Economic analysis on factors affecting oil palm productivity among different categories of smallholders: a case study in FELCRA Berhad Lekir / Muhammad Shafaat Ahmad Nazar

Different management scheme can technically affecting the overall performance of oil palm productivity for a certain organization. Under Federal Land Consolidation and Rehabilitation Authority (FELCRA), there are two different categories of smallholders which are under scheme and exit scheme. Since there is still lack information regarding the economical effectiveness between the two different categories of smallholders, thus this research was done. The objectives of this study were to know comparison in terms of the economic and technical factors that affecting oil palm productivity among different categories of smallholders. Other than that, this study was done to investigate the relationships between factors of productivity (which includes mechanization, labour competencies’, fertilizer and herbicide application) for the two different categories of smallholders. The location of the study at Felcra Berhad Lekir and the data was taken that involved the population of smallholders under and exit scheme. The number of samples taken from the exit scheme is 63 while from under scheme is 38. Data collection methods that have been used were primary and secondary data with the methods of distributing questionnaire, interview and collection data from the office management. Data analyses involved in these studies was descriptive, statistical t-test, benefit cost ratio and correlation. The results from this study showed that smallholders exiting FELCRA schemes have lower oil palm productivity compared with under scheme smallholders. But, overall it can be concluded that exit scheme smallholders were having more economical and cost effectiveness based on the production factors studied. These were due to some of uneconomical charges that have been charged to under scheme smallholders which reduce the income that can be obtained by the smallholders although the productivity was higher. It was recommended to FELCRA management so that it can improve its management system focusing on the production factors and making it is more economical effective to ensure the smallholders stay loyal under the scheme provided.