Palm Oil Mill Cut Foreign Labor Dependence by 33% in Four Months Using AI

Kuala Lumpur: Local palm oil mills should adopt artificial intelligence technologies to improve efficiency, reduce dependence on foreign labor, and lower operating costs.

Plantation and Commodities Minister Datuk Seri Johari Abdul Ghani said a palm oil mill in Kuala Kangsar that integrated AI into its production operations last year managed to reduce its dependence on foreign labor by 33%, saving $361,808 annually in operating costs within only four months.

He said that after adopting AI, the number of foreign workers fell from 66 to just 44, saving $248,743 in labor wages.

With an investment of only $1,130,645 in AI, the mill achieved annual savings of $610,551. This means the investment will reach break-even within two years, after which the facility will continue operating efficiently with AI support.

Johari added that the ministry and the Malaysian Palm Oil Board had received several proposals on AI technologies and remain open to adopting automation, artificial intelligence, and the Internet of Things to strengthen production capabilities through advanced technology systems.

His remarks came during the ministry’s closing session on the motion of thanks for the royal address.

The Titiwangsa MP stressed that there is no need to fear adopting AI in the sector, explaining that the technology can transform the industry from one dependent on foreign workers to one that employs more local workers.

He said these systems require local skills to monitor AI operations, and such jobs usually offer higher wages.

Jerangau Mill Closed Because of High Costs

Separately, in response to a question from Datuk Rosol Wahid (PN-Hulu Terengganu) about the closure of a palm oil mill in Jerangau because of high technology maintenance costs, Johari said there were two main reasons for the closure:

1. Insufficient supply of palm fruit for processing despite having a large number of workers.
2. Old machinery with poor efficiency in older mills.