HAVING already established a small but significant presence for itself in the palm oil industry in Malaysia, local fertiliser manufacturer Plant Safe Fertilizer Sdn Bhd is already eyeing a bite of the vast Indonesian plantation market. Plant Safe has been manufacturing its own special mix of fertiliser for the local plantation industry since the 1980s and recently firmed up an agreement to set up a production site in Medan, Indonesia. Plant Safe founder Ng Hock Lin said the company has struck up a joint venture with an Indonesian plantation owner with 17,000ha of palm oil plantation land. “We are now in the process of forming a company in Indonesia. Our product is registered under the National Standardisation Agency of Indonesia. Once everything is approved, our product will be available there,” Ng said

Plant Safe’s new venture will start with a production capacity of 50,000 tonnes, which is half its production here. The palm oil industry is one of the key sectors in Malaysia, reportedly contributing about 8% of the country’s gross domestic product or almost RM53bil of the nation’s gross national income. With some five million hectares of land covered by oil palms in Malaysia, Ng said the market for its products in Malaysia by itself is substantial and Plant Safe is merely scratching the surface of the potential here. “The market here is big enough for us to continue growing rapidly. But if we are big enough and have the capacity, certainly we would want to expand into other markets as well,” he added.

Plant Safe manufactures fertiliser in sachets that releases the nutrients to the plants slowly over a period of time, which Ng claims is the first of its kind in the world. The company has patented the sachet concept in Malaysia, Indonesia, China and South Korea and is awaiting approval for its patent in Cambodia, Vietnam and Thailand. The patented sachet controls the delivery rate of nutrients to plants and protects the valuable nutrients from being washed away by rain. Ng started formulating fertiliser mixtures for the palm oil industry in 1982 after many years of blending and producing organic fertiliser for the horticulture sector. Ng’s brew for the palm oil industry is relatively new and is yet to be widely accepted by plantation owners.

Traditionally, fertiliser is routinely spread in plantations using manual labour, which Ng said makes fertilisation uneven and susceptible to being washed away by rain water. He added that about 50% of fertiliser is usually washed off when it rains. “Usually, you need to do about seven to 12 rounds of fertilisation a year in a normal oil palm plantation. But the sachets can reduce the rounds to about twice a year as the nutrients are contained in a sachet and leech out slowly,” he said. This, Ng points out, reduces labour needs in a plantation. As it is, the industry is facing an acute shortage of labour and it is not easy to mechanise operations in a palm oil plantation given the uneven terrain they are located on.

Additionally, the sachets produced by Plant Safe are made of biodegradable material, which reduces the need for them to be collected back for disposal after use. Plant Safe turns in annual revenue of RM150mil and Ng said it is possible to achieve growth of 20% a year. The biggest setback to its growth here is the old-school thinking of plantation owners who are reluctant o invest in new methods. Granted, the price of Plant Safe’s fertiliser is 30% higher, tonne for tonne, compared with traditional granule-form fertilisers, but Ng said in the longer run, operational costs are lowered due to the reduction in fertilisation cycles per year and the cost-savings from reduced labour. The fertiliser mixture in the sachets is customised to the needs of clients and can range from RM800 per tonne to RM2,300 per tonne.

According to Ng, 1ha of plantation land requires about one tonne of fertiliser a year and plantation owners could potentially save up to RM6.3mil on lower operating costs for 100,000ha of land. “We understand that we need to keep costs low for plantation owners, so we are competitively priced as well,” he said. Plant Safe will also be completing a new facility in Bintulu in March which has a capacity of 40,000 tonnes to serve its clients in East Malaysia. While the new facility may be small, Ng said ramping up production is a non-issue as it can double capacity within three months with minimal investment.

Plant Safe’s move into Indonesia presents the company with a big opportunity to grow the business as Ng noted that palm oil plantations cover some 14 million hectares of land in Indonesia, which is three times the size of the local market. But Ng is not just out to reap the benefits of serving the palm oil industry. He believes that the right fertiliser can help boost production and improve yields for the industry.“The profile of nutrients used in most plantations has not changed in the last few decades. But technology has advanced and we can improve industry yields by improving the profile of nutrients.“And this will benefit not just the industry but the country because it will boost our exports and add to our country’s revenue. So plantation owners need to be open to adopting new measures and not be afraid to invest in methods that can work,” Ng said.

Credit from TheStar