Malaysia’s Federal Land Development Authority (Felda) is introducing a new system to encourage its settlers to sell their palm oil harvest to the authority instead of third parties, hoping this will curb losses of some RM200 million annually.
Its chairman, Datuk Seri Ahmad Shabery Cheek (main image), described the sustainable oil palm collection centre at Felda Bukit Damar, located within the Mempaga territory in Pahang, as a “game changer”, as settlers will now be paid in cash, or receive their money online immediately — eliminating the need to sell their produce to third-party buyers.
“Wealth isn’t just about being rich, but sharing it with others, as ‘berkat‘ (blessing). In that spirit, I would prefer if we called this centre Damar Berkat, and hope this new system will lead to more blessings all around.”
“What is important here is that we have devised a transparent system that will benefit the settlers and Felda as a whole. This will certainly be a game changer — like how people were initially against (e-hailing company) Grab, but now everyone uses it,” Ahmad Shabery told reporters at the launch of the centre in Bukit Damar.
Under the new system, settlers will send their harvest to the centre, where it will be weighed and calculated on the spot. The figures will be recorded in the system, and settlers will be paid through their preferred method — cash or online transfer. The harvest will then be transported to nearby factories, using electric trucks, for processing.
This system will also allow Felda to track the transportation of the harvest, ensuring trips are made to Felda collection centres and factories, curbing leakages that have cost the land authority hundreds of millions of ringgit over the years.
Previously, settlers preferred selling to third parties, citing immediate cash payments, while selling to Felda would see them receiving their payments after two weeks — “if not more”.
Felda’s deputy director-general of plantations, Izham Mustaffa, recently said some settlers believed the price and extraction rate of palm oil was lower if sold to Felda factories, and thus opted to deal with third parties. He added that this opens the door to fraud, as some settlers are deceived with low prices, resulting in losses without their knowledge.
“This system is important, as it can also be used in other industries, such as paddy,” said Ahmad Shabery, who once served as the Agriculture and Agro-based Industry minister.
Payments will be managed by Koperasi Permodalan Felda Malaysia Berhad, while the transportation of harvest will be handled by Sustainable Future Sdn Bhd.
Ahmad Shabery added that this initiative is part of Felda’s ongoing digitalisation plan to ensure all parties — especially settlers — are involved. Pay sheets will also be digitalised, while aerial images of crops via drones will provide vital data.
Such data will help Felda and settlers make informed decisions — from fertiliser usage to land topography and identifying areas needing intervention to curb plant diseases.
Earlier in his speech, Ahmad Shabery said the opening of the collection centre in Bukit Damar would strengthen Felda’s palm oil industry ecosystem, ensuring it remains sustainable and benefits settlers in the long run.
“This is an important step to ensure the settlers’ hard work is managed with integrity and in a professional manner,” he said.
“The collection centre is not just infrastructure, but part of Felda’s bigger agenda in transforming the agriculture sector. Felda is committed to adding value to settlers’ produce, including through downstream processing and branding of Felda palm oil products in the future.”
Malaysia is the world’s second-largest palm oil producer after Indonesia and contributes significantly to the nation’s gross domestic product. Felda, through its subsidiary Felda Global Ventures, is among the top palm oil exporters in the country.
