Sarawak to increase oil palm production

By Nigel Edgar
KUCHING: Sarawak, the “last frontier of oil palm development in Malaysia”, aims at producing 20 million metric tonnes of oil palm fresh fruit bunch (FFB) per year within the next five years from the current 16 million metric tonnes.

Malaysian Palm Oil Board (MPOB) Sarawak regional head, Sulim Lumong, said the government has a long term plan to achieve that target by expanding plantation areas in the state to 1.2 million hectares within five years or one million hectares by 2010. “As of August this year, Sarawak had 744,371 hectares of plantation,” he said when interviewed by The Borneo Post on Wednesday. “We are aiming for 1.2 million hectares within the next five years, thus increasing our fresh fruit bunch harvest from 16 million metric tonnes per year to at least 20 million metric tonnes in five years,” he said.

Five metric tonnes of FFB could produce about one metric tonne of crude palm oil (CPO) and Sarawak is now producing 1.86 million tonnes of CPO with the current price at around RM2,000 to RM2,100. The number one oil palm producer in Malaysia is Sabah which currently produces about 23 million metric tonnes of oil palm fresh fruits harvest per year.

Sulim also pointed out that the time frame of five years was in tandem with the development of the Sarawak Corridor of Renewable Energy (Score). “Our focus area at the moment is Bintulu, Sri Aman and Sibu. Sarawak is the last frontier of oil palm development in the country because land resources in the Peninsular have depleted while in Sabah it is reaching its plateau,” Sulim said. “The government has identified potential areas and corridors suitable for oil palm cultivation in the state - about 3.9 million hectares.”

The oil palm corridors according to their priority is the Miri-Bintulu Corridor which is currently the main focus; the Tatau-Sibu corridor; the Sibu-Sri Aman corridor; and areas south of Kuching near the Indonesian border. About 600,000 hectares are State land; 400,000 hectares are Native Customary Rights (NCR) land; 1.29 million hectares are alienated land; while the rest would be small time planters.

Chief Minister Pehin Sri Abdul Taib Mahmud had said at the Agronomic and Practices of Oil Palm Cultivation (ACT 2008) Seminar last year that the corridors when fully implemented would be able to generate RM10.8 billion a year in exports for the state. Sulim pointed out the northern region if the state is most active in the industry with Miri having 246, 821.21 hectares of plantation followed by Bintulu (141,286), Mukah (129,528), Samarahan (55,612), Sibu (54,852), Kapit (41,240), Sri Aman (35,284), Kuching (33,814), Betong (25,370), Limbang (12,638) and Sarikei (8,431).

He also said MPOB Research Centre in Sessang, Betong - the only one operational in the state at the moment - is putting up extra effort to meet the ever growing needs of the industry.
“The first quarter of this year, three million seedlings were imported from the Peninsular and Sabah into the state. “We have to import most of the seedlings because at the moment we (Sarawak) only have one operational research centre,” he said.

When asked on the prospects of palm oil industries in Malaysia, Sulim said it is increasing every year as demand of oils and fats increases due to population growth and income per capita.
“Palm oil share is expected to increase in terms of export market share; investments in palm oil are expected to increase especially in Sabah and Sarawak around the palm oil industrial cluster (POIC); and CPO and crude palm kernel oil (CPKO) production is increasing. “There is also a potential in Sarawak to export to nearby Kalimantan and Far East. There is also the setting up of a Halal Hub in Tanjung Manis in Mukah where Malaysia would conduct global halal activities including palm oil products to Muslim countries,” he said.

With all the prospects and opportunities, there are also challenges faced by the industry, said Sulim. “Feedstock prices (CPO and CPKO) are volatile which makes it hard for investors to estimate income. There are also Non-governmental Organisations (NGOs) bringing up issues that could hinder the industry’s development, pointing out its impact on environment,” he explained. Another challenge he added was competition in the world market especially from Indonesia - a low cost producer country.

To further boost the industry, Sulim said the government has come up with several policies and strategies. “The government provides infrastructures such as new coastal highways and port facilities, apart from the Joint-Venture NCR Land Development model to potential investors.
“The Joint-Venture NCR Land Development model is where NCR land owners can joint-venture with the government in developing oil palm plantation or processing plant on their land,” he said.

Apply Licence and Sell to Factory For Smallholders In Rural Areas

Govt agencies offer better prices to oil palm smallholders
PORT DICKSON: Palm oil mills operated by several agencies under the Rural and Regional Development Ministry are in a better position to offer attractive prices directly to smallholders based on market prices. Its Deputy Minister, Datuk Hasan Malek, said this eliminated middlemen who normally enjoyed exorbitant profits from smallholders in rural areas.
“In our pursuit to reap profits, the mills under the agencies also have a social obligation towards these oil palm smallholders.“There is an estimated 250,000 smallholders in the rural areas operating 500,000 hectares of smallholdings,” Hasan told reporters yesterday after officiating a workshop on management practices for palm oil mills under the ministry’s agencies.

The agencies, Felcra Bhd, the Rubber Industry Smallholders’ Development Authority (Risda), the Development Authority of Terengganu Tengah (Ketengah) and the South Kelantan Development Authority (Kesedar) jointly operate 13 oil palm mills under the Rural and Regional Development ministry. Hasan said although the price of per fresh fruit bunch (ffb) was based on standard prices set by the Malaysian Palm Oil Board (MPOB), smallholders were nevertheless subject to manipulation by middlemen.

Meanwhile, he disclosed that proceeds from the sale of crude palm oil by the 13 mills, last year, rose 46 per cent to RM1.6 billion compared with RM1.1 billion in 2007. Optimistic that sales this year would hover around RM1.5 billion, Hasan said the ministry was hopeful the 13 palm oil mills, under the ministry, would perform at par with those managed by Sime Darby Bhd, IOI Plantation, Kulim Plantation and others, in years to come. He also said Felcra, which operated a palm oil mill in Samarahan, Sarawak, planned to set up two additional mills, costing RM60 million, one each in Sri Aman and Mukah, Sarawak, in the next 18 months.

Oil palm seedlings must be sourced from MPOB

By Nigel Edgar
Seeds from fallen oil palm fruits not allowed to be planted
KUCHING: Local oil palm planters are not permitted to plant seeds from fallen oil palm fruits due to the government’s quality control.Planters who disregarded this could be charged with possessing illegal or unlicensed seeds as stated in the Malaysian Palm Oil Board (MPOB) Act 1998.

MPOB Sarawak Regional Head, Sulim Lumong told The Borneo Post yesterday that farmers must get their seedlings from the Board.He pointed out that farmers found having or planting illegal or unlicensed seeds can be convicted in court. If found guilty, offenders can be compounded not more than RM250,000 and/or jail not more than three years. “Apart from planning, researching and developing the palm oil industry in Malaysia, MPOB is also responsible in enforcing the MPOB Act,” he said. Sulim revealed that this year, a planter have been convicted of possessing illegal or unlicensed seedlings and three others were found guilty of operating illegal or unlicensed nurseries.“You can’t just plant oil palm like any other trees. You must have licences in distributing and selling the seedlings,” he pointed out. Therefore, under the second stimulus package, RM100 million was allocated by the government to aid small time farmers to apply for licence or to replant palm oil.

Under the second stimulus package, the government is providing aid of RM6,000 per hectare to small farmers to replant old oil palm estate.Small scale private farmers are those with plantation size 40.46 hectares or 100 acres. Sulim explained that this aid, implemented on December 1, 2008, was an addition to the Oil Palm Replanting Incentive Scheme which is RM1,000 per hectare for small farmers with trees aged 25 years and above. “Until December 2008, MPOB nationwide statistics show 46,061 hectares of small plantation were trees aged over 25 years old which involved 24,763 small farmers. “Palm oil trees aged above 25 years are not productive and have lower yield of quality stalk. Therefore, small farmers who have trees beyond 25 years old are urged to apply for the government’s aid so they cant plant new high quality seedlings,” he said.

The objective of the aid, Sulim further revealed, was to stimulate the economy with the involvement of small time farmers contributing to the input of raw materials.
The aid was also aimed to lower the replanting cost like covering the buying of seedlings, fertilizer and pesticide. It is also aimed to lower the palm oil stockpile to help in increasing the market value, he added.

The aid worth RM6,000 per hectare would include site preparation and management, seedlings, and farming input which includes fertilizer and pesticide. The programme was initiated in March this year and will end in December 2010 or until the allocation is finished. Application is a first-come-first-serve basis.

According to a printed statement from MPOB, here are two ways how eligible small farmers can make use of the aid.They can manage their own by choosing their own contractor to prepare the site and supply of farming input, and present the receipt or a certified letter to claim RM6,000 per hectare from MPOB.

To make it easier for the farmers, MPOB will advance of RM3,000 per hectare to start.
The second way is small farmers can leave all the management to MPOB including appointing of contractor. If the cost is less then RM6,000 per hectare, the remainder will be given to the farmer. If it is more, the scope of the aid will be limited. Therefore farmers, in this way, are required to sign an agreement letter between the contractor and MPOB. For more information on the aid, interested farmers can contact MPOB at 03-89251122 or 03-87694400, or go to website www.mpob.gov.my.

ECM Libra: CPO exports to be slower this month

KUALA LUMPUR: Crude palm oil (CPO) exports are likely to be slower this month following stronger production and festive season in Pakistan, according to ECM Libra. Pakistan had made heavy purchases of palm oil for August and September, the firm said in a research note yesterday.

ECM Libra said many factors like weather, poor fertilisation, practices and government replanting that might stem the growth in production numbers.
Last month, the CPO stocks stood at 1.3 million tonnes, the same level as in July. However, the research firm said that news reports on drought in India are likely increase demand for the commodity in the region.

Meanwhile, ECM Libra Investment Research has maintained its neutral recommendation on the property sector.It said while the property sector has bottomed out and was recovering, conditions were not sufficient to re-rate it.ECM Libra said its stock picks remained selective, preferring mid- to small-capitalised property developers where valua-tions were more compelling. “Among the picks are Sunway City, for its resilient property investment earnings while there is potential upside from recovering property development earnings, and Sunrise due to its strong brand name and prime landbank,” it said in its research note yesterday.

It said there was pick-up in commercial activities in August following the acquisition of a 50 per cent stake in Menara Citibank by Hap Seng Consolidated, as well as the sale of an eight-storey corporate block in Southgate commercial centre by Mah Sing to Koperasi Permodalan Felda Bhd.
ECM Libra said Glomac was also finalising the sale of a 30-storey corporate tower at its Glomac Damansara project to a government agency.

It said following a pick-up in property transactions in recent months, more developers were now planning new property launches. “Among them are IJM Land, Mah Sing, Selangor Dredging, Dijaya Corp, GuocoLand, MRCB, Metro Kajang, TA Enterprise and TSR Capital,” it said.
— Bernama

NCR land owners prefer personal oil palm plantations

SARIKEI: Many owners of native customary rights (NCR) land in Julau are interested to open their own palm oil plantations. According to Christopher Ijau Mudai, a former councillor of Meradong/Julau District Council who talked to The Borneo Post yesterday, he was one of those landowners in Julau who were not keen to participate in a proposed joint-venture oil palm plantation with Sime Darby.“We are not anti-development. It’s just that the joint-venture concept is not appealing to us,” said Christopher who claimed to be among the landowners from over 10 longhouses in Julau who had opted out of the proposed joint-venture deal.“We want an alternative way that we feel comfortable with,” Christopher said, apparently referring to an idea suggested by Edward Chun Jelian in The Borneo Post’s article under the headline ‘NCR landowners want loans to start own mini estates’ last Friday.

Edward has said that if there were special loan facilities made available by the government, most owners of NCR land would go for them as the doors of commercial banks were closed to them.
Edward had also claimed that he did hear of credit facilities such as the government’s Modal Usahawan Tani (MUST) or Palm Oil Replanting Scheme (TASKS) made available through AgroBank, but he was not sure whether these were extended to owners of NCR land.
As proposed by Edward, each family would start off with 10 acres, which he believed was manageable by every household, Edward said.But to do that, each family would require RM50,000 in loan for clearing the jungle, make terraces, construct access road and bridges and to obtain 500 seedlings.

Unfortunately, the quantum of loan from TASKS is RM6,000 per hectare, so Edward hoped that banks would give exception to their case.He believed the proposed 10-acre plantation was capable of generating an income of RM3,000 per harvest twice a month.“After deducting operations cost and loan repayment, each household could still earn over RM1,000 per month which is well above the poverty line,” he said.

Plantation Owners Appeal For Review on CPO Sales tax

KUCHING: The Sarawak Oil Palm Plantation Owners Association (Soppoa) is appealing to the state government to review the tax threshold for the State Sales Tax (SST) on Crude Palm Oil (CPO).

It is urging the government to only impose the 2.5 per cent SST per tonne when the CPO price is above RM2,500 per tonne and not to impose any tax when the price drops below RM2,500 per tonne for the next five years.

Soppoa said in a press statement yesterday that the Malaysia Palm Oil Association (MPOA) was also appealing to the state government to review the SST for its Sarawak members.
“The next five years will be critical for the oil palm industry as the plantations reach maturity and reach sustainable yield per hectare.“Soppoa and MPOA hope the state government will take cognizance of this critical period in considering their appeal for a review of the SST,” said Soppoa.
Soppoa had submitted a proposal to the state government in April, while MPOA is believed to have submitted theirs in June. Some 70 per cent of plantation owners in Sarawak are members of Soppoa. Soppoa explained that at present, a five per cent SST is imposed on every metric tonne of CPO produced in Sarawak when the Malaysian Palm Oil Board (MPOB) average price is above RM1,500 per tonne.

The SST is reduced to 2.5 per cent when the CPO price is between RM1,001 and RM1,400, and no tax is levied when the price drops below RM1,000 per metric tonne. With the current CPO price at above RM2,000 per tonne, oil palm plantation owners in the state have to pay more than RM100 SST for every tonne they produced.

Soppoa said the review of the SST was necessary to help plantation owners in the state through the period of low yield and high cost as most of their palm trees have yet to reach full maturity.
It added that although Sarawak has the highest planting rate in Malaysia, the state is a late entrant to the industry and its plantations are the youngest in the country.
At present about 80 per cent of the palm trees in Sarawak have yet to reach full maturity and maximum yield, Soppoa said.

It also revealed that a study carried out by KPMG, a consultant firm engaged by the association, showed that it would take at least five more years for the plantations in the state to reach the level of maturity and yield as those in Peninsular Malaysia. Based on MPOB data, the yield per hectare in Sarawak was 16.22 tonnes last year compared to 19.63 tonnes in Peninsular Malaysia for the same period.

Typically, harvesting of oil palm trees begin only from the fourth year onwards, which meant that for the first three years plantation owners have no source of revenue. The yield increases as the trees mature and plateaus off from the eighth year of planting. MPOB projected that Sarawak planters could only break even when the price is RM1,820 per tonne in 2009 but would incur a loss if the SST was taken into account. However, Soppoa said the average yield per hectare in Sarawak was expected to rise to 20 tonnes in the next five years as more trees mature and planters could expect to break even with CPO price of RM1,500 per tonne based on current production costs.Soppoa also said that Sarawak planters have to incur higher handling costs as the transport infrastructure in the state was less developed compared to Peninsular Malaysia.

Meanwhile, Land Development Minister Dato Sri Dr James Masing when contacted for his reaction to SOPPOA’s call, replied: “It is something that the government should consider seriously given the current financial meltdown.”

Tapak Semaian

Saya memulakan projek saya pada 14 Julai 2007 dengan membeli 1000 biji sawit pracambah. Penjagaan anak sawit di tapak semaian amat mencabar. Saya menggunakan cara dua peringkat. Peringkat pertama 3 bulan dan peringkat kedua selama 9 bulan.

Belian 1000 Biji Benih dari Borneo Samudera Sdn. Bhd

Picture taken 28 Jun 2008 (11 months) - ready for field planting

Prjek saya ini bermula pada 4 Julai 2007 dengan memberi 1000 biji benih berharga RM 1.35 pada masa itu. Saya telah menyediakan tapak semaian seminggu sebelum penghantaran

Kos terlibat adalah:-

4/4/07 Perimeter survey tanah RM 500.00

4/6/07 Gaji menyediakan 1000 beg semaian = RM 500

22/9/07 Polythene bag 10kg =RM 85.00

Good Exercise

Today I went to my Oil Palm garden together with my father. I had a very good exercise after working along the perimeter. All the palm seem growing very well. If I do this every weekend, I think it i can reduce my weight and sliming down.

My terung dayak that I planted last year had bear fruit. I manage to collect 5 kgs.

Why I choose Oil Palm Planting

This is why I choice Oil Palm planting when my father ask me to help develop the land at a very remote areas. The reason why I choice Oil Palm are:-
1. Existing Oil Plam mile nearby
2. Oil Palm can generate income for 20 over years
3. Good integration with livestock

CPO futures up on higher oil price Crude Palm Oil (CPO) future price will increase, influenced by the increasing world oil price, a trader said. Palm oil is an alternative biofuel source which makes it a much sought after commodity amid the rising oil price. At close, the February 2009 CPO futures contract increased RM20 to RM1,780 per tonne. Dealers said overseas demand, especially from China which is the world's largest buyer of palm oil and progress in biodiesel projects locally are expected to provide some good news. The Malaysian Palm Oil Board reference price at mill gate is RM 307/tonne for grade B. One hectare of Palm Oil can produce about 30 tonne per year. That will generate a gross income of about RM 90,000.00 a year for small holder farmer of 10 ha planted with mature oil palm.

Rambut Penghalau babi hutan-Terbukti berkesan di Ladang Kelapa Sawit

Pengusaha ladang kelapa sawit di Pulau Sebatik, Sabah menggunakan rambut manusia sebagai bahan untuk menghalau babi hutan menurut petikan yang diambil dari Utusan Sarawak.

Kaedah yang digunakan adalah menabur rambut manusia berhampiran anak pokok sawit telah berjaya mencegah anak pokok sawit dari dimusnahkan yang menurut pengurus ladang boleh mencapai kejayaan 95%.

Segengam rambut yang ditabur sekeliling pokok apabila babi tersedut rambut itu ia akan terhidu bau manusia dan akan melarikan diri. Rambut-rambut ini boleh dikumpul dari kedai-kedai saloon atau gunting rambut dengan harga RM5 seguni.

Tranfering the seedling to the field. Field planting using man power RM 2.00 per plant.

How To Plant Oil Palm the Smallholders Way

In this blog I will share my style of planting oil palm with very minimal capital