Analysts at the Malaysian Palm Oil Association (MPOA) believe that palm oil producers could lose about $4.6 billion this year due to labor shortages on the country’s plantations. According to them, this will also lead to a restriction on the global supply of palm oil and increase the price of the product around the world.
Rotting on the trees
As specified in MPOA, this year five times fewer workers arrived in Malaysia than it was necessary – about 14 thousand people. Industry participants assured that the inflow of workers is extremely low, and the harvest, which should already be harvested from oil palm trees, remains “rotting on the trees.
According to Joseph Tek, head of the Association, the number of foreign workers arriving in Malaysia is “negligible” compared to the number actually needed. He noted that while various services have tried to increase the influx of workers, problems still remain.
This year, according to the latest MPOA estimates, palm oil production in Malaysia in 2022 will be 18 million tons.
Recall that stocks of the product in the country by the end of November began to decline for the first time in the past few months, according to data from a survey of traders and market analysts. According to experts, stocks of “palm” in the country decreased for the month by about 0.5% – to 2.39 million tons, although in October this year, the figures were at their highest level since September 2019.
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