Fertilizer, Worker Shortages to Cut Malaysia Palm Oil Output
- Industry associations see output well below government target
- Efforts to bring in foreign workers not happening fast enough
Oil palm trees require a steady diet of nutrients and minerals. Malnourished trees produce less, which leads to lower oil extraction rates.
Photographer: Samsul Said/BloombergThis article is for subscribers only.
A hoped-for recovery in Malaysian palm oil output in the second half of the year is looking unlikely as the world’s second-biggest grower continues to struggle with shortages of fertilizer and workers.
The price of fertilizers, which make up about 40% of palm oil’s production cost, surged over the last year on logistics snarl-ups and then the Russian invasion of Ukraine. Prices have retreated over the last few months, but many growers struggled to buy enough earlier in the season, curbing yields.