August 19 2003 - PALM oil smallholders, including those managed underagencies like Federal Land Consolidation and Rehabilitation Authority,Federal Land Development Authority and Rubber Industry SmallholdersDevelopment Authority, should increase their productivity or risk losingtheir sales to Indonesian producers.

Primary Industries Minister Datuk Seri Dr Lim Keng Yaik said in some partsof the world, such as India and Ukraine, Indonesia has begun to stamp itspresence by beating Malaysia’s dominance in oil palm.

Now, India and Ukraine import 60 and 55 per cent respectively of theirpalm oil from Indonesia.

If Malaysia is to remain competitive, the smallholders must do away withtheir old practices and instead increase their productivity, he said,adding that otherwise Indonesia would be the largest producer of palm oilin the next five years.

Speaking to reporters after officiating at a programme for smallholders inMalacca yesterday, Dr Lim said Indonesia posed a big threat as itsproduction cost is lower due to its cheap labour.

Thus, he added, Malaysia needs to improve its yields and productivity tocompete.

He said since smallholders account for 40 per cent of the national oilpalm output, it is essential that they play their role in increasingproductivity. Dr Lim said the ministry does not have problems with thelarge oil palm estates as they have been productive.

Among the smallholders, their yield is less than five tonnes per hectareper year, whereas they should be producing between eight to 10 tonnes.

If the smallholders do not change their planting and harvesting methods,Malaysia will lose in the long run,” he said.

Earlier, the minister witnessed an agreement signing between the MalaysiaPalm Oil Board (MPOB) and CCM Fertilisers to produce better fertilisercalled MPOB F2.

The board was represented by its director-general Datuk Dr Yusof Basironwhile CCM was represented by its managing director Datuk Mizanur RahmanGhani.