02/12/2008 (My Sinchew), Kuala Lumpur - Oil palm smallholders are still making a profit, although smaller, from crude palm oil (CPO) which is at a low level of RM1,500 per tonne at the moment.

The Deputy Minister of Plantations and Commodities Senator A. Kohilan Pillay G. Appu said the low CPO prce had affected the smallholders.

"Today, the cost of production of fruit bunches is in the range of M900-RM1,000 per tonne and the profit is about RM400.

"Although the profit margin is low, we consider the price of RM1,500 per tonne as one where they can still make a small profit," he told the Dewan Rakyat today.

He said this while answering a supplementary question from Datuk Siringan Gubat (BN-RANAU) on the burden being shouldered by smallholders following the fall in the CPO market price and the steps being taken to overcome it.

The CPO price was at the RM1,600 per tonne level in 2006 and almost reached RM4,400 per tonne in June 2008 but fell to the present RM1,500 per tonne.

Kohilan said the government had taken various steps to help the smallholders including reducing the price of fertilisers by 15 percent, introducing the replanting scheme by felling tress more than 25 years old and offering a RM1,000 incentive for each hectare replanted.

The total land area under oil palm cultivation in Malaysia is 4.4 million hectares with 2.39 million hectares in Peninsular Malaysia, 1.32 million hectares in Sabah and 692,679 hectares in Sarawak.

There were 373,000 workers in the oil palm industry in the country until June this year.