AI-powered palm oil mill saves RM1.6mil a year, cuts foreign labour by 33pct
26/02/2025 (New Straits Times), Kuala Lumpur - The first Artificial Intelligence (AI)-powered palm oil mill in Malaysia has demonstrated significant cost savings and reduced reliance on foreign labour, saving an average of RM16 million a year and a 33 per cent reduction in foreign workers.
Located in Kuala Kangsar, the mill — operating at a capacity of 45 metric tonnes per hour — had reduced processing costs by an estimated RM1.6 million per year due to lower oil losses and maintenance expenses.
"Initially, the mill employed 66 foreign workers, but with AI, the number has dropped to just 44 — a 33 per cent reduction, equivalent to RM1.1 million in wage savings," said Plantation and Commodities Minister Datuk Seri Johari Abdul Ghani in the Dewan Rakyat.
Johari, who is also Titiwangsa member of Parliament, said the AI system installed only cost RM5 million, meaning the investment can be recouped within two years.
Responding to concerns raised by Hulu Terengganu MP Datuk Rosol Wahid about potential job losses due to the use of advanced technology, Johari dismissed the fear.
"What is most important is that this technology can transform the industry's profile from reliance on foreign workers to employing more locals," he said.
He stressed that AI-based operations require skilled local workers for monitoring, shifting jobs towards higher-income opportunities.
"Many of these technologies require expertise to manage AI, making them more aligned with high-income jobs," Johari said.
He first spoke about the mill, Minsawi Industries, a palm oil mill that has been in operation for 41 years, in November of last year.
Minsawi, in partnership with Airei Sdn Bhd, integrated AI, sensors, and predictive tools to streamline the processing of palm oil.
"If this technology proves effective, it should be considered by all stakeholders in the palm oil sector," Johari told reporters.