18 PLANTATION & COMMODITIES @ AGROBiz | September-October. 2025
18 PLANTATION & COMMODITIES @ AGROBiz | September-October. 2025
Rising export earnings
• Malaysia’ s planted oil palm area is projected at 5.64 million hectares in 2025.
• The government allocated RM100 million in matching grants and proposed a RM1.4 billion replanting fund to strengthen smallholders.
• Forestry data from State governments will be compiled for submission to the FAO next year.
MALAYSIA’ S palm oil sector was expected to experience a slight expansion in 2025, with the total planted area projected to reach 5.64 million hectares.
The increase, though modest, reflected the ongoing replanting efforts that continued to shape the industry’ s future, said Plantation and Commodities Deputy Minister Datuk Chan Foong Hin.
He explained that the modest growth reflected the emergence of immature areas from past replanting activities that had entered production.
PALM OIL OUTLOOK 2025“ In the first half of 2025, the palm
TARGETS AHEAD: Chan Foong Hin speaking to the reporters at Agri Malaysia 2025 on the outlook for Malaysia’ s palm oil industry. oil industry generated RM53.43 billion in exports, representing a 9.3 per cent surge compared to the same period last year,” Chan explained, noting that palm oil remained a key contributor to the economy.
“ Overall, the industry contributed 2.3 per cent to the national gross domestic product( GDP), underpinned by a smallholder network that cultivates 26.4 per cent of planted oil palm land and supports nearly 450,000 families.”
He mentioned this during the launch of Agri Malaysia 2025, at a Press conference, where he addressed industry challenges, particularly low replanting rates.
“ Emerging structural challenges, most notably low replanting rates averaging only two per cent, falling short of the four per cent annual target, pose long-term risks to productivity and export continuity,” he said.
Agri Malaysia 2025, themed“ Futuristic Innovative Agriculture,” took place from Sep 11 – 13 at MITEC, featuring 450 exhibitors and trade participants from 18 countries.
To counter this, the government allocated RM100 million in matching grants for 2025 and planned a RM1.4 billion replanting fund from 2026 to 2030 to support smallholders.
Chan also highlighted crude palm oil( CPO) production, which was forecast to rise to at least 19.50 million tonnes in 2025. He said stronger fertiliser application, better labour availability through foreign worker quotas, and favourable prices would drive this growth, though weather risks, such as prolonged flooding, could disrupt harvests.
He also urged the sector to adopt modern technologies.
“ We encourage our farmers, growers and planters to use the latest technologies. As more people adopt new technologies, such as artificial intelligence, they will become increasingly cost-effective.
“ The government hopes to encourage this positive cycle, so that we no longer rely on foreign workers. This is the way forward towards automation and mechanisation,” he said.
Malaysia collects forestry data
CHANGE ONBOARD: The launch of the MSPO Impact Alliance marks a new phase in Malaysia’ s palm oil sustainability efforts. |
ACCORDING to Plantation and Commodities Minister Datuk Seri Johari Ghani, Malaysia has begun compiling comprehensive forestry data from state governments for submission to the Food and Agriculture Organisation( FAO) for next year.
He called on states to cooperate fully by ensuring the information supplied was both current and accurate, particularly on forestry activities under their jurisdiction.
“ A committee comprising the Ministry of Plantation and Commodities( MPIC) and Natural Resources and Environmental Sustainability( NRES) will collaborate in collecting and coordinating the data,” he said.
During a Press conference held after launching the Malaysian Sustainable Palm Oil( MSPO) certification initiative in Kuala Lumpur, Johari explained that his dual role,
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overseeing the Plantation and Commodities Ministry while carrying the NRES portfolio, would help smooth the process of harmonising the datasets.
NEW MSPO IMPACT ALLIANCE
The launch also introduced the MSPO Impact Alliance, a multistakeholder platform designed to elevate Malaysia’ s standing in sustainable palm oil. Johari said the initiative provided space for experimentation and collaboration to strengthen the country’ s global position.
He noted that the Alliance united government, industry, financiers and civil society in shaping solutions collectively. Among its potential applications was a smallholder-focused European Union Deforestation Regulation
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( EUDR) readiness sandbox.
“ This opens opportunities for initiatives such as a smallholder EUDR-readiness sandbox, which would map and document smallholder plots to meet EUDR requirements while ensuring their continued integration into global trade,” he said.
Johari added that the platform could pilot initiatives linked to labour rights, providing workers- including migrant labourers- with safe avenues to raise concerns. It could also support replanting strategies that weave in biodiversity corridors and carbon sequestration..
- @ AGROBiz
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