KUALA LUMPUR: Malaysia’s production and exports of palm oil are expected to rise 30% by the end of this year, amid increased demand after neighbouring Indonesia banned exports and following the re-entry of plantation workers from abroad, a minister said.

Malaysia, the world’s second-largest palm oil producer after Indonesia, stands to benefit from a global edible oil shortage exacerbated by Jakarta’s export ban last month, but has struggled with a prolonged labour crunch after coronavirus border curbs halted the entry of migrant workers for its plantations.

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In September, authorities approved the recruitment of 32,000 migrant workers for palm oil plantations and some are expected to arrive this month and in June under a special government quota, Minister for Plantation Industries and Commodities Zuraida Kamaruddin said in a statement.

She did not say how many workers were expected to be brought in.

“With the workers coming back, production levels will rise and Malaysia is on track to meet global demand,” she said. Zuraida said Malaysian growers and producers should “reap the benefit of the void” left by Indonesia, adding that a sharp price correction could take place in July when the export ban is expected to be lifted.

Malaysia has previously said it plans to leverage the global edible oil shortage and “political tension in Europe” to regain market share after buyers shunned the commodity over environmental and forced labour concerns.