Wednesday, August 10, 2022


COCONUT (Cocos nucifera) in Malaysia are an important crop grown since long time ago. It is time for the local coconut industry to shine and having been overshadowed by oil palm for decades as claimed by industry observers. This is being driven by declining palm oil prices in long years ago and rising demand for coconut-derived products. But there are many challenges. For one, local coconuts cannot compete with imports in terms of price and scale. According to news reports earlier in this year 2020 in which the local coconut suppliers were calling for the government to regulate the import of coconuts. In their view whereby the influx of cheap coconuts from countries such as  Indonesia and Thailand was currently hampering their businesses. The lack of competitiveness and perceived insufficient supply is due to many farmers choosing to plant the more lucrative oil palm instead of coconut trees. For me the coconuts are Malaysia’s fourth largest industrial crop behind oil palm, rubber and rice with most of the large plantations found in Sabah and Sarawak. According to a report by the  Department of Agriculture Malaysia (DOA) that the country is among the top 10 coconut producers in the world although production fell between 2014 and 2016. Total acreage of coconut plantations had fallen from about 120,000ha in 2005 to 85,000ha recently. Meanwhile for the palm oil acreage and prices rose from 2006 to 2012 and recently from 2021 - 2022.  Prices went on a general downward trend (except for a spike in 2017) due to oversupply and weak demand from top buying nations. From the report recently, prices were impacted by the EU’s decision to avoid palm oil due to concerns of forest clearing and environmental degradation directly linked to oil palm cultivation. This had serious consequences as the region was the world’s second largest importer of palm oil. The declining palm oil prices have caused smallholders to suffer a lot, especially those who only have 1ha to 2ha of land. This article in "Anim Agriculture Technology" I share hoe the revival of coconut industry in Malaysia should be.

For Malaysia to accelerate the growth of the local coconut industry the government will have to play a big role in ensuring that consumers get a consistent and affordable supply of coconuts while also improving the livelihood of farmers. I also believes that the government is trying its best to strike that balance especially during festive seasons whereby the demand for coconuts usually soars. However if the Malaysian government can align its efforts to increase the local supply of coconuts and reduce the reliance on imports therefore this problem can be solved to a large extent. I think it is very important for the government to take this seriously and if Malaysia want to elevate the incomes of rural farmers therefore the need a good strategy, standards of procedures and proper monitoring by the relevant agencies. Many local farmers in the market are complaining that their coconuts cannot be sold. This occurrence not because of oversupply but a lack of strategy on how to market them. They need to have downstream system and proper collection centers and also distribution strategies for young coconut.

By the way the government budget allocation in few year currently was a good move with total budget amount that was actually enough. For farmers to replace all the old coconut trees with new ones need to apply through DOA for approval. Subsidies include land reparation, basic infrastructures  (drainage system and others), seedlings, fertilisers, chemical and technical assistance. With a large number of farmers nowadays working under the management of those entities such as Group farming, it can be easy to manage in terms of harvesting and to venture into the downstream sectors. The existing comprehensive strategy covering the entire value chain that was from the production of seedlings and increasing the number of plantations to education to improve farm management and encouraging the use of fertilisers. The government already play a leading role in providing assistance to farmers for at least five years and every RMK. While the private sector also has a role to play there are an initial stages will have to be funded by the government. Agencies such as Agrobank is trying its best to help entrepreneurs. But it cannot help everyone as it also has [qualification] criteria. With the existing projects involving high-value crops such as rock melons reported it is able to help. Farmers takes 3 - 4 years for a coconut plant to produce a yield compared with merely three months for rock melons. Coconut farmers able to earn supplement their income by planting bananas, chillies, water morning glory and okra in which have a short harvesting period while waiting for their first harvest. The coconut improvement industry in Malaysia is in progress, Thanks...

M Anem,

(July 2022)

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