Covid 19 - An Overview of Labour Shortage Issues in the Oil Palm Industry
Written by, Amni Syazana Azahar, MPOCC
The covid-19 outbreak started in 2020 and has affected the whole world. Until 8 February 2022, there are about 2.93 million cases of Covid-19 reported including 32,043 deaths in Malaysia and a total of 396 million cases worldwide including 5.7 million deaths reported by WHO.
Referring to the Covid-19 situation, the Malaysian government has implemented the Movement Control Order (MCO) from March 2020. These restrictions also gave a huge impact on the oil palm industry. As of April 2020, 337,000 migrant workers are from the oil palm industry and most of them are from Indonesia, where 80% of the workforce returned to their hometowns. Meanwhile, Malaysia closed its borders and the government also froze new working permits for foreign workers to control the spread of Covid-19.
Malaysian Estate Owner Association (MEOA) also stated for The Edge Market in the article published in April 2021, that the Fresh Fruit Bunch (FFB) yield will show a decreasing trend until the end of 2021. It is proven that the production of FFB yield for 2021 is the lowest in the three decades.
ESSENTIAL ACTIONS FOR THE MALAYSIAN PALM OIL INDUSTRY TO ACHIEVE NET ZERO
Almost 90% of Malaysian palm oil has been certified under the national scheme Malaysian Sustainable Palm Oil (MSPO) scheme with duplicated certification under voluntary schemes.
This pandemic depicts the oil palm industries’ dependency on the foreign workers in the estate operation especially harvesting jobs where 85% of the labour workforce consists of foreign workers. This problem affects not only the smallholders but also the big names in the plantation industry. Nageeb Wahab the Chief Executive of Malaysian Palm Oil Association (MPOA) also stated in the article published on 27 Jan 2022 by Bloomberg that they could survive during that moment due to the good price of the FFB and Crude Palm Oil (CPO).
This situation became an eye-opener to the industry, and it portrays the major problems that the industry faces. Moreover, foreign workers play an important role in the estate operation either in upkeep or harvesting operations. Most of the foreign workers have already worked with the estate for a long time and they understand the estate works. They also have higher productivity and are hardworking employees.
Goes to show why employers of the oil palm industry favours the foreign workers for the upkeep and harvesting operations. Without them on the estate, operations are interrupted. The decreasing number of harvesting workers lead to reducing numbers of harvest rounds and the ripened produce are left rotten on the trees.
Working in the oil palm industry as general workers and harvesters do not catch the eyes of locals because they considered the job dirty, difficult, dangerous, and demeaning, the 4D’s. However, during the border restrictions, we could see the vacancies to work in the estate as general workers and harvesters are opened widely to locals by the plantation companies.
Even though there were vacancies with good wages, the applications were still very low. This also shows that youth nowadays cannot tolerate the working environment in the oil palm plantations. Though there are advantages of hiring locals; higher level of understanding, but attitude and low productivity will be on the line.
Lastly, labour shortage is a significant issue faced in the oil palm industry, especially during the Covid-19 outbreak. We could see the effect of labour shortage on the palm oil industry since 2021. Now, heading towards the endemic phase, everyone will adapt and live together with covid-19. The cabinet meeting on 10 December 2021 has agreed to open borders for foreign workers to work in permitted sectors and plantation being one. This is surely good news for the oil palm industry as we could see the importance of foreign workers in the estate operations.
