PALM OIL BUSINESS IN MALAYSIA: BILLIONAIRES, GOD'S GIFT, MIGRANT LABOR

PALM OIL BUSINESS IN MALAYSIA

Wilmar palm oil processing

Malaysia is the world's second biggest palm oil producer and exporter, and its companies are also big players in neighboring Indonesia, the largest producer of palm oil. Malaysia would like to produce more palm oil, but it is running out of viable land for new oil-palm plantations, according to the US Department of Agriculture.

Malaysia produces about around 19.5 million tonnes of palm oil annually. It accounts for 28 percent of the world's palm oil production and 33 percent of global exports. In the late 2010s, palm oil was Malaysia’s fourth-largest export product, with the industry contributing billions of dollars annually to the national economy and accounting for a significant share of the country’s exports. [Source: Mei Mei, Reuters, July 29, 2020]

Malaysia’s palm oil plantations need about 1 million workers to keep them going and relies on foreigners for 70 percent of its plantation workforce, Palm plantations account for 18 percent of Malaysia's total agriculture area, and without sufficient labour, palm fruits may spoil. [Source: Mei Mei Chu, Reuters, May 21, 2020]

Boustead Plantations is one of the largest palm producers in Malaysia. It owns and leases a total of 48 oil palm plantation estates and 10 palm oil mills in Malaysia, according to its website. Its land bank consists of more than 98,200 hectares, of which 79,400 hectares are used for oil palm cultivation. Malaysia’s armed forces pension fund Lembaga Tabung Angkatan Tentera, the majority shareholder of Boustead Holdings, owns 12.1 percent of the plantations unit, according to data compiled by Bloomberg. [Source: Yantoultra Ngui and Elffie Chew, Bloomberg, July 7, 2021]

Palm is Malaysia’s most lucrative crop. According to the Washington Post: “In 2011, the export of palm oil and palm-based products netted $27 billion — a five-fold increase over the past decade — as a result of brisk trade with China, Pakistan, the European Union, India and the United States, which imported record levels that year. Palm oil accounts for 7 to 10 percent of Malaysia's GDP, making it the third largest income-generating natural commodity after petroleum and timber. Indonesia is the world's second largest palm oil producer. Palm oil became very profitable in Malaysia as the value of ringgit crashed after the Asian economic crisis in 1997-98.

Malaysia Rebrands to Stave Off International CriPalm Oil as “God's Gift' ticism

In July 2020, Malaysia announced that it would combat growing international criticism of palm oil with a new slogan: “Palm oil is God’s gift.” The slogan was introduced by the government as part of a campaign to defend the country’s palm oil industry against what officials described as unfair attacks, particularly from the European Union. Deputy Plantation Industries and Commodities Minister Willie Mongin said the slogan would be promoted both domestically and internationally.[Source: Mei Mei, Reuters, July 29, 2020]

The campaign replaced an earlier “Love My Palm Oil” initiative launched in 2019 to encourage national pride in Malaysian palm oil. Officials argued that palm oil had become an important pillar of the Malaysian economy and a key source of employment and export earnings. The government viewed negative international perceptions of the industry as a threat to rural livelihoods and economic growth.

Malaysia’s move came amid rising tensions with the European Union over environmental concerns linked to palm oil production. The EU had announced plans to phase out palm-based biofuels from its renewable energy program by 2030 and was considering stricter safety limits on food contaminants found in refined vegetable oils, including palm oil. Malaysian leaders said these measures unfairly targeted palm oil compared to other vegetable oils.

Environmental groups and activists had long criticized the industry, arguing that large-scale oil palm cultivation contributed to deforestation, habitat destruction, and threats to endangered wildlife such as orangutans and pygmy elephants. Palm oil producers, however, maintained that the crop was highly efficient compared to other oil-producing plants and that the industry was adopting more sustainable practices.

Malaysia’s Palm Oil Sector Suffers During Covid-19 Pandemic Due to Labor Shorages

During the COVID-19 pandemic, oil palm plantations across Malaysia faced severe labour shortages that disrupted production and forced estate managers to adopt unusual measures to maintain operations. At a large 2,000-hectare plantation in Slim River, Perak, watermelon seedlings were planted between young oil palm trees while rented cattle grazed in overgrown sections of the estate to help control vegetation. Plantation managers struggled to cope as restrictions on international travel sharply reduced the supply of migrant workers from Indonesia and South Asia, who traditionally formed the backbone of Malaysia’s plantation workforce. [Source: Mei Mei Chu and Naveen Thukral, Reuters, September 6, 2021

Malaysia experienced falling yields during the crisis despite global palm oil prices reaching near-record highs. Data from the Malaysian Palm Oil Board showed that average yields of palm fruit bunches and crude palm oil both declined significantly during the first half of the pandemic period. Many plantations operated with only two-thirds or less of their normal workforce, forcing harvesting schedules to stretch from the usual 14 days to as long as 40 days. The delays reduced fruit quality and caused losses as overripe fruit detached from bunches before collection.

Plantation operators said the labour shortage created major operational difficulties. Some estates postponed replanting programmes and closed nurseries so workers could be reassigned to harvesting duties. Managers also raised wages in an attempt to retain existing labourers. In Sarawak, some plantation companies reportedly suffered production declines of up to 50 percent because they lacked enough harvesters to collect fruit during the peak production season.

The Edge Malaysia

The shortage of workers also worsened pest infestations on plantations. Without sufficient manpower to maintain fields, pests such as rats, moths, and bagworms spread more easily. Plantation officials warned that bagworm larvae were stripping palm leaves and weakening fruit production. Overgrown vegetation also created ideal breeding conditions for rats and other pests, while natural predators struggled to keep populations under control.

The production disruptions contributed to tightening global palm oil supplies and rising consumer prices. Refining companies across the region reported sharp increases in the prices of both bulk palm oil products and packaged cooking oils. Analysts said the higher costs were being absorbed throughout the supply chain, from plantations to refiners and consumers. The pandemic highlighted the heavy dependence of Malaysia’s palm oil industry on migrant labour and exposed vulnerabilities in one of the country’s most important export sectors.

Palm Oil Billionaires in Malaysia

According to the 2026 Forbes Malaysia’s 50 Richest list, several of the country’s billionaires derive a substantial portion of their wealth from palm oil and related agribusiness activities. This reflects the central role of palm oil in Malaysia’s economy, particularly in plantation agriculture and global commodity trade. [Source: Forbes, South China Morning Post]

Among the most prominent figures is Robert Kuok, with an estimated net worth of about $13.6 billion as of April 2026. Widely regarded as Malaysia’s richest individual and often called “Asia’s Sugar King,” much of his wealth is linked to his stake in Wilmar International, the world’s largest palm oil processor, which he co-founded. His business interests also extend into shipping, property, and luxury hotels such as the Shangri-La chain.

Another major group of palm oil billionaires includes the brothers Lee Yeow Chor and Lee Yeow Seng, whose combined net worth is estimated at $8.5 billion. They inherited the IOI Group from their father, Lee Shin Cheng. Lee Yeow Chor leads IOI Corporation, which focuses on palm oil production, while Lee Yeow Seng heads IOI Properties, reflecting the group’s diversified holdings.

Lau Cho Kun, with an estimated net worth of $1.64 billion, is the largest shareholder in Hap Seng Consolidated, a diversified conglomerate with significant palm oil plantation operations, particularly in Sabah in East Malaysia. Similarly, Lee Oi Hian and Lee Hau Hian, with a combined wealth of around $1.6 billion, control Batu Kawan Berhad, a company heavily involved in palm oil plantations and oleochemical production.

Chia Song Kun, whose net worth is estimated at $2.1 billion, co-founded QL Resources. Although the company began as a fish paste producer, it has expanded into palm oil plantations and related activities, including livestock feed production, making it another key player in the sector.

Other influential figures in the palm oil industry include Kuok Khoon Hong, Robert Kuok’s nephew, who serves as chairman and CEO of Wilmar International and is often referred to as a “Palm Oil King” in global trade, although he is typically ranked among Singapore’s richest individuals. The family of the late Tiong Hiew King also maintains extensive interests in palm oil and timber through the Rimbunan Hijau group, further underscoring the importance of these industries in shaping regional wealth.

Wilmar, Palm Oil and Robert Kuok

Wilmar International Limited is a Singaporean investment holding company that provides management services to its over 400 subsidiary companies. Founded in 1991 and headquartered in Singapore, it is Asia’s leading agribusiness group. It also ranks amongst the largest listed companies by market capitalisation on the Singapore Exchange.

Wilmar is a major player in the palm oil business. As of 2010 it was: 1) the largest global processor and merchandiser of palm and lauric oils; 2) one of the largest plantation companies in Indonesia/Malaysia; 3) the largest palm biodiesel manufacturer in the world; 4) a leading consumer pack edible oils producer, oilseeds crusher, edible oils refiner, specialty fats and oleochemicals manufacturer in China; 4) one of the largest edible oils refiners and a leading producer of consumer pack edible oils in India; 5) the largest edible oils refiner in Ukraine; and 6) the leading importer of edible oils into East Africa and one of the largest importers of edible oils into South-east Africa. [Source: Wilmar]

Wilmar is largely owned by Chinese Malaysian tycoon Robert Kuok, Malaysia’s richest man with assets of $12.5 billion in 2013, according to Forbes. Forbes says: Kuok “made his money in sugar, palm oil, shipping and property. His Kuok Group boasts a huge network of companies under 3 main groups in Hong Kong, Singapore and Malaysia. Biggest source of wealth is his stake in Wilmar, the world's largest listed palm oil company. But the stock weakened during the past twelve months as palm oil prices slumped. Wilmar is run by his nephew, Kuok Khoon Hong, a Singapore citizen who's also a billionaire thanks to his 10 percent stake in the company. [Source: Forbes]

Wilmar commenced operations as a palm oil trading company in 1991, In 2006, it was renamed Wilmar International Limited. In 2007, it completed the merger with Kuok Group’s palm plantation, edible oils, grains and related businesses in a deal worth US$2.7 billion, as well as a restructuring exercise to acquire the edible oils, oilseeds, grains and related businesses At that time, Wilmar Holdings Pte Ltd (WHPL), included stakes in Archer Daniels Midland Asia Pacific (ADM) and its subsidiaries in these businesses. Also in 2007, Wilmar formed a joint venture with Olam International Ltd and SIFCA Group, one of Africa’s largest agro -industrial groups with significant interests across palm oil, cotton seed oil, natural rubber and sugar sectors in Africa.

In 2010 Wilmar acquired Australian conglomerate CSR's sugar business Sucrogen, world's fifth-largest sugar-refiner, for US$1.47 billion. In 2011, the first bio refinery plant for jets in Indonesia commenced operations under Wilmar leadership. It produced 500 tons of biofuel per day Q4 2012, 80 percent of it would be biodiesel while the rest will be bio-olefin, the most important components for aviation biofuel, although still needed further processing.

Wilmar’s Palm Oil Business

Wilmar engages in oil palm cultivation and milling, and is one of the largest oil palm plantation owners in Indonesia and Malaysia. Business activities include oil palm cultivation, edible oils refining, oilseeds crushing, consumer pack edible oils processing and merchandising, specialty fats, oleochemicals, and biodiesel manufacturing, and grains processing and merchandising. [Source: Wikipedia]

Wilmar's merchandising and processing segment encompass: 1) merchandising of palm oil and laurics-related products; 2) operations of palm oil processing and refinery plants; 3) crushing, further processing and refining of a range of edible oils, oilseeds, grains and soyabean. Its consumer products segment has oil bottling business in the People's Republic of China, Vietnam and Indonesia. Its plantation and palm oil mills segment engages in oil palm cultivation and milling. Other segment includes manufacturing and distribution of fertiliser and ship-chartering services.

According to Wilmar: “Our oil palm plantations are strategically located in the various regions of Malaysia and Indonesia where the climatic conditions are suitable for planting oil palms. In Indonesia, our plantations are located in Sumatra, West Kalimantan and Central Kalimantan (southern region) while in Malaysia, they are located in the states of Sabah and Sarawak. In addition, the Group also owns oil palm plantations in Ghana and through joint ventures, owns plantations in Uganda and West Africa. As at 31 December 2012, Wilmar had approximately 255,648 hectares (ha) of planted area of which about 73 percent is located in Indonesia, 23 percent in East Malaysia and 4 percent in Africa. [Source: Wilmar +=+]

“In addition to holding land rights to plantation land, we manage approximately 41,407 ha of oil palm plantation under the Plasma Scheme in Indonesia as at 31 December 2012. The Plasma Programme is an initiative designed for the development of oil palm plantations for smallholders by a developer of plantations. We are committed to purchasing all the fruits produced by the small landholders’ plantations. Wilmar intends to grow its plantation business through greenfield projects and acquisitions to tap on the growing demand for palm oil. “Apart from plantations, Wilmar also owns palm oil mills to process fruits from our own and surrounding plantations. The key products of oil palm cultivation and milling are crude palm oil and palm kernel which are sold to palm oil refiners or further processed by our Merchandising & Processing – Palm & Laurics operation. +=+

According to the Forest People’s Program: “Wilmar International is the world’s largest palm oil trading company valued at US$17.9 billion dollars. Through a raft of subsidiaries the Singapore-based company holds a ‘land bank’ of over 600,000 hectares, principally in Sabah, Sarawak, Sumatra and Kalimantan in Malaysia and Indonesia. It is also expanding its operations into Africa. It accounts for about 45 percent of all globally traded palm oil. [Source: Forest People’s Program\\]

About 30 percent of the crude palm oil that Wilmar processes in its huge refineries comes from its own estates while the rest is bought from other suppliers. It is estimated that less than 10 percent of the palm oil that it trades comes from its own estates and mills. Wilmar has received substantial support from the World Bank’s private sector arm the International Finance Corporation. \\

Wilmar’s Poor Environmental Record

In 2012, Wilmar was named the world's least environmentally friendly company by US news magazine Newsweek. According to Friends of the Earth Netherlands, Wilmar International starts forest fires and violates the rights of the local population. Due to their poor environmental performance they were excluded in 2013 from The Government Pension Fund of Norway, the largest stock owner in Europe.

According to the Forest People’s Program: “Wilmar’s operations have been widely criticised for failing to adhere to the law, for the take over of communities’ lands without their consent, for the clearance of forests without prior environmental impact assessments and for illegal burning. There are numerous land disputes between Wilmar subsidiaries and local communities, as well as conflicts over the way it treats smallholders. [Source: Forest People’s Program\\]

Since 2007, Wilmar, which is a prominent member of the Roundtable on Sustainable Palm Oil, has been seeking to reform its practices but new problems keep emerging. As part of a coalition with international and Indonesian NGOs and community based organisations, FPP has been helping promote dialogues with Wilmar aimed at securing community lands, resolving existing conflicts and preventing further abuses. We have also called on Wilmar to apply the RSPO standard to all the palm oil that it trades.

Three Malaysian Palm Oil Entities to Merge to Form Sime Darby Bhd

In January 2007, Malaysia’s three major plantation groups—Sime Darby, Guthrie, and Golden Hope—were merged into a single entity called Synergy Drive. In November that year, the company was renamed Sime Darby Berhad, forming a diversified multinational with about 104,300 employees and businesses spanning plantations, property, motors, heavy equipment, and energy and utilities. The merger created one of the world’s largest listed oil palm plantation groups, with strong downstream operations. In 2011, it reported revenue of $13.9 billion and net income of $1.2 billion. [Source: Associated Press , November 23, 2006]

Before the merger, analysts described the deal as a move that would create the world’s largest listed palm oil producer by output and market value, combining landbanks and improving efficiency across mills and refineries. The three companies together controlled about 1.3 million acres in Malaysia and Indonesia and produced over 2.1 million tonnes of crude palm oil annually, roughly 13 percent of Malaysia’s output. The combined business was also expected to generate annual revenue of about $2.02 billion and operating profit of $248 million.

Sime Darby traces its origins to 1910, when British businessmen William Sime and Henry Darby founded Sime, Darby & Co. in Singapore as a rubber trading company, later expanding into palm oil and cocoa. The group expanded during the colonial era before gradually shifting ownership to Malaysian interests in the late 1970s. By 1981, it had become fully Malaysian-owned following state-linked acquisitions, and its headquarters was moved to Kuala Lumpur.

Guthrie, founded in Singapore in 1821, was one of the earliest British trading firms in Southeast Asia and later introduced rubber and oil palm cultivation to Malaysia. It was listed in Kuala Lumpur in 1989 after privatization and restructuring under Malaysian ownership.

Golden Hope originated from British plantation investments in the early 20th century and was consolidated into Golden Hope Rubber Estate in 1905. It was later acquired by Malaysian interests in the 1980s and renamed Golden Hope Plantations Berhad in 1990. The company diversified beyond plantations into products such as glycerine and fruit juices, while maintaining estates in Selangor and expanding internationally through subsidiaries.

Sime Darby Accused of Using Forced Labor

Malaysia’s Sime Darby Plantation said it would investigate “serious allegations” of forced labour and child labour practices following claims raised by an activist group that has also petitioned U.S. authorities to block imports of its palm oil.The company, one of the world’s largest palm oil producers by land area, has become the latest Malaysian plantation giant to face scrutiny from overseas advocacy groups. Similar petitions were previously filed against FGV Holdings, highlighting ongoing concerns about labour practices in parts of the industry. [Source: Reuters, July 8, 2020]

The allegations were brought to the U.S. Customs and Border Protection by Hong Kong-based organisation Liberty Shared, which claimed it had identified indicators of labour abuse through worker interviews, civil society consultations, and reviews of public documents, audit reports, and sustainability disclosures. The group cited issues including alleged arbitrary penalties, inconsistent wage deductions, poor living conditions, and reports of harassment and intimidation.

Sime Darby Plantation rejected the allegations as inconsistent with its stated commitments to responsible sourcing and human rights. The company said it would engage with the group to better understand the claims and carry out a full investigation, adding that it would take corrective action where necessary. The palm oi industry depends heavily on migrant labour, with hundreds of thousands of workers from countries such as Indonesia, India, and Bangladesh employed across plantations.

Image Sources: Wikimedia Commons

Text Sources: New York Times, Washington Post, Los Angeles Times, Times of London, Lonely Planet Guides, Library of Congress, Malaysia Tourism Promotion Board, Compton’s Encyclopedia, The Guardian, National Geographic, Smithsonian magazine, The New Yorker, Time, Newsweek, Reuters, AP, AFP, Wall Street Journal, The Atlantic Monthly, The Economist, Foreign Policy, Wikipedia, BBC, CNN, and various books, websites and other publications.

Last updated May 2026