Cameron Highland and Lojing I & II.

EPP 7 : Premium Market for Fresh Fruits & Vegetables

1.6 9,100RM

billion


Project Details


Development Expenditure:i.Cold room, 1 CPPC each for Papaya, Rock Melon, Carambola ii.Land clearing, road, water system, electricity, drainage for new TKPMiii.Land clearing & development, CPPC, settler houses, bridges & road, water supply, electricity, community hall, house of worship, clinic, MRL Lab in Lojing iv.Upgrade existing facilities, soil management and waste management


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• Development of integrated food park based on anchor company approach to co-ordinate SMEs and smallholders and produce in large-scale, fully accredited system.

EPP 8 : Food Park / Incubator

883.2 5,000RM

million



Development Expenditure- -


Project Details

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• Planting of fragrant rice variety e.g Jasmine-type and Basmati-type on a commercial scale on rainfed areas to improve average national yield, substitute import of fragrant rice and tap premium organic rice market.

• Identified anchor company for Jasmine-type MRQ76, Sime Darby, will be up-scaling the production of the variety from their pilot plant in Gedung.

• Identified anchor company for Basmati-type MRQ74, Infoculture Sdn Bhd, will be expanding the production of the variety from their farm in Langkawi to Lanchang.

• MARDI will support in the R&D for continuous development and production of new varieties of fragrant rice.

133 4,998RM

million



Development Expenditurei.Land preparations: Ploughing, rotovation, liming, harrowing, levelling, seedling process, transplanting process, field management process. ii.R&D for improvement of variety



Project DetailsEPP 9 :Fragrant Rice Variety for Non-Granary Areas

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• Improve farm management by introduction of the land amalgamation scheme to 500 ha per farm and providing incentives for traditional farmers to exit in Muda area.

• Accelerate technology use by introducing new varieties of seed and production/millin technologies as well as promoting larger scale mechanisation

• Intensification of infrastructure by improving the irrigation density in areas with high potential to increase yield

• Target of initiatives is to double the yield of paddy from the current 4.0 MT/ha to 8.0 MT/ha.

• MADA and BERNAS will co-establish an SPV to implement the initiatives in MADA

1.0 - 14,900RM

billion



Development Expenditurei.Incentives for farmers to exit landii.Irrigation for 10 blocks in MADA


Operational Expenditurei.Roadshows for promotion of land amalgamation schemeii.Establishment of SPV


Project DetailsEPP 10 :Paddy Farming in MADA

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• Similar model to MADA will be implemented in KADA.

• Develop 4,300 ha in Batang Lupar and 5000 ha in Kota Belud for double-cropping (focusing on areas with good soil – e.g. non peat areas) and include flood mitigation and water management system up to tertiary level.

• Establish entity owned by farmers’ cooperative and Government that will manage the paddy farming activities from upstream to downstream

• Establish R&D programme to improve yield of Sarawak rice varieties, improving drought tolerance, pest and disease resistance etc.

1.4 - 9,600RM

billion



Development Expenditurei.Incentives for farmers to exit landii.Irrigation in Batang Lupar and KADA iii.R&D for seed development in Sarawakiv.Irrigation infrastructure for other granaries



Project DetailsEPP 11 :Paddy Farming in Other Granaries

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• Establishment of 300 satellite farms to support the current anchor company, National Feedlot Corporation and other potential anchors for feedlotting operations.

• Anchor company will oversee the operations of the entire value chain while focusing on the integrated and consolidated downstream processing.

• Downstream operations will be improved by enforcing certification of abattoir, cold-chain delivery of chilled cuts, promoting market awareness of buffalo meat vs beef, and developing downstream (beef byproducts).

EPP 12 : Expansion of Feedlotting

182.4 2,000RM

million





Project Details

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• Establishment of dairy clusters led by anchor companies to produce milk on a large-scale basis and oversee the operations from production to marketing.

• Upgrading of the existing cold-chain milk facilities to ensure the quality of milk from farm to market is maintained

• Identified anchor players includes Dutch Lady Milk Industries, Evergreen Livestock, and Fonterra.

326 800RM

million



Development Expenditurei.Purchase of female animals to kickstart operationsii.Upgrading of farms for contract farmers under anchor companiesiii.Upgrading of milk processing facility



Project DetailsEPP 13 :Dairy Cluster

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• Introduction of Marker-Assisted Selection technology to produce progeny with desired traits e.g high-yielding, disease-resistant

• Establishment of National Seed Council (National Seed Steering Committee as interim structure) to oversee the development of seed industry in Malaysia to reduce dependency on imported seeds/breeding material

EPP 14 : Seed Industry Development

467 5,400RM

million



Development Expenditurei.Purchasing of equipment to complete laboratory (Market Assisted Selection technology)



Project Details

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• Attracting FDI in Agricultural Biotechnology into Malaysia contributes into multiple area that benefits the industry and develops highly skilled human capital

• Leveraging on Biotechcorp as the implementing agency. Biotechcorp will formulate the package necessary to secure FDI into the country.

EPP 15 : FDI in Agriculture Biotechnology

820 1,200RM

million



Development Expenditurei.Construction of facilities for companies

RM 15.0 million -


Project Details

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• Secure a consistent and affordable source of live animals for breeding, feedlotting, and dairy operations over the next 10 years

• Scope has been expanded to include other potential areas in agriculture e.g poultry with purpose of bringing in profit into the country

• Identified companies includes SEDC Sarawak, Intan Farm, Felda Global Venture Holding, NFC.

EPP 16 : Overseas JV/Acquisition

115.2 NilRM

million





Project Details

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Agenda




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Budget Allocated

GNI ( billion)1 1.5

100million

High

Low

Medium

Priority : Budget allocated vs GNI

2.0 2.5 3.0 3.5

EPP #1: RM 78.9/ 2.2 b

EPP #2: RM 8.4m/ 4.5 b

EPP #7: RM 80/ 1.5 b

EPP #4: RM 47m/ 1.3 b

EPP #3: RM 48m/ 1.4 b

EPP #6: RM 253m/1.3b b

EPP #11: RM 136/1.4 b

EPP #10: RM 99.6/1.0 b

EPP #15: RM 15/1.0 b

EPP #13: RM 32/0.3 b

EPP #14: RM 5/0.5 b

EPP #5: RM 31.4/0.5 b

EPP #16: RM 0/ 1.0 b

EPP #12: RM 0/0.1 b

EPP #9: RM 75/ 0.1 b

EPP #1: RM 0/ 1.0 b

EPP #8: RM 0/ 0.8 b

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NKEA: EPPs 40%

1. Expanding the production of swiftlet nest (EPP#2, Agriculture)

1.1 Total sales value for edible bird nest RM19.2 mil RM100 mil

1. Traceability, enforcement & certification

2. R&D of downstream processing and sustainable ranching

3. Implementation of Swiftlet Industry Guideline (1GP)

4. To set up EBN International Trading House

HHHY.B. Datuk Seri Noh OmarMinister of Agriculture and Agro-based Industry

2. Venturing into commercial scale seaweed farming in Sabah (EPP#3, Agriculture)

2.1 Tonnage of dried seaweed produced13,890 MT 16,580 MT

1. Establishment of Seaweed Industrial Zone

2. Establishment of farming system3. Downstream processing program

(product development)4. Establishing quality and standard

3. Farming using integrated cage aquaculture (EPP#4, Agriculture)

3.1 Total production of farmed fish 15,458 MT 19,458 MT

1. Site selection2. Feasibility study3. Gazetting of area4. Selection of anchor company

4. Replication IZAQ to tap market for premium shrimp (EPP#6, Agriculture)

4.1 Total export from IZAQ-

Still under construction

1. Feasibility study2. Identification & selection of site (2 sites)3. EIA submission & approval4. Construction

5. Upgrading capabilities to produce fruit and vegetables for premium markets (EPP#7, Agriculture)

5.1 Total export volume of premium fruits and vegetables

5.2 Intercrop Development (Banana)

5.3 Intercrop Development (Pineapple)

NA

Fruits & Vegetables14,000 MTBanana: 3,000 MT

Pineapple: 7,750 MT

1. Land preparation, nursery and infrastructure

2. Field planting3. Extension & advisory services4. Crop maintenance

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6. Scaling up and strengthening productivity of paddy farming in the Muda Area (EPP#10, Agriculture)

6.1 Total of land area amalgamated 0 ha 5,000 ha

1. Conduct feasibility study for SPV2. Develop implementation approach3. Seek consensus & gather response from

farmers & related parties on the proposed land acquisition & financial offer

4. Finalised land acquisition process and compensation involved

7. Strengthening anchor companies in cattle feedlots (EPP#12, Agriculture)

7.1 Ratio of domestic production vs total consumption1:3.4

46,510:162,357

1:3.351,161:170,475

1. Operationalised satellite farms 2. Construction of abattoir – under NFC3. Selection & appointment of other anchor

companies4. Completion of identified satellite farms (20

units)

8. Partnering with a large foreign dairy to establish dairy clusters in Malaysia (EPP#13, Agriculture)

8.1 Total production of fresh milk62.62 mil Liter 75.77 mil Liter

1. Implementation CDC Plan2. Development of farm infrastructure3. Development of pasture land4. Development of ruminant feed milling

industry9. Establishing a leadership position in regional breeding services (EPP#14, Agriculture)

9.1 Total production of seed 9.2 Total number of validations achieved

NANA

600 MT 10

1. Concept paper & approval for National Seed Council (NSC)

2. Formulation of Seed Act (crops, livestock & fisheries)

3. Setting up of Center for Marker Discovery & Validation (CMDV)

4. Establishment of National Livestock Breeding Center (NLBC)

10. Securing foreign direct investment in agriculture biotech (EPP#15, Agriculture)

10.1 Total sales from MNC’s products NA RM256 mil

1. Background study of strength & weakness of country in biofertilizer, biopesticides, flavor & fragrances area

2. Engagement with key stakeholders to bring in MNC

3. Identification & selection of a list of MNCs4. Initial engagement with MNC

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THANK YOU

nkea agriculture moa executive talk

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