Sun, 23 Jun 2024



Sabah set to be top coconut State
Published on: Sunday, March 12, 2023
By: David Thien
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A coconut plantation at Kg Tiga Papan. (Pic: CEphoto, Uwe Aranas)
SABAH, the nation’s top palm oil producer, may also become the top coconut producing State with a range of coconut-based products from coconut water to coconut cooking cream found in supermarket shelves nationally and abroad. 

The vision is of Chief Minister Datuk Seri Hajiji Noor’s who sees coconut industry revived soon.

The RM400 million investment by Linaco Plantations (Sabah) Sdn Bhd to revive Sabah’s coconut industry is one of Hajiji’s Sabah Maju Jaya Development Plan focusing on agriculture, besides industry and tourism.

Hajiji planting a coconut tree while Alex and other officials look on. 

In March 2022, Hajiji launched this Sabah Maju Jaya agricultural project declaring open 5,000 acres in Paitan, Beluran district. The State Government provided 2,000ha for the high-impact project and expects the project to return up to RM1.2 billion annually with the Sabah holding 30 per equity.

On August 30, 2022, Linaco Plantations (Sabah) Sdn Bhd sent its first batch of 24 Sabah trainees from its nearby plantation site at Paitan, Sugut, areas to be trained in its Batu Pahat factory. The 12th Malaysia Plan listed these northern Sabah areas as having poorest districts.

Based in Batu Pahat, Johor, Linaco Manufacturing (M) Sdn Bhd was established in 1992 and is the biggest coconut manufacturer in Malaysia, producing cooking oil, coconut cream, coconut cream powder, coconut milk (santan), coconut sugar granules, coconut water, virgin coconut oil, toasted coconut paste (kerisik), low fat desiccated coconut, and coconut chips.

Dr Roland Chia (Political Secretary to the Chief Minister) with Linaco bosses and the first batch of 24 trainees to be trained in Batu Pahat factory for four years. 

Linaco Plantations (Sabah) Sdn Bhd’s Executive Director Alex Yong, a Sabahan from Kudat, told Daily Express the Linaco Group which owns Linaco Manufacturing (M) Sdn Bhd which is the biggest coconut manufacturer in Malaysia, has been trying for seven years to invest in Sabah.

“In only three months, the Chief Minister made available the land we need to rent to plant fast growing species of coconut to supply to our factory to be sited in Langkon, Kota Marudu, which is a strategic location to collect and process coconuts from Kudat, Paitan, Pitas, Kota Marudu, Kota Belud and other districts,” Yong said.

Yong said coconut carbon is good for activated carbon which is found in pills for gastrointestinal ailments, gas masks, water filters, coal plants atmospheric filters for cleaner air discharge etc, besides charcoal carbon pellets for fuel. The husk can be made into a cushion material.

Some RM200 million will be invested into developing its coconut plantation to be expanded up to 10,000 acres, with another 20,000 acres to be developed with idle landowners and smallholders as Linaco has a working arrangement with AgroBank to help finance these coconut farmers’ enterprises. 

On average, local coconut trees need three years to grow and nuts can be harvested from the fourth year onwards.

Yong recommends that its plantation and others cultivates Mahsuri from India the Tacunan dwarf species which is one of the best dwarf coconut varieties in the Philippines. It is early yielding which may produce flowers in as early as two and a half years and mature nuts by the end of the third year with good agricultural practices. 

It is also high yielding up to 250 nuts compared with 50 for local trees with a lifespan that could reach 45-50 years. He also recommends high yielding hybrid species from dwarf (high yielding) and tall coconut trees (bigger nuts) from India.

Linaco’s 10,000 acres coconut plantation needs at least 1,000 Sabahan workers. RM200 million will be for the setting up of the coconut processing factory to make coconut products that can be exported to 40 countries.

Every month, Linaco would send a batch of Sabahan trainees to its Batu Pahat factory to be upskilled for four years before returning to Sabah with the ability to be supervisors to train other employees. Linaco’s corporate vision is “We want to build a sustainable future for the generations to come.”

The Sabah factory will require 800,000 coconuts to operate optimally. Yong was confident that with supplies from 30,000 acres of coconut plantation, it is doable. 

He said its Pontianak factory PT Kalimantan Kelapa Jaya processes up to 500,000 coconuts while the Batu Pahat factory sources 400,000 coconuts from Sumatra as part of its supply chain.

The coconut industry does not depend on foreign workers. Sabahans earning good wages will keep spending their money in Sabah benefiting the local economy as compared to foreign workers sending part of their wages back to their home countries, said Chief Minister’s representative, Datuk Roland Chia, who officiated at a ceremony in preparation to send off the Sabahan trainees.

Every trainee would earn a minimum wage of RM1,500, with free accommodation, lunch, transportation. Overtime and double pay for working on weekends and public holidays would enable them to earn RM2,000 to RM3,000. The company is expected to provide 2,000 jobs for Sabah’s youths.  

The Sabah Maju Jaya project shows the fulfilment of developing local human resources by the GRS Government in human capital development along with its agriculture prong, as the South Korean copper foil investment factory for the industry prong.

Linaco’s headquarters are located in Shah Alam, with factories based in Batu Pahat, Kalimantan and Shah Alam.  

According to Alex Yong, Linaco’s vision and mission is also to give back to society, and hence, the company dedicates 10 per cent of its profits annually to its Corporate Social Responsibility (CSR) initiative especially aimed at assisting underserved children and families since 2014.

Linaco’s ESG includes zero wastage from their single crop coconut business model from:
  • Harvesting of coconut water
  • Coconut shell as alternative source of fuel in the boiler to generate steam
  • Coconut shell as coconut carbon for activated carbon
  • Testa for crude oil processing and to produce copra expeller cake
  • Kernel into coconut milk and powder
  • Residue into low fat desiccated coconut

Having established “The Bountiful Eye Foundation” (TBEF) in October 2019, TBEF aims to empower existing non-profit organisations – focusing on food aid, education and healthcare for Malaysian children below 12 years of age.

TBEF launched its “Box” project in 2020 with Way Box (Food Aid – Essential Food Supplies), Truth Box (Education – Stationery, School Uniforms etc) and Life Box (Health Care – Hygiene Products such as body wash from head to toe, toothpaste, toothbrushes, sanitisers and so on.)


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