RM20 Billion Revenue Losses Expected Due To Shortage of Oil Palm Harvesters

Joseph Tek

The estimated revenue losses due to the shortage of oil palm harvesters alone is estimated to be RM20 billion, said Malaysian Palm Oil Association (MPOA) Chief Executive Joseph Tek Choon Yee.

Tek disclosed this in his keynote address at MPOA’s National Labor Forum (NLF 2022) with the theme “Mitigating Challenges on the Imperatives of Workforce in Plantation Sector ” that was held in Subang Jaya.

It was attended by over 200 participants including MPOA members, invitees from the industry and stakeholder speakers from the various government agencies and other service providers involved in the recruitment and return of foreign workers to Malaysia and human resource requirements for the plantation sector.

In addition to the slow return of the foreign workers, the forum also deliberated on the matters relating to HRDC levy, multi-tier levy system, mechanization, and the proposed foreign workers’ card in Sabah.

MPOA, Tek said, is looking forward to the opportunity for the association and other relevant stakeholders in the industry to proactively engage with the government on the matters relating to labor and other human resource imperatives affecting the plantation sector.

He disclosed that a recent Malaysian Palm Oil Association (MPOA) survey on foreign workers from January to November 2022 was conducted deriving the data from its top 10 planter members in Malaysia.

The survey covered the foreign workers recruitment and entry into Peninsular Malaysia for the plantation sector. It is summarized that as of 30 November 2022, 14,159 foreign workers have been recruited and entered the country.

The foreign workers for the plantation sector came from Indonesia (6,837), India (6,532), Nepal (730) and Nepal (60). This represents 49 per cent (ie. 14,159 FW entered / 28,724 FW approved) of the foreign workers approved by the authorities but only represent 19 per cent of the total foreign workers required in Year 2022 (14,159 FW entered / 74,664 FW required), he said.

According to Tek, the survey provides an overall indicator representing the current labor shortage situation of the plantation sector.

“The trifling numbers of foreign workers coming in are still far from an earlier estimate of over 120,000 workers required to address the present shortage of workers in the oil palm plantation sector,” he added.

The plantation sector, he said, acknowledges the efforts and stride made by the various government agencies thus far which include solving domestic glitches at our receiving end and the formation of the one-stop center of Foreign Workers Division under the MOHR.

However, bottleneck issues still persist at the various source countries and also including at arrival. In many instances, final processes involved in the recruitment are beyond the capacity of most industry players towards expediting the arrival of the large numbers of foreign workers, he lamented.

“The sector implores upon the government to help in facilitating the processes from the source countries, including renewed and effective G2G engagements leading to fruition the expedited arrival of the foreign workers.

“For the oil palm plantation sector, there is the need for the relevant authorities to review the recruitment of foreign workers based on sectoral differentiation. The recruitment processes involved could be expedited by drawing and using the national sustainability certification that is already in place, the Malaysian Sustainable Palm Oil (MSPO) as the legal framework for reference.

“Also important, all mitigation measures and due processes relating to zero recruitment fees, potential forced labor risks must also be in place and the compliances adhered to. Logistic issues including the chartering of planes will also need to be addressed,” said Tek.

There is much work to be pursued to ensure adequate labor force and all the other human resource matters relating to the plantation sector so that the industry can play its full role in supporting a stronger economic recovery, he said.

“Through inclusive and effective engagements with all the relevant stakeholders, MPOA looks forward to engaging with the government and the various agencies to work solidly together so that we can reach the finishing line sooner in the recovery and post-pandemic phase,” Tek said.

Various update briefings were shared during the forum by invited speakers from the Ministry of Human Resources (MOHR) – Migrant Worker Management Division on Plantation Sector, Department of Labor Peninsular Malaysia (JTKSM) on Plantation Sector, from the Immigration Department of Malaysia (JIM) – Foreign Worker Division on Plantation Sector, Bestinet Sdn Bhd on the Foreign Workers Centralized Management System (FWCMS), the Human Resource Development Corporation (HRDC) for HRD Levy for the Plantation, the Ministry of Plantation Commodities (MPIC): Innovation Promotion and Industrial Human Capital Department (PIMI) and Institute of Malaysian Plantation and Commodities (IMPAC).

In a question and answer session, questions were raised by participants on forced labor at workplace and human trafficking including practices on passport management, US Customs Border Protection (CBP), Malaysia’s current Tier 3 status and other related issues with the speakers.