Oil Palm Industry Economic Journal Vol. 15 (1) March 2015 p. 1-7

The Effects of Establishing Sustainable Oil Palm Growers’ Cooperatives on the Incomes of Oil Palm Smallholders

Azman Ismail*; and Nazirah, C J
Received:    Accepted:    Available Online:


This article attempts to study the impact of establishing Sustainable Oil Palm Growers Cooperatives (KPSM) on the incomes of oil palm smallholders in Malaysia. In the study, data on income were collected from members as well as non-members of KPSM in Saratok, Sarawak. The study found that the nett average fresh fruit bunch (FFB) price (after deducting transportation cost) obtained by KPSM Saratok members was higher than for non-members. For example, in July 2012, the average nett price obtained by KPSM members was RM 524.80/t compared with RM 414.60/t obtained by non-members. The price difference was RM 110.20. During this period, from July 2012 until April 2014, the average nett price obtained by members of KPSM Saratok was RM 410.80/t while non-members received a price of RM 345.50/t. The average price difference in that period was RM 65.30/t. Greater efforts have to be made to attract more independent smallholders to join the cooperatives as the cooperative is an institution that can help increase productivity and income of smallholders.

Keywords: cooperatives, oil palm smallholders, income, quality

About Post Author


* Malaysian Palm Oil Board,
6 Persiaran Institusi,
Bandar Baru Bangi,
43000 Kajang, Selangor, Malaysia.

E-mail: azman@mpob.gov.my