By Emmanuel Samarathisa
THE plantation sector is expecting to see a foreign labour crunch due to tighter movement restrictions stemming from the Covid-19 crisis.
Kim Loong Resources Bhd managing director Gooi Seong Heen said the major concern when the movement control order (MCO) eases would revolve around foreign labour supply.
“The only worry about longer-term repercussions is whether there will be sufficient foreign labour available before or after Hari Raya to perform estate operations satisfactorily,” he told FocusM.
After Malaysia announced the MCO, Indonesian publication Tempo on March 30 reported that thousands of Indonesian workers from Malaysia and Singapore landed in the Riau Islands. Citing a Riau Island administration spokesman, the paper said the island recorded 3,000 arrivals per day.
This concern was also echoed by research firm UOB Kay Hian. The country’s oil palm operations were “highly dependent” on overseas hands and those who left may only return after Hari Raya or end-May, the firm said.
It is also expecting stricter cross-border movement controls. “The control of incoming workers may remain strict to avoid importing Covid-19 cases. Hence, we foresee the risk of labour shortage that will lead to even lower production from Malaysia for 2020. Our current expectation is ~19.5 million tonnes for 2020 and this has to be revised down below 19 million tonnes with the disruption from MCO and potential labour shortage in the later stage.”
But some planters are unperturbed. IJM Plantations Bhd executive director and chief financial officer Puru Kumaran said he didn’t foresee any change from previous years. “At IJM, workers are not going out now, so there is no occurrence of any having to return,” he told FocusM. — April 9, 2020
