KUALA LUMPUR, Sept 11 — The total planted oil palm area is forecast at 5.64 million hectares, slightly up from 5.61 million hectares last year, said Deputy Plantation and Commodities Minister Datuk Chan Foong Hin.
He said this growth is mainly attributed to an increase in immature areas resulting from earlier replanting activities.
“In the first half of 2025, the palm oil industry generated RM53.43 billion in exports, a 9.3 per cent surge compared with the same period last year.
“Overall, the industry contributed 2.3 per cent to the national gross domestic product, underpinned by a smallholder network that cultivates 26.4 per cent of planted oil palm land and supports nearly 450,000 families,” he said during the opening ceremony of Agri Malaysia 2025.
However, he noted emerging structural challenges, most notably low replanting rates averaging only 2 per cent, falling short of the 4 per cent annual target, which poses long-term risks to productivity and export continuity.
“In response, the government has allocated RM100 million in matching grants for 2025 and is proposing a substantial RM1.4 billion five-year replanting fund (2026 to 2030) to bolster smallholder capacity and ensure our palm oil export base remains resilient and sustainable,” he said.
Chan said crude palm oil (CPO) production is projected to gain momentum, reaching at least 19.50 million tonnes in 2025, supported by several factors.
“First, improved labour availability through the government’s approval of a special foreign worker quota will help shorten harvesting intervals, thereby enhancing FFB yields.
“Second, stronger fertiliser application in 2024, enabled by higher CPO prices and lower input costs, is expected to boost yields and improve productivity in 2025.
“Third, we remain mindful of external risks, especially the current monsoon season, which may cause prolonged flooding in certain areas. Such conditions could damage palms, disrupt harvesting, and affect fruit quality, thereby weighing on production,” he said.
Speaking to reporters at the press conference, Chan said the ministry is encouraging farmers, growers and planters across Malaysia to explore new agricultural technologies, including automation, mechanisation and artificial intelligence (AI), to enhance productivity, cost efficiency and overall competitiveness of the sector.
“We encourage our farmers, growers and planters to use the latest technologies. The more people apply new technologies such as AI, the more cost-effective it will become.
“The government hopes to encourage this positive cycle so we no longer rely on foreign workers. This is the way forward towards automation and mechanisation,” he said.
Agri Malaysia 2025 is being held at the Malaysia International Trade and Exhibition Centre (Mitec) from today to Saturday.
Under the theme “Futuristic Innovative Agriculture”, the eighth edition of the Malaysia International Agriculture Technology Exhibition gathers 450 exhibitors, 650 booths, 900 brands and 13,000 trade professionals from 18 countries.
With a spotlight on palm oil, durian, fruits and vegetables, and highland and lowland agriculture, the exhibition reflects the strength and diversity of Malaysia’s agriculture, plantation and commodities sector.
