Malaysian planters brace for migrant worker shortage + Hong Leong Bank

KUALA LUMPUR (Nov 7): While the public were focused on the plantation sector’s culpability in causing the haze hanging over the region in the last three months, Malaysian planters have been struggling with tight labour conditions in their estates, along with a high level of palm oil inventories.

The labour issue is a recurring problem for the country’s planters because locals shun estate work, which is considered dirty, dangerous and difficult (3D), and the migrant or foreign workers who take up these jobs return home after their contracts end. Furthermore, while certain tasks in the field are mechanised, harvesting the oil palm’s fruit, or fresh fruit bunches (FFB), still requires skilled workers.

Harvesters typically comprise Indonesians on most Malaysian plantations.

As such, oil palm plantations are heavily dependent on migrant workers who make up more than 70% of the sector’s workforce.

This high dependency on migrant workers has become a pain point for planters as they struggle to fill vacant positions in the field. On Oct 29, Minister of Plantation and Commodities Datuk Seri Dr Noraini Ahmad told Parliament that the palm oil sector is short of 30,000 workers. This works out to 11.16% of the number of migrant workers allowed to work in the plantation sector as at April 2026 this year.

Industry players that The Edge spoke with paint a mixed picture. While labour shortages may only be affecting certain pockets for now, all agree that they cannot afford a deterioration of the current situation, as they recall the disastrous effects of the severe shortage during the Covid-19 pandemic.

“The foreign labour situation in the plantation sector is becoming increasingly concerning,” says Roslin Azmy Hassan, CEO of the Malaysian Palm Oil Association (MPOA).

“While it remains manageable for some MPOA member companies, others are already experiencing shortages, particularly of oil palm harvesters. Our immediate concern is that if foreign worker recruitment is not facilitated now, the industry could face a much more serious labour shortage in the next few months.”

Read the story in Cover Story 1 in this issue of The Edge Malaysia. 

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