Key Focus Areas

  1. Palm oil upstream and midstream
  2. Renewable energy through biogas capture and conversion
  3. Agribusiness: pineapple, other crops, smart farming and livestock

What We Do

We are principally involved in upstream and midstream oil palm operations with plantations in Johor, Malaysia and South Sumatera, Indonesia; and five mills in Johor to extract CPO and PK. In addition, we own and manage pineapple and coconut farms, and have embarked on smart farming. We are also involved in the livestock business.

In efforts to extract optimal value from our plantation operations, as well as to reduce our carbon footprint, we capture biogas for conversion into energy.

Kulim Group’s plantation landbank covers 74,575 ha of which 60,064 ha (or 81%) are in Southern Peninsular Malaysia, and 14,511 ha in South Sumatera, Indonesia, where the Group has been granted cultivation rights or Hak Guna Usaha (“HGU”) status.

As of 31 December 2020, 63,509 ha of the Group’s landbank were planted with oil palm, of which 56,147 ha were located in Malaysia. The total planted area of mature palms stood at 53,667 ha, of which 49,945 ha were in Malaysia and 3,722 ha in Indonesia.




During the year, we continued to focus on enhancing operational and cost efficiencies across our estates. This was especially pertinent given the labour shortage resulting from international border closure. About 73% of our plantation workers come from Bangladesh, India and Indonesia. While a number of them were able to return to their home countries during the year, from March onwards, we were unable to bring in fresh hands to maintain an optimum number in our plantations. The effects were most evident during harvesting, which is one of the most labour-intensive aspect of our estate operations.

Our In-Field Data Execution and Analytics System (“IDEAS”) and GIS/GPS Integrated Estate Management System (“GEMS”) contributed to added efficiencies by recording important data such as daily workers’ attendance, bunch count and loose fruit collected, among others.

Operational Performance

  • Planted area increased from 47,230 ha in 2019 to 56,147 ha due to the acquisition of 8,917 ha through the lease of four JCorp estates.
  • 1,237 ha of palm above 25 years was replanted with young high-yielding Kulim/Dami cross and a clone. The replanting was undertaken on a staggered basis to maximise each crop’s potential before felling.
  • Malaysian operations produced a total of 1,145,090 tonnes of FFB, a 26% increase from the 907,188 tonnes in 2019.
  • Yield Per Hectare (“YPH”) increased to 22.93 tonnes from 21.69 tonnes in 2019, exceeding the industry averages for Johor and Peninsular Malaysia at 20.14 tonnes and 17.76 tonnes, respectively.

Key Iniatives

Key Initiatives Achievements/Expected Outcomes
Entered into an agreement to lease four estates totalling 8,917 ha from JCorp for a period of 45 years. Bukit Payung Estate, Tunjuk Laut Estate, Pasir Logok Estate and Bukit Kelompok Estate will be managed by MPSB, a whollyowned Kulim subsidiary. FFB output from the leased land is expected to be in the region of 190,000 MT per annum.
To make up for loss of foreign workers following the MCO, Kulim undertook the following:
• Utilised all available male workers for harvesting work.
• Collaborated with the Labour Department in Peninsular Malaysia to organise job fairs to attract more local workers.
• Recruited 200 Malaysian workers from nearby villages.
• Introduced a Working Permit Incentive Scheme of RM100 per month for all foreign workers who prolonged their stay and continued working with us.
• Engaged with KJRI, Johor Bahru to advise Indonesian workers to postpone their planned return home.
Recruited about 160 foreign workers and 214 local workers, adding up to a total labour force of 5,240 in Malaysia
Increased mechanisation with greater use of the bin system for internal evacuation. The bin system covered 16,810 ha as at end 2020, from 4,478 ha at end 2019.
Continued to adopt and enhance Good Agricultural Practices (“GAP”) and Operational/ Manufacturing Practices Successfully contained our field costs at RM257 per tonne of FFB, 13% less than the budgeted cost of RM295 per tonne

Challenges and Mitigating Actions

Challenges Mitigating Actions
Fluctuations in commodity prices.
  • Focus on productivity improvement and cost efficiency without any compromise on quality and standards.
Labour shortage, with MCO preventing the intake of any foreign workers
  • Organised job fairs to attract more local workers.
  • Engaged KJRI to advise Indonesian workers to postpone their return home.
  • Introduced a Working Permit Incentive Scheme of RM100 per month for all foreign workers who prolonged their stay


Our mill operations were also impacted by the labour force shortage and interruption of operations due to MCO. The manpower shortage hampered the recovery of loose fruit during the harvesting period. Together with higher rainfall, this contributed to lower oil extraction and kernel extraction rates.

Nevertheless, we are making good progress on our renewable energy agenda, based on capturing gaseous emissions from Palm Oil Mill Effluent (“POME”) for conversion into energy. This year, we introduced our fourth biogas plant in Palong Cocoa POM. However, the plants in Sedenak POM and Sindora POM have been closed for repairs/upgrades since October 2018 and March 2019, respectively.

Currently all the biogas produced is used internally for power generation. However, we have plans to commercialise our biomethane as an added source of revenue.

Towards this end, we are setting up a biomethane plant at Sedenak POM, and bio-CNG plant in Tereh POM, both expected to be commissioned in the first quarter of 2022. A fifth biogas plant will also be set up and commissioned in Tereh POM in the first half of 2021.

Operational Performance

  • Processed a total of 1,501,949 tonnes of FFB, including 362,875 tonnes from external suppliers. This marked a 5% increase from 2019, mainly from increased Group supply.
  • CPO production totalled 316,066 tonnes, a 2% increase over 309,867 tonnes in 2019.
  • PK production increased by 3%, from 77,108 tonnes to 79,711 tonnes.
  • Oil Extraction Rate (“OER”) decreased to 21.04%, from 21.66%, yet remained higher than the industry average of 19.68% for Peninsular Malaysia and 19.92% for Malaysia as a whole.
  • Kernel Extraction Rate (“KER”) decreased to 5.31% from 5.39% in 2019.
  • Total biogas production increased by 83% from 3,781,857 m3 in 2019 to 6,930,104 m3.
  • Total of 20,338 tonnes of palm shells and 13,006 tonnes of palm fibres were sold for use as renewable sources of energy. Compared to 2019, the volume of shells sold was 2,676 tonnes higher while that for palm fibres was 3,836 tonnes lower.

Key Initiatives

Key Initiatives Achievements/Expected Outcomes
Increased Pasir Panjang POM capacity from 45TPH to 60TPH The project was completed two months ahead of schedule, and a license to process at 60TPH was awarded by the Department of Environment (“DoE”) in October 2020.
Embarked on a five year programme to increase the capacity of our 28 digesters from 4,000 litres to 5,000 litres Four units were converted in 2020, which are expected to increase our CPO output by 600 tonnes per annum, representing a 0.04% increase in OER.
Programme to enhance air pollution management at our mills, launched in 2016 The programme was completed in 2020, with the installation of Electrostatic Precipitator systems in our last two mills in January and July.
Installation of tertiary treatment plants at Palong Cocoa POM, Sedenak POM and Tereh POM All our mills now comply with a new DoE requirement on the treatment of wastewater discharge.
Upgrade of biogas plant in Sedenak to process all POME produced by the mill into biomethane to be injected into Gas Malaysia’s Natural Gas
Distribution System (“NGDS”) network
The project is expected to be commissioned by first quarter of 2022 to produce an estimated 250,000 MMBtu of biomethane gas per annum.

Challenges and Mitigation Actions

Challenges Mitigating Actions
Limited mill capacity, restricting the production of CPO Increased Pasir Panjang POM capacity from 45TPH to 60TPH
Mill operations cause air pollution, impacting the quality of air surrounding our operations. Completed a programme to install
Electrostatic Precipitators in all five mills.



Since being granted cultivation rights or HGU status in two plantations in South Sumatera in 2016, our subsidiaries have undertaken an extensive rehabilitation of 7,362 ha of the land; 4,248 ha by PT Rambang Agro Jaya (“PT RAJ”) and 3,114 ha by PT Tempirai Palm Resources (“PT TPR”). The rehabilitation programmes were completed in October 2018 and July 2018, respectively, following which crop recovery has improved significantly. As part of the rehabilitation process, our subsidiaries are also developing the physical infrastructure in the estates.

Operational Performance

Both estates produced a total of 14,499 tonnes of FFB in 2020, representing a production yield of 5.24 tonnes per hectare from a harvesting area of 2,766 ha. This marks a 42% improvement over 10,198 tonnes in 2019. The Group anticipates that the entire 7,362 ha of rehabilitated area will be producing harvests by 2022, and that, by 2025, FFB production will stand at 75,773 tonnes per year.

Key Initiatives

The most significant initiatives undertaken during the year were related to enhancing our estate infrastructure, which included:

  • 42 Reinforced Concrete (“RC”) bridges, a workshop, a fertiliser store and 1,084 foot bridges.
  • Physical protection for a water pump and a genset to minimise disruptions to operations.
  • 162km of laterite field roads


  • 40 RC bridges, a workshop, a fertiliser store and 984 foot bridges.
  • 118km of laterite field roads.

Challenge and Mitigating Actions

Challenges Mitigating Actions
Area prone to fire breakouts
  • Constructed water catchment measuring 20m x 20m x 4m.
  • Set up fire monitoring towers for every 500 ha of plantation; and a station for the
  • Team Kesiapsiagaan Tanggap Darurat (Fire Emergency Response Team). Monitoring from the towers complements routine patrolling.
  • Ensure fire extinguishing equipment fully comply with government regulations.
Slow recovery of plantation operations after rehabilitation work Implementation of best agricultural management practices to expedite return to normal productivity and yield.
Unpredictable climate patterns with prolonged monsoons and dry periods affecting yield as well as potentially damaging plantations Continuous training to alert workers and surrounding community on managing fires as well as improving the water management system to prevent flooding
Some of the palms were stunted, especially those with hanging bases • To improve palm base with soil mounding.
• To plan early replanting for area with substandard palm
Frequent claims on the land from the surrounding community despite HGU certificate To follow legal procedures on any land claim matter.



Supporting our plantation businesses as well as renewable energy ventures, we invest in Research and Development (“R&D”), which is carried out at the newly completed Kulim Agrotech Centre (“KAC”) located in Kota Tinggi, Johor. KAC houses five operating units, namely Tissue Culture, Genomic Laboratory, Plant Breeding Laboratory, Ulu Tiram Central Laboratory (“UTCL”) and R&D Management Office (Agronomy Advisory and Plant Breeding Office).Research on agronomy and plant breeding is carried out at the R&D Management Office, which also has a microbiology lab.

In addition, we collaborate with the MPOB and Malaysian Nuclear Agency on various agricultural-related areas of research.



The Agronomy Unit contributes to better soil management and crop production. With over 40 years of experience, it enables Kulim to gauge the performance of different planting areas more effectively, providing analysis and recommendations on best practices, identifying sites for new agronomy trials and recommending measures to overcome pest and disease outbreaks. Its research findings are shared with estates across the Group to enhance field performance, benchmarked against the high-performers.

Key Initiatives and Achievements

Key Initiatives Achievements
High performing estates
  • Sg. Papan Estate achieved outstanding FFB production of 30.02 tonnes/ha in 2020. In 2017, eight out of 12 mature fields produced over 26 tonnes/ha. Due to yield cycle, only six and seven fields hit 26 tonnes/ha in 2018 and 2019, respectively. In 2020, however, 11 fields produced more than 30 tonnes/ha.
  • Pasir Logok Estate, meanwhile, produced an average yield of 29 tonnes/ha.
  • Taken as a whole, the Group’s yield stood at 22.93 tonnes/ha, among the highest in the industry
Analysis of water contamination
  • In May 2020, R&D through the Microbiology Lab launched a new service to analyse the level of coliform and Escherichia coli (types of microbes) in water supplied to local communities. A total of 355 water samples have been tested.
Enhance services for better yield
  • Microbiology Lab started producing a beneficial microbe, mycorrhiza, which has proven to be as effective as commercial products in improving plant vigour thus strengthening them against diseases. A total of 3,000kg of the product has been produced to date.
Provide digitised mapping and palm counting through UAV services
  • Our inhouse remote sensing unit has successfully digitised palm counting of 5,624 ha of area in 2020. The resulting digital map will provide palm census reports with >99% accuracy.
  • Aerial images ensure accountability to palm census report.
  • Estates will be able to pin-point areas for supplying new palms to replace dead ones.
  • Precision fertiliser application can be practised.
Exploring other valuable crops
  • Started pursuing a second collaborative study with Malaysian Nuclear Agency on breeding and planting of stevia, used as a sweetener.
Agronomic visits and reporting
  • Agronomists’ main task is to ensure estates apply the GAP to optimise palm yield. Despite the MCO, 69 Official Agronomy Reports have been produced on top of ad-hoc special and casual visits.



The primary objective of our Plant Breeding Laboratory is to produce elite planting materials to enhance our oil yields.

Key Initiatives and Achievements

Key Initiatives Achievements
To certify clonal palms for ortet (parental material for clonals) candidates
  • Clone P325, produced in collaboration with MPOB, was officially recognised as an elite clone (Planting Material of Choice) during MPOB Technology Transfer in July 2020. Based on seven consecutive years of FFB data collection, Clone P325 is able to produce an average of 30 tonnes of FFB per hectare a year with achievable mill OER of 28.1% and estimated. CPO of 8.5 tonnes per hectare a year.
  • Clone P325, commercially known as Clonal Palm Series (CPS3) – Productivity for Sustainability won the Malaysian Innovative Product Gold Award 2020 during The International Invention, Innovation and Technology Exhibition (“ITEX”) held on 20-21 November 2020 in Kuala Lumpur
To select and supply elite ortets
  • A total of 36 SIRIM-certified ortets of different genetic backgrounds were selected and provided for Kulim TopPlant in order to produce elite commercial clonal planting materials.
To select and certify new mother palms
  • Another 90 palms were selected from REM seed garden making a total of 283 certified mother palms available for seed production.
Enhance crop security
  • Coconut Seed Garden was established at Tereh Utara Estate in 2019 while attentive field maintenance of immature parental palms was successfully carried out in 2020.
  • Coconut Genebank aimed for specific traits involving various local and international commercial cultivars such as Aromatic Pandan, Tacunan, Indian Deejay Hybrid, Cameroon and Malayan Dwarfs mother palms (Yellow, Red, Green, Brown) besides Tagnanan and Nias green (father palms) was successfully established surrounding KAC for diversification and
  • future commercial utilisation.



UTCL conducts chemical and physical tests on fertiliser samples. It also provides effluent testing for palm oil mills. An ISO accredited lab since 2005, equipped with the latest inductive coupled plasma-optical emissions spectrophotometer (“ICP-OES”), Atomic Absorption Spectrophotometer (“AAS”), UV spectrophotometer and nitrogen auto analyser, it seeks to become the preferred laboratory for the wider agricultural community.

Key Initiatives and Achievements

Key Initiatives Achievements
Complete analyses within stipulated target
  • Conducted a total of 122,446 analyses, of which 93.80% were completed on time; 9.31% higher than in 2019.
  • Despite MCO, a total of 22,300 samples were analysed in 2020, 6% more than in 2019.
Ensure renewal of the accreditation
  • Successfully migrated from ISO/IEC 17025:2005 to ISO/IEC 17025:2017.
  • Received IKM Laboratory Excellent Award from Institut Kimia Malaysia (“IKM”).
Ensure chemists are IKM registered
  • Another chemist obtained her IKM license, thus the lab currently has two IKM-registered chemists.
Provide competent person for CePSWaM
  • One chemist completed the course on Certified Environmental Professional in Scheduled Waste Management (“CePSWaM”), as per DoE requirements for the KAC Complex.



Tissue culture is the best way to mass produce elite planting materials. Research in this area is conducted by Kulim TopPlant which seeks to continuously improve the Group’s oil palm planting materials. Outcomes of its research will help Kulim to achieve higher OER, as fields with clonal materials have proven to produce outstanding yields.

Key Initiatives and Achievements

Key Initiatives Achievements
Produce high-yielding tissue culture ramets
  • A total of 40,000 ramets were produced in 2020.
  • Processed 36 SIRIM-certified ortets and produced 124,296 explants.
  • Produced 22,197 callus and 18,341 Embryogenic callus.
  • Produced 165,199 embryoids and 69,352 shoots
Introduction of mini chamber in nursery
  • Improved the ramet recovery rate at hardening stage by 21%.




Our subsidiary, Kulim Pineapple Farm (“KPF”), cultivates a total of 359 ha of MD2 pineapple farms in Ulu Tiram and Mersing, Johor. Downsteam OEM products, under the Melita brand, are certified HALAL by the Department of Islamic Development Malaysia (“JAKIM”). Melita pineapple is currently sold at five kiosks in Johor: at the Ulu Tiram Estate, Galleria @ Kota Raya, KPJ Johor Specialist Hospital, Larkin Central and KPJ Puteri Specialist Hospital.

KPF has obtained Malaysia Good Agricultural Practice (“myGAP”) 2010-2020, Malaysia’s Best and Sijil Pengesahan Bahan Tanaman (“SPBT”) certifications. It is also one of three companies in Malaysia to have obtained approval from the General Administration of Quality Supervision, Inspection and Quarantine of the People’s Republic of China (“AQSIQ”) to export fresh pineapples to the Republic of China.

KPF plans to expand our pineapple hectarage to 623 ha by 2025, thereby increase production from 2,316 tonnes currently to 13,530 tonnes through collaborations with state agencies and third parties.

Operational Performance

  • Production increased by 19% from 1,954 tonnes in 2019 to 2,316 tonnes.
  • Total hectarage reduced from 418 ha in 2019 as 59 ha was returned to Selai Estate.

Key Initiatives

KPF is collaborating with the Malaysian Pineapple Industry Board (“MPIB”) on an Agropreneur B40 programme under which 65 ha of land has been leased to KPF and 49 ha to 12 agropreneurs for pineapple cultivation. We also contribute towards the state’s agricultural sector by providing technical advice to the agropreneurs.

Challenges and Mitigating Actions

Challenges Mitigating Actions
Limitation of owned land for expansion programme Collaboration and expansion with MPIB and other interested parties
Expensive planting material
due to shortage of suckers
Purchase outside suckers and
propagate own suckers.
Limited manufacturer resulting in high processing cost of OEM products Collaborate with third-party with better processing cost
Unreliable and inconsistent
supply from third party
Introduce contract farming concept together with technical
advice support



As part of strategic initiatives to diversify our plantation activities to involve other crops, we are embarking on coconut planting which will increase Kulim’s growth potential.

As of 31 December 2020, we had planted 100.20 ha of different coconut varieties, namely Pandan, Deejay Sampoorna, Vietnam Green and Vietnam Brown, at Balau Coconut Farm, Kota Tinggi. Managed by our Siang Estate, the farm spans across 173-250 palms per ha. As the plantation is young, and coconuts is expected to bear fruit from the fifth year onwards. Therefore, no production was recorded in 2020.

Challenges and Mitigating Actions

Challenges Mitigating Actions
• Price fluctuations depending
on supply and demand by ex-farm buyer.
• Cheaper coconuts from Indonesia and Philippines causing oversupply in local
• Highly vulnerable to pests
such as rhinoceros beetles and weevils which are potentially devastating.
Presence of weevils , moreover, is generally only
discovered only when the palm is already beyond redemption
  • Lock nut price by contract sale and purchase with buyer.
  • Engage in Good Agricultural Practices.



Kulim has embarked on a pilot urban farming project to grow local and Japanese varieties of cucumber as well as other crops in Ulu Tiram.

Under the first cycle, in Plot A, we have harvested a total 18,496 kg of cucumbers. The second cycle, in Plot B, produced a total harvested 11,941 kg of cucumbers. In the third cycle, we planted 1,395 bags of cucumber, 160 bags of bitter gourd and 125 bags of Japanese cucumber, which will be harvested from end March to end April 2021. The project is being monitored by Kulim Nursery Sdn Bhd and our R&D Department.



Pure Kedah Kelantan (“KK”), pure Brahman and Brahman-KK cross cattle are used in our plantations as a natural means of managing weed. We chose these breeds because they are hardy and live well under plantation conditions. In addition to working our farms, the cattle are a source of income from sales, especially during Eid al-Adha when demand for Qurban cattle is high.

Our aim is to become a significant integrated cattle player in Malaysia with a targeted 10,000 heads of cattle grazing freely in our estates within the next five years.

Other than cattle, buffaloes are used in our plantations for infield evacuation of oil palm bunches. The number of buffaloes has been decreasing slowly, however, along with increased mechanisation to increase productivity. We also embarked on goat rearing in 2005 for corporate responsibility contributions.

Moving forward, we will start to commercialise our goats as part of our business

Operational Performance

  • At end 2020, we had 6,115 heads of cattle covering more than 14,000 ha of plantation area. This was 5% more than 5,808 heads at end 2019, due to an increase in calving rate and decrease in mortality.
  • At end 2020, we had 52 heads of buffalo and 216 heads of goat as compared to 59 and 261 in 2019, respectively.
  • Saved RM351,889 from reduced cost of chemical weed-killers, an increase of 6% from RM331,871 in 2019.
  • Earned RM1.99 million in revenue from sales of cattle

Key Initiatives and Achievements

Key Initiatives Achievements

In line with the government’s requirement during MCO that Qurban cattle be slaughtered only at approved slaughter houses, as opposed to mosques/surau, a temporary slaughter house was built at Basir Ismail Estate

We were able to fulfil customer demand for Qurban cattle during Eid al-Adha
Collaboration with Department of Veterinary Service (“DVS”) on enhancing cattle health and productivity rate Screening for diseases and programmes to enhance reproductive health were carried out to ensure optimum calving rate and low mortality.

Challenges and Mitigating Actions

Challenges Mitigating Actions
  • Diseases such as brucellosisand foot and mouth disease have a considerable impact on the breeding performance of livestock
  • Collaboration with DVS on enhancing cattle health and
    productivity rate.
  • Preventive care is taken to prevent the occurrence and
    spread of disease.
  • Disease monitoring, surveillance and control –
    using vaccination – to ensure cattle are healthy.
  • Sound biosecurity practices also prevent the introduction and spread of disease.
  • Increased cost of feeding the cattle

Utilisation of agricultural waste such as pineapple rind, crowns, pulp and cores; and byproducts from oil palm mills such as decanter cakes, as animal feed


The outlook for palm oil looks bright, with prices continuing to be high as supply of competitor edible oils – such as soybean and sunflower oils – remain restricted. However, this depends to a large extent on the development of La Nina and its impact on soybean output in South America. Palm oil supply is expected to increase, especially in the second half of the year, due to favourable rainfall. With the extra supply mopped by implementation of the B20 and B30 mandates in Malaysia and Indonesia, respectively, this would help to keep CPO prices propped up.

We will strengthen our presence across the value chain by leveraging our expertise in the plantation sector as well as exploring new opportunities in agribusiness.