KUALA LUMPUR (Feb 25): As palm oil demand surges, there is a need for yield improvement through sustainable practices to address the potential demand and supply imbalances.

This according to industry leaders who attended the Bursa Malaysia 36th Annual Palm and Lauric Oils Price Outlook conference and exhibition on Tuesday.

Currently, the Malaysian palm oil industry’s average yield per hectare stands at a mere 3.7 tonnes per hectare.

In a panel discussion, Harish Harlani, vice-president & global leader of P&G Chemicals cautioned that without strategic intervention, the industry may face a supply shortfall amid the potential surge in palm oil demand. 

According to him, the key to addressing this yield improvement issue lies in an emphasis on replanting and sustainable farming practices. He called for plantation firms to adopt a regular replanting schedule, regardless of fluctuations in palm oil prices. 

Meanwhile, Tan Sri Lee Oi Hian, executive chairman of Kuala Lumpur Kepong Bhd (KL:KLK) pointed out that there is significant room for yield improvement, particularly for larger plantation land. 

While acknowledging the critical role of labour in the sector, he said there has been a growing focus on innovation and automation as part of operational improvements.

Similarly, Dr Shariman Alwani Mohamed Nordin, chief executive officer of SD Guthrie International (SDGI), emphasised the importance of investing in automation and innovation to develop tools and mechanisms that could eventually lead to automated harvesting. 

“We are not far off from achieving the holy grail of harvesting automation,” he remarked, noting that with adequate investment in resources, the industry could significantly reduce its reliance on manual labour. 

SDGI is the downstream arm of SD Guthrie Bhd (KL:SDG).

Read also:
Plantation Ministry working with TNB, Energy Commission to boost RE grid connectivity, supply
Replanting effort slowed, posing risks to palm oil industry, plantation minister cautions
EUDR costs may drive demand shift from palm kernel oil to crude coconut oil, says Fastmarkets
Bursa Malaysia Derivatives hits all-time high of 22.75 mil contracts in 2024 — Abdul Wahid