PULAU CAREY (April 25): Sime Darby Plantation, the plantation arm of conglomerate Sime Darby Bhd, has commenced the first planting of genome-select high-yielding oil palms, which is expected to significantly improve the earnings of the group in the future.

According to Sime Darby president and group chief executive Tan Sri Mohd Bakke Salleh, the new palm will deliver significantly higher oil yields, without needing to increase the hectarage of the group's existing plantations.

"By 2023, we will have enough genome materials to meet all of our replanting requirements. We have a replanting policy of about 5% per annum in Malaysia. We expect the high yield plants to contribute significantly to our bottom line in the future," he said, adding that the planting of the high yield plants will only be done in Malaysia.

Sime Darby Plantation head in charge of research and development (R&D) said the pioneer project will start with the planting of a total of 100 ha, out of which half will be planted in its highest yielding estate in Pulau Carey, while the balance will be planted in another plantation in Malacca in September this year.

"These selected palms produce at least 15% more oil than Sime Darby Plantation's existing Calix 600, its best planting material. Under good growth conditions, the potential yield can exceed 11MT/ha, compared to a yield of 5.3MT/ha by Calix 600," he said.

Meanwhile, the production of fresh fruit bunches will also see an increase of 8% with the improved palms compared to the existing palms.

Going forward, Bakke said the group will continue to invest in R&D to further improve yields of its oil palms, and said Sime Darby annually allocates between 2% and 3% of its turnover for R&D purposes.

Out of the total earmarked for R&D, 10% will be allocated for the genome select project, he added.

At 11.44am, Sime Darby rose 0.25% or 2 sen to RM7.95 with 94,500 shares traded.