Economics of Higher Planting Density in Oil Palm Plantations

Abstract

The aim of this paper was to study the financial returns from oil palm planted at different densities on mineral and peat soils in Malaysia. The method of analysis to achieve the mentioned objective was by the cost benefit analysis approach. Data for the analysis was obtained from oil palm planting density experiments at MPOB research stations at Hulu Paka in Terengganu and Teluk Intan in Perak. The analysis indicated that maximum income could be obtained from a planting density of 148 palms/ha, contrary to the conventional practice of 136-148 palms/ha. On peat soil, income is still on the increase when the density is at 200 palms/ha. It is recommended that on peat higher than the conventional planting density of 136-148 palms/ha is adopted in order to maximize net present value (NPV).