SARAWAK OIL PALM PLANTERS SEEK RESPITE FROM GOVERNMENT

I believe my planter friends working abroad will be glad to be updated if they have missed reading the news reported in today thestar online:

Sarawak oil palm planters, badly hit by the sharp fall in crude palm oil (CPO) prices, want the Government to give them some breathing space by waiving the windfall profit tax, lowering the cess and sales taxes, and regulating high fertiliser prices.

They have also proposed that the unused portion of the cess collected for the Cooking Oil Subsidy Scheme by the Malaysian Palm Oil Board (MPOB) be refunded directly to Sarawak plantation companies.

A waiver is also proposed for Sarawak plantation companies which are still paying their outstanding cess instalments.

Sarawak planters have paid about RM157mil in cooking oil cess this year.

Sarawak Oil Palm Plantation Owners Association spokesman Paul Wong told StarBiz that Primary Industries and Commodities Minister Datuk Peter Chin Fah Kui had assured the association that its proposals would be studied. The association had a dialogue with the minister yesterday.

“The feedback to our proposals will be made known by January,” said Wong, who is also Sarawak Oil Palms Bhd chief executive officer.

Wong said the minister had also given an indication that Sarawak planters would be allowed to export their CPO tax-free, given the high national CPO stockpile.

About 10 Sarawak-based plantation captains attended the dialogue session, namely Sarawak Oil Palms, Sarawak Plantations Bhd, Solid Group of Companies, WTK Group of Companies, Rimbunan Sawit Bhd, Ta Ann Holdings Bhd, Seatex Development Sdn Bhd, Woodman Group, Rimex Group and KTS Group.

“We can also form a consortium to jointly set up our own refineries if the existing four refiners in Sarawak refuse to abolish the RM40 per tonne discount on our CPO price,” said Ta Ann Holdings managing director Datuk Wong Kuo Hea.

Sarawak Plantation group managing director Mohamad Bolhair Reduan said the Government should use the MPOB cess on research and development to assist Sarawak planters in sustainable management of peat areas as well as cultivating more efficient agriculture practices.

The Sarawak oil palm industry is still at an infancy stage with only about 20% of matured oil palm areas and low yields.

“Given our young plantations, the RM200mil replanting scheme and subsidy by the ministry recently will not benefit Sarawak,” he said.

With the CPO price currently at about RM1,500 per tonne, Wong said many Sarawak planters were incurring substantial losses and cash flow squeeze, given their high cost of production at RM1,800 to RM2,000 per tonne. Planters in the peninsula have a cost of production of about RM1,100 to RM1,200 per tonne.