Archive for 2010

From ‘Dolly Parton’ bunches to smaller, oil-laden ones

November 23, 2010 6 comments

For the last 40 years, Malaysia has tried a variety of ways to mechanise the harvest of oil palm fruits as the industry works to improve efficiency in the face of a worsening manpower shortage. 

Todate, the mechanisation of fruit evacuation remained largely unsuccessful. As a result, the industry has been working on the trees – to make them easier to harvest and to have more oil.

In the small town of Paloh, Johor, scientists have produced the next set of trees that could significantly improve the industry further. Not only are these trees easier to harvest, they will also have a fifth more oil from the current batch.

Buyers are coming from as far as Sarawak.

“I like what I see. It is easier to harvest and handle. The most important thing is, it will give me higher oil yield,” said one planter during a recent seed-buying mission to Applied Agricultural Resources Sdn Bhd (AAR)’s oil palm seed garden in Paloh.

Malaysia is now the world’s second largest palm oil producer after Indonesia. But data from the Malaysian Palm Oil Board is showing a worrying trend: palm oil output is likely to stagnate at 17.6 million tonnes for the third straight year in 2010.

Assuming this amount of oil is gathered across 4.9 million hectares, this year’s yield will only total 3.6 tonnes per hectare in a year. Many planters say this is due to a severe shortage of harvesters.

While the search for the best mechanisation system continues, Malaysian crop scientists are making headway in raising tree productivity.

In the past, as oil palm trees grew taller and taller, planters use very long poles to harvest the fruit bunches. This got many crop scientists thinking. Why not breed shorter palms that bear very big fruit bunches?

So in the 1960s, crop scientists introduced the hybrid called the Dura X Pisifera (DXP) as the standard planting material. As time goes by, many in the industry affectionately referred to the DXP hybrid as “the Dolly Parton type” because the trees are shorter and produce big fruit bunches.

Fifty years on, Malaysia’s oil palm landscape is mostly populated with Dolly Parton trees.

In an interview with Business Times, seed producer AAR is giving a sliver of hope for the industry. AAR research director Dr Kee Khan Kiang introduced the higher oil yielding semi-clonal hybrid called “AA Hybrida I”.

Compared with the Dolly Parton standard, the dwarf-like AA Hybrida I has more, albeit smaller, fruit bunches. It also has higher oil yields.

“One of the problems of big bunches is that the inner fruitlets do not have space to develop fully. In smaller bunches, however, the inner fruitlets have a greater chance to develop and ripen more evenly. Therefore, for the same weight, smaller bunches yield more oil,” he said.

It then became apparent – bigger is not always better.

Seed selection is crucial in oil palm planting because those who use seeds gathered from existing estates suffer from low yields no matter how many bags of fertiliser are applied to the trees.

Kee confirmed that the AA Hybrida I is “the cream of the cream” and can yield 20 per cent more oil than the previous generation of DXP seeds.

His team of scientists adopted the semi-clonal strategy to step up seed production while maintaining key qualities like the dwarf stature of the tree and high oil yield in the fruit bunches.

“Our semi-clonal seed production technology ensures clients get consistent quality in every seed they buy from AAR,” Kee said. “And the good thing is, for now, we’re not charging a premium.”

During the tour around the Paloh seed garden, planters from Sarawak witnessed firsthand how AAR scientists match-make oil palm trees, working daily to perfect Malaysia’s top cash crop with the latest breeding technology.

Another compelling feature of the AA Hybrida I is that its dwarf stature means more trees can be planted. It allows for a higher density of 148 trees in one hectare compared with the current standard of 136.

A smallholder, owning 1,000 hectares in Betong, Sarawak, noted the higher productivity per harvester in planting the AA Hybrida I. “This is good. When the palms start to bear fruit, I don’t need to hire as many harvesters like others and yet I can get more oil per hectare.”

AAR head of crop improvement Tan Cheng Chua concurred that at prime fruit bearing age, the AA Hybrida I, under good management and environment, is capable of producing 40 tonnes of fresh fruit bunches with 24 per cent oil extraction rate. That works out to be more than nine tonnes of oil per hectare in a year or 2.5 times higher than the country’s average yield.

AAR, an equal joint venture between Boustead Plantations Bhd and Kuala Lumpur Kepong Bhd, had started selling the AA Hybrida I two years ago. The company is now working on the AA Hybrida II that will see a further 25 per cent improvement in oil yield. It is scheduled to be launched in 2015.


Oil palm estate in Sarawak

November 17, 2010 1 comment
I came across this short film on youtube. It was filmed in Sarawak by 26-year-old Steven Yap and his childhood friend Tay Zhi Qiang (the actor). The film-makers tell a touching story of a son reminiscing over his father’s legacy — an oil palm estate.

Those who are not familiar with oil palm plantations tend to look at satelite pictures and assume it a sterile field of mono-crop. But to the people who live in the oil palm estates, there’s a fulfilling life of sunshine, rain, gentle breeze, tears, laughter and love.

Most of all, the oil palm estate is home to more than 300,000 families of small farmers in Malaysia.

Oil palm planters seek tax waiver

November 9, 2010 2 comments

Oil palm planters in Sarawak are appealing to the government for a waiver of the windfall tax on crude palm oil (CPO).

Oil palm planters in Peninsular Malaysia had been paying windfall tax when CPO prices went beyond RM2,500 per tonne in the cash market. Planters in Sabah and Sarawak will soon pay the windfall tax as the average monthly cash price surpasses RM3,000 per tonne.

Yesterday, CPO futures on the Bursa Malaysia derivatives market closed RM82 higher at RM3,273 per tonne.

In a statement released yesterday, Sarawak Oil Palm Plantation Owners Association (Soppoa) chairman Datuk Abdul Hamed Sepawi said it is unfair to levy a windfall tax on CPO, a commodity which is subjected to many factors in the international market beyond planters’ control.

“In the normal boom-and-bust cycle of commodity trading, a sudden jump in price is not considered a windfall,” he said.

He then explained the profitability of oil palm plantations depends on the age and productivity of oil palm trees.

“It takes 10 to 12 years before a new estate can recoup its initial investment. So, a newly-planted estate would still be losing money even if palm oil prices surpass RM3,000 per tonne,” he said.

Hamed said the formulation of the windfall tax is flawed because it is based on the CPO selling price instead of actual profits. “How can we pay windfall tax when we have not even made any profits?” he asked.

Palm oil is already the world’s most heavily-taxed vegetable oil, with oil palm planters having to pay 25 per cent corporate tax, cess amounting to RM13 per tonne of CPO, as well as 7.5 per cent and 5 per cent sales tax in Sabah and Sarawak respectively. Also, there are varying import duties in countries that buy palm oil.

When compared to businesses in other sectors that just pay 25 per cent of corporate tax, oil palm planters have had to pay more.

When all the cess and taxes are added up, planters in Peninsular Malaysia pay an effective tax rate of 26 per cent.

In Sabah and Sarawak, it is even more punishing. For every RM1 an oil palm planter in Sabah earns, he is paying 40 sen in total cess and taxes, while in Sarawak, the amount is 37 sen.

The truth about oil palms and carbon sinks

November 7, 2010 1 comment

FORESTS are often called “the lungs of the world” — huge carbon sinks absorbing carbon dioxide emitted by the industrialised world, and producing the oxygen we need to breathe.

At the same time, agriculture is seen as “polluting” in the sense that land clearing and development release greenhouse gas into the atmosphere, contributing to global warming.

Environmental organisations such as Greenpeace, Friends of the Earth and Wetlands International as well as their local affiliates take this view further by lobbying for a moratorium on planting oil palm on peat soil and the imposition of greenhouse gas criteria on palm oil exports.

In 2007, Wetlands and the Netherlands-based consultancy Alterra issued a report titled PEAT-CO2 assessment of CO2 emissions from drained peatlands in southeast Asia alleging the region’s peatlands are going up in smoke, emitting tonnes of carbon dioxide and causing global warming.

Kuching-based Tropical Peat Research Laboratory (TPRL) director Dr Lulie Melling argues that if such a claim is true, then millions of Sarawakians would have choked to death.

In reality, Sarawak’s oil palm plantations have been sequestering carbon dioxide and generating oxygen that goes back into the atmosphere while creating carbon sinks and stocks.

“People tend to forget that oil palms are trees and that they absorb carbon dioxide in the air, only to release oxygen and in the same process, convert solar energy into biomass,” says Melling in an interview in Kuching.

“Trees are trees, they function the same whether they are part of the forest or plantations.

“Since tree plantations are perennial, they are more efficient carbon sequesters than seasonal oilseeds like soy, rapeseed and sunflower. Oil palms can feed on year-round tropical sun and rainfall to create biomass, i.e. carbon stock, without any soil disturbance compared with seasonal oilseeds.”

When peer-reviewed studies by soil scientists were adduced at the Roundtable on Sustainable Palm Oil (RSPO) meetings, it became evident that reports containing alarmist predictions were founded on calculations riddled with statistical bias and lacking in real evidence.

Last year, Brinkmann Consultancy’s recommendation to include greenhouse gas emission from peatland as a criterion for RSPO certification was rejected. TPRL’s findings had, in part, showed soil respiration at oil palm estates planted in peat had lower greenhouse gas emissions than that of untouched peatland.

This is one instance where soil research allows you to differentiate facts from mistaken assumptions about planting crops on peat soil. Good soil management, be it peat or mineral-based, is the basis for sustainable food production.

Melling says that many of the current assumptions about tropical peatland were based on the understanding of temperate peatland research.

“Tropical peat is different from temperate peat. First and foremost, tropical peat is mainly woody material, whereas temperate peat is made up of spaghnum and sedges.”

The woody nature of tropical peat means there is higher lignin content. Lignin, being a more “recalcitrant” carbon than labile carbon of cellulose materials in temperate peat, highly influences the peat decomposition rate.

Furthermore, the acidic condition of tropical peat inhibits microbial population, indirectly slowing the breakdown rate and therefore greenhouse gas emissions. Heavy and frequent rainfall in Sarawak, which helps to maintain moisture content in the peat soil, also decelerates decomposition and carbon dioxide emission.

Melling goes on to explain that unlike the northern hemisphere where temperate peatland is developed for energy and horticulture, oil palm plantations in the tropical countries only use the peatland as a planting medium.

On current understanding that drainage of peatland for agriculture leads to large carbon losses from oxidation, Melling says it is “not entirely correct”. “Peat subsidence is also due to compaction, consolidation and shrinkage.

“Water management and compaction is a prerequisite to any agriculture development on tropical peatland. Consolidation of the peat increases bulk density and capillary rise, resulting in higher water-filled pore space of the peat. This leads to a more anaerobic condition, which results in a lower decomposition rate and less carbon dioxide emission.”

Over the years, Melling has found that people, who are ill-informed, jealous or have vested interests, tend to get offended when she speaks out on issues. At such highly-charged meetings, it helps to stick to a simple rule: “I just do my job; I don’t try to do someone else’s job, and I don’t let anyone else do my job.”

She takes a sip of tea and leans back on her office swivel chair.

“When I say I do my job, it also means I do not do someone else’s job. This is because scientists are not in the business of saving the world, nor are we vegetable oil salesmen. Science is about the process, not the purpose.” 

On not letting anyone else try to do her job, Melling attributes it to the highly politicised topic of climate change, especially on greenhouse gas emissions.

In many international conferences on tropical peatland management and greenhouse gas, she has witnessed how some activists and politicians, skilful at straw man arguments, were quick to label people they disagree with as “taking sides with greedy oil palm tycoons who do not care about the environment” and are “likely to condone widespread forest destruction”.

While most local scientists become silent when debates heat up and arguments get louder, Melling rises to the occasion.

Soon after she presents her data, it becomes apparent that the critics’ claims are full of speculations. 

Until today, these environmental activists and politicians continue to claim expertise in tropical peat despite having never waded into Sarawak’s itch-inducing and acidic peat swamps.

As early as 1995, Melling has been studying tropical peat. Despite escalating citations of her peer-reviewed research papers, she remains humble and says there is still much to learn.

Recently, Melling and her team at TPRL set out to verify whether a national park, logged-over forest and oil palm plantation absorb more greenhouse gas than they emit. 

Three 40m-tall Eddy Covariance towers were set up in an oil palm plantation in Sibu, a logged-over forest and Maludam National Park in Betong division.

They have built-in lightning protection and the sensors are fully powered by solar panels. 

These instruments measure carbon flux and concentration, wind, moisture, sunshine hours, rainfall, humidity, soil moisture and water table.

When asked to comment on Malaysia’s aspiration to become a knowledge-based economy, Melling says the government needs to allocate more funds for peat soil research. 

“Through Science, farmers are able to carry out sustainable agriculture that satisfies both the economic and environmental needs of food production.”

Replanting to boost yields

November 1, 2010 1 comment

THE government’s new replanting scheme will target 365,000ha of oil palms older than 25 years as the world’s No. 2 palm oil producer tries to lift flagging output, a top Malaysian industry official said.

Industry regulator Malaysian Palm Oil Board’s (MPOB) new chairman, Datuk Seri Shahrir Samad, said the scheme would take two to three years to complete and that the government had allocated RM297 million under the 2011 Budget.

The scheme is the latest initiative to boost yields in the country, which has fallen behind top producer Indonesia in terms of output. An earlier industry-funded scheme to replant 200,000ha in 2008 in a bid to boost slumping prices was almost completed this year.

“I think we can easily achieve 17.5 million tonnes (in 2011) even with this new replanting scheme as there will be more young oil palms coming into maturity,” Shahrir said in his first interview with the foreign media as MPOB chairman.

Shahrir’s forecast was 4.9 per cent lower than the government’s production target of 18.4 million tonnes for next year, and roughly the same as his projection of 17.5 million tonnes for this year. “I don’t think there will be a drop in production even after the erratic weather this year. The younger trees are quite resilient,” he said.

Early this year, El Nino-driven hotter weather dried up yields and lifted the Malaysian benchmark palm oil prices, which have gained almost 15 per cent so far this year. The weather condition was quickly followed by La Nina, which brings more rains and floods to southeast Asia that can complicate harvesting and transport of the palm fruits.

Malaysia exports almost 90 per cent of its output. Last year, Malaysia derived RM37 billion from crude palm oil exports and RM13 billion for refined products and oleochemicals.

Shahrir said the government would allocate up to RM127 million to further develop the refining and oleochemical industries, with aid mostly targeted at Sime Darby Bhd , IOI Corp Bhd and Kuala Lumpur Kepong Bhd (KLK) – the top three palm oil companies in the country.

The MPOB is proposing mandatory green standards to ensure palm oil does not come from estates that expand by felling forests and marginalising local communities, Shahrir said. The MPOB has had a code of practice for palm oil firms to halt environment pollution since 2007, which firms such as IJM Plantations Bhd, Genting Plantations Bhd and KLK have adopted.

“The code is similar to the RSPO’s principles and criteria,” Shahrir said, referring to the industry-driven Roundtable on Sustainable Palm Oil that has produced a certification system whose participants have to commit to to preserve the environment.

“The industry has asked that we keep this code voluntary like the RSPO, but we are also in discussions with the government on starting an audit body to look at the industry, to ensure that the standards are met,” Shahrir said ahead of the RSPO conference in Jakarta, next week. — Reuters

IOI boss: More foreign workers needed

October 30, 2010 2 comments

The government should allow plantation companies to hire more foreign workers to harvest oil palm so as not to crimp the country’s palm oil export earnings, a top industry executive said.

Malaysia’s palm oil output is expected to stagnate at 17.6 million tonnes for the third straight year, according to industry observers.

The Malaysian Palm Oil Association, Malaysian Estate Owners Association and Sarawak Oil Palm Plantation Owners Association have been complaining of acute shortage of harvesters for the past three years. They blamed it for the lower palm oil output and export opportunity loss of some RM10 billion a year.

IOI Corp Bhd executive chairman Tan Sri Lee Shin Cheng yesterday reiterated the call for the government to be more flexible in permitting plantation companies to hire skilled harvesters from Indonesia.

“The trees are fruiting, but there’s acute shortage of harvesters and this is affecting the country’s palm oil export earnings.

“The industry has been finding ways to mechanise for the last 40 years and the reality is it is difficult to mechanise. If it were that easy, we would have done it a long time ago,” Lee said.

He was speaking to reporters after IOI’s shareholder meeting in Putrajaya. Also present was his son, Datuk Lee Yeow Chor, who is IOI’s executive director.

The older Lee sees palm oil prices rising further, possibly topping RM3,400 a tonne by the first quarter of next year, as global consumption exceeds supply. “Global palm oil consumption is going up, even in developed nations like the US, Europe and Japan. It is not just in China and India,” he said.

Lee also sees CPO prices trending higher if the current floods in Asia worsen. “The current RM3,000 per tonne level does not take into account the prospects of La Nina. If you did, then the RM3,300 to RM3,400 level is not a dream but a reality.” Yesterday, palm oil futures on Bursa Malaysia Derivatives fell RM24 to close at RM3,061 a tonne.

Four months ago, Indonesia signed a US$1 billion (RM3 billion) climate deal with Norway, under which it agreed to impose a two-year ban on new permits to clear forests. While the Indonesian government has not defined which type or location of forests come under the moratorium, it was reported that oil palm expansion could continue on some six million hectares of degraded and abandoned agricultural land across the country.

Yeow Chor said IOI will continue to invest in Indonesia. “The moratorium is said to limit new concessions, not existing permits,” he remarked.  On IOI’s capital expenditure, he said the group had allocated RM150 million for new plantings and replanting of oil palms.

Some RM30 million has also been set aside for a potential 30:70 joint venture with China’s Zhong Seng Oil & Grains Co Ltd to set up a refinery in Kuantan.

I’ll show you how to use your holes

October 24, 2010 2 comments

Women in male-dominated professions often have to work twice as hard to attain equal standing. Soil researcher Dr Lulie Melling is one such feisty lady who is willing to wallow in peat swamps, all for the sake of science.

THE MATING CALL of frogs filled the darkened seminar room in Finland. The sound came from the laptop of a Malaysian soil scientist, there to introduce the wonders of tropical peat to her peers in Europe.

Just as Kuching-based Tropical Peat Research Laboratory director Dr Lulie Melling moved into another slide to show the brackish water at peat swamps, someone in the crowd joked that women scientists would most likely scream at the prospect of roughing it out in the deep swamp peats.

Unfazed, Lulie smiled and told the predominantly male audience: “In my hole, the men will scream first”.

A master of double entendre, she explained to the sniggering crowd that many women scientists in Sarawak have, without hesitation, waded into swamp peats to collect samples while male engineers stepped back cringing, their arms folded.

As proof, Lulie showed photos of herself in inky-black pits. She recalled shivering from the cold and putting up with the itch that comes from being submerged in the mildly acidic grime when collecting samples.

There were times when peat muck gripped her shoe soles so solidly that she had to be hoisted out by several people. She showed another photo of herself covered in a heavy layer of black silt up to her neck.

Lulie was in the Finnish city of Jyvaskyla five months ago, bidding to host the International Peat Congress in 2016 (IPC2016) in Kuching, Sarawak. Having won the bid, Lulie said Malaysia can now leverage on this opportunity to draw the international peat scientist community to Kuching to gain a better insight on tropical peat development and conservation.

In an interview with New Sunday Times, Lulie said her quest to study tropical peat started in 1995. She was puzzled by the sago trees’ stunted growth in Mukah, Sarawak. At that time, nobody really knew or cared about what she was doing in the peat swamps. But all that changed when soil science became increasingly linked to the highly-politicised topic of climate change.

As the Internet became flooded with news reports and blog postings claiming that oil palm planting on tropical peat soil contributed to pollution and global warming, the search for credible soil studies also intensified.

Lulie pressed on with her research and in 2005, made an unusual discovery.

Her test results showed greenhouse gas emission from the peat soil planted with oil palm trees was less than that in untouched forest peatland. Her findings caught the attention of other researchers. Since then, citations of her research papers have gone up 10-fold in the last five years. Despite the international recognition, Lulie said there was still much to learn.

Apart from being technologically savvy, soil scientists needed to be physically fit to embark on remote excursions into mosquito-ridden swamps.

Lulie and her team often have to hike through slushy terrain to collect samples and data in the scorching sun and torrential rain.

With heavy scientific equipment in their knapsacks, they sometimes have to forgo tents and sleeping bags. As dusk sets in, they source wood scraps from their surroundings to build temporary shelters and toilets.

But Lulie and her team attest that what was most painful and frustrating was the time away from family and friends.

“Success in most professional careers requires long hours. Long gone are 9am to 5pm days. If you are not present at least 60 hours a week, then you are slacking,” she said. She paused for a while to gaze at a photograph of her family on her office desk. “I’m very grateful my husband and son are very understanding.”

A dedicated government officer, Lulie also organises soil science seminars for farmers throughout Southeast Asia. Her easygoing and jovial nature helps bridge the gap between scientists and rural folk.

Lulie first learnt that humour worked to her advantage when she organised a soil science seminar titled “Big hole, small hole & KY jelly” in 2007. It was a hit among local oil palm planters and even got the attention of more than a handful of chief executives of multi-billion dollar plantation companies from Singapore and Indonesia.

Scientists from Indonesia, the Philippines, Thailand, Japan, Fiji, Iran, and the United Kingdom flew in to learn that when peat soil is compressed by heavy machinery, oil palm roots are able to take stronger hold of the soil and feed on water and nutrients more efficiently.

A British professor came away from the field trip surprised that soil scientists in Malaysia were just as conscientious as in Europe on the need for sustainable peat development.

Lulie’s second seminar, in 2008, also sensationally titled “I’ll show you how to use your holes” was even more popular. Close to 700 participants learnt how to manage the water table and nutrient supplements in a variety of tropical peat fields.

Just as she is well-liked by rural farmers, Lulie is increasingly seen a role model among secondary schoolgirls in Sarawak. Her advice to young women who want to pursue a career in science: “Don’t be afraid to venture into uncharted territories. There’s no point re-inventing the wheel.

“Having scientists who are willing to venture out of the status quo is what drives significant discoveries,” she said.