Foreign workers for Malaysia's palm plantations to arrive in May, June

Malaysia expects a new batch of foreign workers to arrive in May and June for its palm plantations, the plantation industries minister said on Tuesday, a delay of months from an original plan to add more labour early this year.

A shortage of foreign workers to harvest palm fruits in Malaysia, the world's second-largest producer, is likely to cap production, adding to global worries over vegetable oil supplies hit by the Russia-Ukraine war and bad weather in South America.

"With foreign labour coming in, I hope production will increase from 18.1 million tonnes (last year) to 20 million," the minister, Zuraida Kamaruddin, told an industry conference in Kuala Lumpur.

About 80 percent of Malaysia's plantation workers are migrants, most of them from neighbouring Indonesia.

The benchmark palm oil contract on the Bursa Malaysia Derivatives Exchange was down 1.3 percent at RM6,543 a tonne by 0541 GMT (1.41pm Malaysia time), off its all-time high of RM7,108 ringgit (US$1,700.89) hit last week.

Malaysia's palm planters have battled a worsening labour shortage since the start of the coronavirus pandemic as border curbs kept out migrant workers, slashing the numbers available to harvest and fertilise the perishable palm fruits.

In September, authorities approved the recruitment of 32,000 migrant workers for palm plantations, with Indonesian migrant workers expected to arrive around mid-February.

But analysts were sceptical that workers could be ready in time.

"Even if they (workers) arrive, it will take time for training, as you're not looking necessarily at skilled workers, you're looking at people who don't have any harvester experience," Julian McGill, the Southeast Asia head at LMC International, told Reuters.

Global supplies of edible oil stand to take a hit in coming months as dry weather reduces soybean production in Brazil, the world's biggest exporter of the oilseed, while Russia's invasion of Ukraine has shuttered ports.

Russia and Ukraine account for 80 percent of global exports of sunflower oil, which competes with palm.

- Reuters