15/05/2012 (Bernama) - Farm mechanisation plus better salary packages for local workers is crucial in overcoming the heavy dependence on foreign labour in the country’s oil palm industry.

Despite advances in mechanisation, Minister of Plantation Industries and Commodities, Tan Sri Bernard Giluk Dompok, said the adoption of mechanisation is still limited to large oil palm plantations due to its high investment costs.

The text of his speech was read out by his deputy, Dato’ Hamzah Zainudin.

With oil palm plantations facing a severe labour shortage of about 35,473 workers, the plantation sector needs to undergo a paradigm shift from one that is heavily reliant on labour to mechanisation as the industry progresses.

Although higher wages to woo locals would raise production costs, he assured that it would be offset from productivity gains as the workers get more motivated.

Therefore, it is pertinent for the industry to boost productivity and explore all rational means of mechanization to recoup some of the cost escalations.

“If we want to reduce dependency on foreign labour, we need to change the way we do things,” he said in his speech when opening the “Palm Industry Labour: Issues, Performance and Sustainability Seminar (PILIPS 2012) organized by the Malaysian Palm Oil Board (MPOB) here today.

He lauded the introduction of farm machinery such as Grabber, harvesting tools and field machinery for fresh fruit bunch (FFB) collection, including for use in peat areas.

He cited Cantas, the technically efficient harvesting machine, has having proven to raise worker productivity in harvesting FFB and reducing labour.

To encourage its use, the government is providing an incentive of RM1,000 for every unit of Cantas purchased.

Dompok lamented how the high number of foreign workers employed in the plantation sector has caused a negative impact on the Gross National Income of the oil palm industry, although it is a strategic sector to transform the economy.

“It is estimated that foreign workers remit an average of 60 per cent of their income back to their home countries,” he said.

Out of the 491,339 workers in the sector, 76 per cent of the workforce comprised foreign workers, mainly from Indonesia, who were employed as harvesters, fresh fruit bunch collectors and field workers for weeding, fertilizer application and pruning.

In efforts to mitigate the over-dependence on foreign labour and woo locals, Dompok said the ministry through its agencies set up the Institute of Malaysian Plantation and Commodities (IMPAC) to develop human capital.

It entails training programmes in the oil palm industry encompassing all levels of operations from planting of seedlings to plantation activities, milling, processing, storing, support services and marketing.

Datuk Seri Utama Shahrir Abdul Samad, the Chairman of the Malaysian Palm Oil Board, noted that even at the middle management levels such as supervisors and mandors, the gaps are now being filled by foreign workers.

In his speech at the seminar, he said the industry is expected to contribute RM178 billion to GNI by 2020, which would create an additional 41,000 jobs, of which 40 per cent will be high-skilled jobs with an average monthly income of RM6,000.

Shahrir said MPOB was also training local youths to attract them to work in oil palm plantations.