Subsidised cooking oil misused for profit
PETALING JAYA: Although only used cooking oil (UCO) is meant to be collected for biodiesel production, some collectors are openly purchasing unused cooking oil, raising concerns about subsidy abuse and profiteering.
'We can buy it from you, whether it's used or not. The oil doesn't need to be mixed either. We will just collect it,' said a collector based in the Klang Valley.
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Checks with another collector in Selangor revealed similar practices.
'As long as there's no water in the oil, it can be sold,' the individual said.
UCO prices vary depending on market demand, ranging from RM2.50 to RM4 per kg.
However, this price window has also created opportunities for illicit gains, especially when subsidised cooking oil, sold at RM2.50 per 1kg packet, is falsely passed off as used oil.
Subsidised cooking oil is limited to three packets per customer.
Yet industry insiders say some collectors, especially those with access to subsidised oil quotas, may be taking advantage of the system.
'Some retailers may hoard subsidised oil and sell it at inflated prices,' one insider revealed.
'A carton can go for around RM51, meaning each packet costs about RM3, still cheaper than unsubsidised cooking oil, which sells for about RM6 per kg.'
Another industry player raised concerns over the number of informal collectors operating in the market.
'People have the right to earn a living, but buying subsidised oil and reselling it at higher prices, that is something else,' the industry player said.
According to the Association of Used Cooking Oil Development Malaysia, UCO is typically collected in bulk and transported to licensed depots for pretreatment before being sent to biodiesel manufacturers for conversion.
The International Sustainability and Carbon Certification guidelines state that the degraded properties of UCO make it particularly suitable for specific biodiesel production processes.
In contrast, unused or virgin cooking oil is not classified as waste, and its use in biofuel manufacturing undermines sustainability goals of transforming actual waste into energy.
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