Bernama.com (Malaysian National News Agency), 20 March, 2007

Sarawak Mulls Integrated Sago Processing Mill For Ethanol

KUCHING, March 20 (Bernama) -- Sarawak is looking into the feasibility of setting up an integrated sago processing mill to produce ethanol as biofuel as part of the sago industry downstream activities.

Land Custody and Development Authority (LCDA) general manager Abdullah Chek Sahamat said Tuesday the mill is expected to be set up in one of the four sago smallholder satellites comprising Dalat, Mukah, Balingian and Pusa by next year.

LCDA is a state statutory body taking the lead in spearheading the development of the industry's development initiatives.

"Our target is to diversify the uses of sago by minimizing and recovering the existing wastes, which are being discarded at the moment, into revenue-generating by-products," he said after giving a briefing to a delegation from the Information Ministry Coordination Committee led by Sarawak information director Resat Salleh here.

He said based on the current processing technology, only about 30 percent of the sago body mass is recovered as starch or revenue while the remaining 70 percent of fibrous and woody components is disposed as waste.

Abdullah said a group of Japanese researchers had indicated that the state would need to have 50,000 hectares of matured and fully commercialized sago production areas to support a feasible ethanol production plant with a capacity of 300,000 metric tonnes annually.

Under the satellite estate development, LCDA, through its research and development subsidiary, Crop Research and Application Unit, will cover the 50,000 hectares of the existing holdings involving about 8,700 sago farm families in the four areas under the Ninth Malaysia Plan period.

"Under the concept, the smallholders' farms will be consolidated and thus rehabilitated to form the clusters, sizing about 500 hectares each and provided with all the necessary infrastructure and proper management system," he said.

Abdullah said currently the smallholder's family earned about RM1,050 per hectare annually while through the consolidation and commercial management of their farm would immediately raise their income to RM1,500 per hectare annually and then to RM5,250 per hectare annually within the next six to seven years after the project implementation.

The current productivity was also considered very low at 15 logs per hectare yearly as compared to the industry potential of 70 to 100 logs per hectare per year, Abdullah said.

In terms of production, the consolidation has the potential of producing a total of 300,000 to 400,000 metric tonnes of sago flour annually, about 600 to 800 percent higher than the existing output of 47,000 metric tonnes per year, he said.

By 2015, the state's revenue from the sago industry is expected to increase to RM2.5 billion per year from RM36 million at present, he added.

Abdullah said LCDA was also considering the outsourcing of sago flour supplies from overseas, especially from major sago-growing areas such like Papua in Indonesia and Papua New Guinea.

"A feasibility study will be carried out to determine the potential for LCDA to establish processing plants in those regions so as to undertake further downstream processing back home in Malaysia for greater value gains," he said.

The main prospect for sago is for food and industrial-starch based developments as its flour has the unique characteristics of starch that can be made into food, pharmaceuticals and modified starch for biofuel, including ethanol.

-- BERNAMA