KUALA LUMPUR, Feb 25 (Bernama) -- The progress in replanting oil palm trees is still lagging, with Malaysia managing to replant 114,000 hectares, or 2.0 per cent of its total planted area in 2024, down from 132,000 hectares (2.3 per cent) in 2023.
Plantation and Commodities Minister Datuk Seri Johari Abdul Ghani said this was below the recommended annual target of 4 to 5 per cent, or approximately 285,000 hectares per year.
He said increasing yield is pivotal to securing the palm oil industry’s longevity, and the government has made replanting a priority to boost productivity without expanding land use.
“Replanting is a critical issue that must be tackled immediately, as it directly impacts the industry in the long run.
“To secure future yields, this long-term commitment must begin now to ensure the continued growth and resilience of the sector. This is especially important as Malaysia has committed to ensuring that no further deforestation will take place due to palm oil,” he said in his keynote address at the 36th Palm and Lauric Oils Price Outlook Conference (POC 2025) today.
The minister said that while efforts to increase replanting rates are being intensified, it is crucial to ensure that only high-quality planting material is used.
“As many of you know, smallholders remain a significant but vulnerable group in the palm oil industry due to a lack of scale. Thus, they may be susceptible to dishonest practices by certain nurseries.
“The government will continue to focus on protecting the interests of the industry as well as the over 450,000 smallholders. To ensure that only high-quality seeds are used in replanting efforts, the government, through the Malaysian Palm Oil Board (MPOB), will conduct random checks to ensure that nurseries are selling the right product,” he said.
To address challenges such as ageing palm trees and stagnant yields, he said KPK is working closely with the Ministry of Finance to increase grant assistance for oil palm replanting and streamline the application process for smallholders.
“Other growers and players along the supply chain are also eligible for numerous tax incentives, such as Investment Tax Allowance (ITA), Reinvestment Allowance (RA), Green Technology incentives, and various others, reflecting Malaysia’s commitment to supporting all stakeholders in the industry,” he added.
On artificial intelligence (AI) in the palm oil industry, Johari said the sector cannot shy away from new technologies and must fully embrace advancements to remain competitive.
“The use of AI in production processes is essential, as it can boost efficiency, reduce reliance on foreign labour, and ensure the highest standards of quality and sustainability.
“Recently, I visited one of the top palm oil mills in Kuala Kangsar, which operates at a capacity of 45 metric tonnes per hour. They introduced me to an AI-powered system that significantly enhanced their operations. By integrating AI, they achieved savings of approximately RM2.7 million annually,” Johari said.
He said the savings stemmed from reduced oil losses, lower maintenance costs, and a 33 per cent reduction in manpower requirements.
“I strongly encourage industry players managing the 453 palm oil mills in Malaysia to explore and adopt this technology. The cost of implementation is approximately RM5 million per mill, but with the potential savings and efficiency improvements, the return on investment is well justified.
“This is a crucial step in increasing yield and reducing operational costs. By adopting AI-driven solutions, we can enhance productivity without expanding land use, ensuring that Malaysia’s palm oil industry remains competitive and sustainable in the global market,” he added.
-- BERNAMA
