The agricultural risks brought about by the El Nino phenomenon, which is expected to strengthen between June and August this year and persist into early 2027, are particularly severe, says Natural Resources and Environmental Sustainability Minister Datuk Seri Arthur Joseph Kurup.
“Key commodity sectors like palm oil and rice paddies are at risk of a 10% to 18% yield reduction due to extreme heat stress and prolonged droughts,” he said in his opening remarks at the Malaysia Palm Carbon Conference 2026 held at Menara Felda in Kuala Lumpur in June.
“Coupled with increased risks of heatstroke, potential forest fires and haze, these compounding crises directly threaten our public health and food security.”
The minister said that with nationwide rainfall anticipated to drop by 40% to 60% in some areas, this prolonged dry spell could push 2026 or 2027 to surpass 2024 as the warmest year on record.
The extreme weather also endangers the country’s water reserves, he added.
Elaborating on the agriculture-specific efforts to address climate change, Arthur said agriculture is both affected by climate change and capable of contributing to climate solutions.
“Sustainable land management, carbon sequestration, methane reduction, circular economy practices and biomass utilisation all present opportunities to reduce emissions while supporting economic growth and rural livelihoods.
“This is particularly relevant for Malaysia’s oil palm sector. As one of the world’s leading palm oil producers, Malaysia has developed significant expertise in sustainable plantation management, certification systems, biomass utilisation and methane capture technologies,” he said.
Delivering a speech on behalf of Malaysian Palm Oil Board (MPOB) director-general Datuk Dr Ahmad Parveez Ghulam Kadir, MPOB acting director-general (research and development) Dr Mohd Hefni Rusli said beyond oil production, oil palm plantations continuously absorb carbon dioxide throughout their productive lifecycle.
“The industry also generates substantial biomass resources, including empty fruit bunches, fronds, trunks, palm kernel shells, mesocarp fibre and palm oil mill effluent, all of which represent valuable resources within a circular economy framework.
“These resources offer significant opportunities for carbon reduction, carbon storage, renewable energy generation and the development of new bio-based value chains,” he said.
One of the most immediate opportunities, Mohd Hefni said, is methane capture from palm oil mill effluent, with the biogas utilised for electricity generation, thermal energy applications or upgraded into higher-value renewable fuels.
Oil palm biomass, meanwhile, can be converted into bioenergy, biochar, compost, biomaterials and biochemicals, he added.
Describing Felda settlers as “frontline climate contributors”, Felda chairman Datuk Seri Ahmad Shabery Cheek said in his speech that managed oil palm land, measuring at almost 1 million hectares, are carbon assets.
“Every palm that absorbs carbon from the atmosphere, every biogas plant that captures methane, every plant that recycles our biomass into organic fertilisers, every biodiesel programme that displaces fossil fuel – these are Felda’s contributions to the global climate effort and we would like to be the catalyst of nurturing the principle of circular economy,” he said.
Oil palm is not merely an agricultural story, but also an energy security story and a climate story, Ahmad Shabery said.
“The recent elevation of our biodiesel mandate to B15 – blending 15% palm-based biodiesel into our national fuel supply – is not a footnote.
“It is a statement of intent. Every litre of diesel that flows through a Malaysian pump now carries within it a fraction of the sun, the soil and the labour of our smallholders.”
