New business model by Felda

Felda will also be raising the initiatives to generate more income by diversifying into cash crops that are suitable and have high potential.

KUALA LUMPUR: Felda will formulate a new business model where the government will manage the settlers land through a long-term rental arrangement. New cash crops would be planted, all aimed at generating higher incomes for Felda settlers, said the White Paper.

By doing so, the Government will address the issue of aging settlers and the shortage of new settlers and ensure that the settler’s land is managed efficiently and on a large scale basis so that the economies of scale can reduce operating costs.

The success of the new Felda model hinges on the optimum consolidation of land and the new model is designed to give a profit to all parties, particularly the settlers.

Settlers will have to be comprehensively briefed so they understand the benefits of the new model for its ability to generate higher and consistent incomes. Settlers who are able and want to toil their land will be given the opportunity subject to the criteria that have been established. Felda will not stop those settlers from joining the new Felda model if they choose to.

Felda will also be giving their main focus to the core activity of plantations and will be the largest manager of farming land in the country.

Felda will also be raising the initiatives to generate more income by diversifying into cash crops that are suitable and have high potential. By doing so, this will raise the production of food, increase exports and reduce the country’s dependence on imported food.

The agency will also ensure that the replacement planting and livestock programme is able to generate a harvest within a short period of time that is able to deliver on cashflow fast and on a consistent basis.

Among the replacement plantings is fruits, vegetables and kenaf, which will help reduce the dependency on oil palm and rubber. That effort would be executed with the help of cooperation between government agencies and the private sector.

That effort needed to be executed given that the price of palm oil is dependent on world prices that are uncertain and subject to various risks such as low demand from importing countries, trade restrictions from a number of countries in Europe and also volatile CPO prices.

The replanting programme into different cash crops will also alleviate the pressure on settlers due to the fall in commodity prices.

The pioneer programme to diversify crops has been done by Felda Bukit Rokan and will be expanded to other lands in the Felda scheme with the cooperation of strkeholders and the private sector through integrated planting and urban industries.

Felda will be surrender the management of the settlers’ land to active cooperation so that it can be done on a large scale and more economically.

Through the new model, settlers who choose the long-term rental arrangement would receive a lease payment and dividends from the profits of the cooperation. This would enable the settlers to get a more consistent income.

The settler’s cooperative in each Felda scheme, including Koperasi Permodalan Felda Bhd, would be strengthened with the involvement of the original and new generations of settlers in the management, investments and businesses that are operated by Felda.

Through this system, Felda will also produce more professional farmers who can contribute to the progress of the Felda community.

The introduction of the new business model for Felda is also expected to address demographic issues of settlers where the majority are aged 60 years and above, do not have the ability to manage their estates and have been burdened with 

debt that needed to be explained to Felda. 

Accordingly, the management of the settler farms by the cooperative would enable old settler’s farm to run with more fair, efficient and profitable to both the settlers and Felda.

In addition, existing plant management systems will be reviewed and improved to enhance the efficiency and effectiveness that will provide benefits to settlers. This review will also pay attention to the issue overlapping of farm management functions to optimise resources.

The use of mechanisation and automation technology will be expanded to improve productivity and reduce production leakage. In addition, an effective crop monitoring system will also be created to monitor the harvests.

Through the adoption of the technology, planting and harvesting methods can be improved and thus improve crop yield, reduce dependence on low-skilled foreign workers and attracting participation Felda’s new generation to actively engage in plantation activities.

Felda will also move towards the use of the latest technology based on smart farming through the integration of the latest technologies more widely in the field of plantations that is aimed at increasing the quantity and harvest yield. 

The implementation of smart farming will enable Felda to increase food production and deal with the issue of imported food.