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According to the a Malaysian Estate Owners’ Association (MEOA), Malaysia is missing a golden opportunity to capitalize on high palm oil prices and could suffer further production losses due to a “severe” shortage of about 120,000 workers.

The world’s second-largest palm oil producer is struggling due to a labor shortage exacerbated by pandemic-related immigration restrictions. Foreign workers, mostly from Indonesia, typically make up about 80 percent of the workforce on Malaysian estates, which stood at about 437,000 at the start of the pandemic.

Palm oil prices have reached record levels this year due to labor shortages, export limits on the main producer Indonesia, and the Russia-Ukraine war, but Malaysian producers are unable to take advantage of this.

The sad reality is that Malaysia is missing the golden opportunity that was presented to it on a silver platter, as it is unable to harvest oil palm clusters in the appropriate harvest shifts in the face of its current limited labor force.

In September, Malaysia approved the recruitment of 32,000 migrant workers for palm plantations, but the foreign labor has not yet entered the country due to permit delays.

The group said the industry’s projections for 2022 production of 18.6 million tons could fall further if labor does not arrive immediately.

Last week, the state agency Malaysian Palm Oil Council (MPOC) lowered its production forecast to 18.6 million tons for the current year, down from its previous estimate of 18.9 million tons.