Sarawak needs more palm oil mills to stem loss

by Wilfred Pilo. Posted on October 2, 2011, Sunday

KUCHING: Millions of ringgit will continue to be lost if the plight of palm oil plantations and smallholders is not addressed as soon as possible due to the shortage of palm oil mills in the state.

Minister of Land Development Tan Sri Dr James Masing said this when contacted Friday.

The matter has now worsened as the supply of fresh fruit bunches (FFBs) has overwhelmed the capacity of present oil palm mills.

To put an end to the continual loss of not only money but unprocessed FFBs, he agreed that there was an urgent need to establish and build more oil palm mills in Sarawak.

“Until and unless the Malaysian Palm Oil Board encourages oil palm planters to build more mills we are in danger of losing revenue from this industry.

“The government is very concerned over the matter and will look into this as soon as possible,” he asserted.

Masing also sympathised with the plantations and especially smallholders who had to suffer due to the deterioration of FFBs because of the long waiting period at the mills.

According to a news report in the Borneo Post on Wednesday, if the FFBs are not processed immediately, the oil extraction rate (OER) of the unprocessed stock would drop by one per cent per day.

An experienced palm oil industry player stated in the news report that because of the  unprocessed stock and low OER, smallholders could lose millions of ringgit a month if the mills are unable to process their produce.

Not only that, he said industry players may risk rejection at the processing hub despite the round-the clock mill operation due to the over flowing supply of FFBs.

Industry players in the state also feel that Sarawak has far exceeded the official record of the 900,000 hectares of land cultivated with palm oil as production from smallholdings and smaller plantations have not been taken into account by the authorities.

Plantation owners however said that they do not blame the government as MPOB rarely turns down their industry application for new mills and they hope the situation would be solved soon.

Currently, the state has 52 mills in operation and to meet the current demand and needs, industry players want at least 30 new mills to be built.

Read more: http://www.theborneopost.com/2011/10/02/sarawak-needs-more-palm-oil-mills-to-stem-loss