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.