KUALA LUMPUR: The government aims to boost fresh fruit bunch (FFB) yields per hectare from palm oil smallholders by a minimum of 40 per cent, to help increase palm oil production without land expansion.
This translates to an increase of 5 to 10 tonnes per hectare.
Smallholders own about a quarter of palm oil acreage in Malaysia.
Plantation and Commodities Minister Datuk Seri Johari Abdul Ghani said the yields garnered from smallholders to-date range between eight to 12 tonnes per hectare.
Bigger corporations get around 28 to 30 tonnes per hectare, with an average of between 18 to 19 tonnes per hectare.
He said that Malaysia's palm oil covers 5.7 million hectares, 4.2 million hectares of which are run by estates.
The remaining 1.5 million hectares are run by smallholders, both organised and independent.
"If the smallholders from the 1.5 hectares of land increase their yield by an additional five to 10 tonnes, it will increase our crude palm oil production per hectare without the need to expand the land," he told reporters at the signing of FGV Holdings Bhd (FGV) and the Malaysian Palm Oil Board (MPOB) memorandum of collaboration (MoC) to enhance the palm oil industry today.
Johari said the government is supportive of Indonesia's use of palm oil for biodiesel.
"We should be grateful for Indonesia because they produce 40-48 million tonnes and they use about 25 per cent of that for their biodiesel. So that in itself has helped the industry. "Imagine if they do not use biodiesel, that 25 per cent has to go to the world there will be pressure on the price. "We encourage Indonesia to use palm oil as part of biodiesel because they are already B40, we are only B10," he added.
The Indonesian government pledged to mandate a 40 per cent mix of palm oil-based fuel in biodiesel from January 1 initially, from the 35 per cent blend which is currently in force.
The MoC between FGV and MPOB is structured around three key pillars that will drive this transformation namely empowering smallholders, ensuring full compliance with sustainability standards and revolutionising the palm oil industry through the adoption of cutting-edge technologies that will enhance productivity and efficiency.
The document was signed by FGV Chairman Tan Sri Rastam Mohd Isa, MPOB Chairman Datuk Mohamad Helmy Othman Basha, FGV group chief executive officer Fakhrunniam Othman and MPOB director general Datuk Dr. Ahmad Parveez Ghulam Kadir.
Under the collaboration, FGV through its subsidiary will assist MPOB to enhance the effectiveness and usability of existing MPOB platforms, such as GeoPALM and the Sawit Intelligent Management System (SIMS).
This will involve integrating advanced technologies, including geolocation mapping, data verification, block chain for traceability, and tools for data analysis and decision-making.
Another key focus of the MoC is to empower smallholders to actively participate in sustainable palm oil production. FGV and MPOB aim to raise awareness and support smallholders in complying with the Malaysian Sustainable Palm Oil (MSPO) standards and European Union Deforestation Regulation requirements, which will enhance smallholders' competitiveness and facilitate their access to the palm oil premium markets.
Additionally, the partnership will introduce the 'Kebun Angkat' initiative, a programme designed to provide a selected group of smallholders with appropriate technical assistance and guidance on good agricultural practices.
"This is a significant step in our journey towards a sustainable and transparent palm oil industry in Malaysia. Aligned with FGV's Sustainability Framework, we are deeply committed to uplifting the livelihoods of smallholders, who form the backbone of our nation's palm oil industry."
"By collaborating with MPOB, we are not only advancing traceability systems to meet global standards but also equipping smallholders with the tools and knowledge needed to thrive in an increasingly competitive market. Together, we are forging a more inclusive, sustainable, and resilient palm oil sector," said Rastam.