Sarawak Oil Palms Bhd (Sarawak Oil Palms) has embarked on new initiatives and seeks market diversification, to overcome challenges such as labour crunch, price swings and import restrictions.
Sarawak Oil Palms group executive chairman Tan Sri Datuk Ling Chiong Ho said for the plantation sector, crop losses were severe due to labour shortage despite the group’s best efforts to recruit more workers.
“Labour was a common structural issue across the industry that was expected to persist,” Ling said in Sarawak Oil Palm’s Annual Report 2019 chairman statement.
“As such, we had embarked on new initiatives with mechanisation to improve efficiency.”
According to Ling, the industry will always encounter challenges such as labour crunch, price swings and import restrictions.
“To overcome these, we will seek market diversification, to be less labour intensive and raise efficiency in order to lower cost.
“We will forge ahead by harnessing the full potential of our assets, stay resilient against any adverse external shocks and continue to deliver exceptional value to our stakeholders.”
In anticipation of future developments, Sarawak Oil Palms had decided to set aside a large portion of reserve funds for strategic purposes.
Ling highlighted that the cash and cash equivalents of RM755.8 million as at 2019 closing would be managed sensibly for better debt management and act as a buffer from any unfavourable market fluctuations.
On the COVID-19 pandemic, Ling acknowledged that it is an emerging crisis for the world.
“It is my fervent hope that we can overcome it together and achieve better results for the year 2020 and for Sarawak Oil Palms to be further recognised as a leading integrated sustainable producer in Sarawak.”