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Malaysia's lucrative herb market

Published on: Saturday, December 28, 2013

Kuala Lumpur: The government has highlighted several core strategies for the country's economic growth in order to achieve the standard of a developed country by 2020. This includes the introduction of the 12 National Key Economic Areas.

The government believed in the potential of herbs in propelling the sustainability of the nation's Bioeconomy sector. In fact, herbs have been made into the first Entry Point Project (EPP1) for the nation's Agriculture NKEA.

In the beginning, the herb EPP1 was focused on the commercialisation of five types of herbs with the aim of producing high-value products totalling RM2.2 billion of the Gross National Income (GNI).

The five herbs are Tongkat Ali, Kacip Fatimah, Misai Kucing, Hempedu Bumi and Dukung Anak.

Today, six more herb species have been added to the project: mengkudu, roselle, ginger, Mas Cotek, belalai gajah and pegaga. The market potential of all 11 herbs are being studied and developed under the 10th Malaysia Plan.

Earlier this year, the Natural Resources and Environment Minister Datuk Sri Douglas Unggah Embas recommended the usage of herbs among Malaysians for medicinal purposes, food, healthcare and beauty.

When launching the Herbal Interactive Workshop in Simunjan, Sarawak, he impressed upon the importance of developing the herbal industry alongside the latest global development, where the trade value of the herb sector was expected to soar over RM2 trillion by 2020.

The estimated value is a threefold increase compared to the RM777 billion worth of trade in the herb sector in 2009.

On the local front, the ministry estimated the herb market to expand by 15 per cent a year from RM7 billion in 2010 to around RM29 billion by 2020.

Douglas also believed that the production of herb-based health food items could rake in lucrative returns as it made up around 35 per cent of the country's food and beverage market.

The Agriculture and Agro-based Ministry is confident of the herb industry's capability in contributing around RM2.2 billion to the GNI by 2020, as mentioned by former minister Datuk Seri Noh Omar in a seminar, last year.

The positive development of the industry is expected to create 1,800 job opportunities, 300 new herb entrepreneurs and increase income for some 1,500 of the nation's farmers.

Noh therefore proposed that farmers cultivate herbs or mixed crops on a large-scale basis, in order to achieve the nation's Agriculture NKEA goal.

To help them achieve the purpose, the government has prepared various forms of allocation for herb farmers and entrepreneurs. This includes a substantial amount of funding for clinical research grants on the 11 selected herbs, in the bid to obtain the United States Food and Drug Administration (USFDA) approval.

Among it is a local company that has been awarded a RM25 million grant to research Tongkat Ali.

Noh hoped that the aid would be fully utilised to ensure the herbal products manufactured in Malaysia would receive the green light of the USFDA to be marketed in pharmacies globally.

Data shows that herbal product demand has multiplied manifolds. Herbal health foods, for instance, have reached RM2,380 billion around 2001.

Prior to that, in 1996, the world herbal products are valued at RM950 billion, a drastic increase from only RM2,093.8 million in 1980.

However, the government's support of the application of herbal medicine can be seen dating back to 1997 with the opening of the Traditional and Complementary Medicine Unit at the Kepala Batas Hospital in Penang by the then Prime Minister, Tun Dr Mahathir Mohamad.

This also meant that it was a timely decision of the Malaysian Agricultural Research and Development Institute (Mardi) to give special focus to herb research as a new form of agricultural commodity.

In carrying out its responsibility of developing the nation's agricultural sector, Mardi has now adopted the approach of developing herbal crops with the potential to be turned into a commodity in the future.

Its target is to enable local entrepreneurs to venture into large-scale herbal planting that run into hundreds or thousands of hectares.

The herbal industry can also bring in new revenue streams for the country should present commodities like rubber, oil palm, pineapple and black pepper be threatened by stiff competition or suffer price drop.

The government has identified several areas to be developed into herbal cluster farms under the East Coast Economic Region Development Council (ECERDC).

This includes a 406-hectare land in Durian Mentangau, Dungun, a 327-hectare plot in Chegar Perah, Lipis and another in Rantau Manis Gua Musang measuring 323 hectares.

About a decade ago, discussions on the estimated value of commercial herbal products in the country revolved only around RM45 million.

This is based on the herbal market value recorded by the Perlis Forestry Department. In just 10 years, Malaysia has become bold enough to discuss figures amounting to RM2.2 billion. This is a clear reflection of the industry's potential, given factors like the variety of species available and favourable weather and soil conditions.

According to the 'Herba Warisan Alam' (The Nature's Heritage Herbs) pamphlet published by Rimba Herba of the Perlis Forestry Department, the export value of medicinal plants have increased to RM45 million in 2002 from RM17 million in 1990.

Aromatic plants, including ingredients for essential oil perfumes also proved to be of high economic potential.

Its export value has increased eight-fold to RM16 million in 2002 from RM2 million in 1990.

It is only natural then for the Forest Research Institute of Malaysia (FRIM), as a government agency, to continue developing its Natural Products Division since 1995. The division has succeeded in contributing significantly towards herb research through the latest bioassay techniques as well as chromatographic and spectroscopic techniques.

The focus of FRIM's research and development, among others, are on ethnobotany, good agricultural and collection practices, after harvest technology and herb processing. It helps increase the added value of nutritional plants that are being researched.

The government's commitment to realise the potential of herbs through FRIM is not limited to the research level.

FRIM has also introduced various technologies at its Herbal Technology Center to meet factory and industry needs.

The initiative by FRIM proves Malaysia's seriousness in optimising the global inclination towards natural ingredients, multiplying commercialisation efforts and elevating the status of the Malaysian herbal industry. - Bernama


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