MIRI: The Plantation Industries and Commodities Ministry wants to see more mechanisation in the plantation sector to reduce the amount spent on labour, especially foreign workers.
Minister Datuk Peter Chin Fah Kui said the ministry was worried about the high labour cost in the sector, as it now constituted some 40% of total production cost.
My ministry deals with many industries that are very labour-intensive, especially the palm oil industry.
The cost of labour takes up 40% of production cost. This is too high. We are trying our best to bring it down to 30% at least, he said yesterday.
Chin expressed particular concern over the surge in the cost of hiring foreign workers.
It is very expensive to recruit them due to increasing demand from them for higher wages, more overhead expenditure for their health examinations, levies and the cost of providing professional training for them, he said.
Chin, who is Miri MP, said the ministry was aggressively introducing mechanisation into the various stages of palm oil production, from the planting and harvesting to the oil extraction process to reduce dependency on manual labour.
Under Budget 2005, he added, his ministry had received allocations to provide for investment in modern machinery to boost efficiency and productivity in the various industries under its purview.
Companies that invest in machinery can recover the cost in about two years through better production and less spending on labour, Chin said.
Asked if the recent increase in petrol and diesel prices would hurt the various sectors under his ministry, Chin said the logging industry might feel the pinch because of higher transportation cost.