Malaysia is set to launch Used Cooking Oil (UCO) futures, reinforcing its commitment to the sustainability of the palm oil industry.
Industry expert David Ng of IcebergX Sdn Bhd highlighted that Malaysia generates around 540,000 tonnes of used cooking oil annually from palm oil and animal fats, which are the main feedstock for biodiesel production.
With increasing regulations such as the B20 standard and the upcoming B30 standard, which aim to promote renewable energy and reduce greenhouse gas emissions, demand for UCO is expected to surge, which is likely to drive up its price.
As the world’s leading producer of gross palm oil, the launch of UCO futures in Malaysia will strengthen its role in the sustainable aviation fuel (SAF) market and support the development of the local palm oil industry. Bursa Malaysia is currently seeking approval from industry stakeholders and regulators to finalise the new UCO futures contract in response to the growing demand for biofuel feedstock.