Worker woes may hit palm oil earnings

Malaysia could lose billions of ringgit in palm oil export earnings if a serious labour shortage in Sabah continues, industry officials say. The plantation sector in Sabah, Malaysia's most productive palm oil producer, has seen its workforce fall by a fifth recently, Malaysian Palm Oil Association (MPOA) chief executive Datuk Mamat Salleh said.

Checks with plantation companies revealed that more than 10 sizeable oil palm estates in the state did not have enough workers because those who had gone home to Indonesia for the Hari Raya Puasa and Haji holidays did not come back.

The main reason was that estates in Kalimantan were paying the same wages offered in Sabah, Mamat said.

"If foreign workers, comprising half of the 600,000 workforce in the palm oil industry, are reduced by 30 per cent, our country's palm oil export earnings could shrink as much as RM10 billion a year," he told Business Times in an interview.

Sabah produces seven million tonnes of palm oil a year, or 40 per cent of the national output.The palm oil industry earned a record RM65 billion in export earnings last year, thanks to high prices.

Two months ago, East Malaysia Planters' Association (Empa) chairman Othman Walat reportedly said that oil palm planters in Sabah and Sarawak might recruit workers from China, Bangladesh and the Philippines to make up for the shortage of Indonesian workers. However, other industry officials felt that it was easier said than done as other nationals did not prefer working on the estates, while Malaysians were under the mistaken assumption that the job did not pay well.

"But plantations these days are offering productivity-based salaries. A harvester, for instance, can earn between RM1,500 and RM2,000 a month, depending on the quantity and quality of fruit bunches he harvests."A family of three working together can earn up to RM3,000," Othman said.

Furthermore, the job offers housing, uninterrupted supply of electricity and piped water, medical, schooling and recreation facilities free of charge by the estate owners. These are now enjoyed by the foreign workers.

While, the MPOA understands and fully supports the government policy to employ more locals and enhance mechanised harvesting on the estates, the reality is far from expectations. Mamat said that young locals entering the labour market were just not interested in menial jobs like the harvesting of oil palm fruits.

"We do not want to be too dependent on foreign labour, but do we have any other feasible and practical alternatives?" he questioned.

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