Automation, the way forward for commodity industry, says Mah

PUTRAJAYA, Oct 31: Smallholders should take advantage of the incentives announced in the 2018 Budget to adopt mechanisation, in a move forward to enhance production and reduce reliance on foreign workers in the commodity industry, says Minister of Plantation Industries and Commodities Datuk Seri Mah Siew Keong.

In the long-run, he said embracing automation was key to solving smallholders’ problems.

“There’s now incentives in terms of tax investment allowance for the rubber wood industry to encourage research and mechanisation.

“There’s also the RM100 million loan scheme to increase mechanisation and automation of the furniture industry. All this will reduce reliance on foreign workers.

“With mechanisation, long-term productivity will increase although there will be an upfront investment in the beginning, . I think in the long-term, we have to go for automation and mechanisation to increase the productivity of our industry,” he told Bernama News Channel on Monday in response to the 2018 Budget proposals tabled by Prime Minister Datuk Seri Najib Tun Razak in Parliament on Friday.

The prime minister’s proposals for the commodity industry included a RM460 million allocation for the welfare of rubber smallholders through the Monsoon Season Aid; RM140 million for oil palm replanting, new plantations and oil palm promotion; and RM100 million in loans for automating the production of local furniture, bound for export, with 70 per cent secured by the government.

The Monsoon Season Aid would benefit more than 500,000 smallholders and assist with rubber replanting schemes and infrastructure for latex production.
Mah said the inclusion of a replanting grant in Budget 2018 would spur replanting activities in Peninsular Malaysia and new planting in Sarawak.

“This is crucial as there was no replanting grant in 2016 due to budget constraints,” he said, adding that replanting was an important process to reduce costs in harvesting oil palm trees which were more than 25 years in the Peninsular.

“To encourage smallholders to replant, we must assist them with the RM7,500 grant to those in Peninsular Malaysia and RM9,000 for Sabah and Sarawak,” he said, adding the grant would be distributed in the form of seedlings, fertilisers and land clearing services.

Touching on the rubber sector, he said latex production should be increased as smallholders can obtain better income from latex instead of cup lump.

“To increase latex infrastructure, the government has allocated RM30 million. This is only one of the steps taken. In coming years, the government will inject more money for latex infrastructure,” he added.

Mah also expressed confidence that the budget would help the commodity sector to continue performing as Malaysia’s largest contributor in terms of net exports in 2018 by exceeding this year’s export target of RM130 billion.

Between January and August this year, RM93 billion worth of commodities were exported while export value increased 21 per cent.

“I’m also confident because we have managed to maintain crude palm oil prices during our current peak season.

“Today, the edible oil is fetching between RM2,700 and RM2,800 per tonne, which is reasonably good at this time of the peak production period,” he added.–Bernama





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