Basically in Malaysia, there are only 2 out of 5 sugar factories, which use sugar cane as raw materials for refined sugar production. The other plants would use solely brown sugar as raw materials for sugar production. The main objectives of the industry are for food security supply, creation of jobs, development of industrial projects in rural areas and reducing foreign exchange.

Bagasse is the residue after sugarcane has been processed to remove the sugar juice. On average, about 32 % of bagasse is produced from every tonne of sugar cane processed. The amount of sugar cane processed in 2002 is about 1,111,500 tonnes. Thus, the amount of bagasse produced is 355,680 tonnes. This bagasse is not wasted as it acts as a biomass residue fuel to the boiler for its cogeneration plant. This saves the factory expenditure in boiler fuel oil and electricity expenses.

At the current rate of usage, all of the bagasse is used as fuel for its cogeneration plant. In fact there is insufficient bagasse for the sugar mills. Thus, they are buying other biomass residues such as rice husk, wood off cuts and palm oil residues to be used as fuel.