Astra Agro plans new CPO plants

JAKARTA (JP): Publicly listed plantation company PT Astra Agro Lestari announced on Monday it would begin operating two new crude palm oil (CPO) plants by the end of the first half of this year to process the expected increase in its oil palm production.

The company, a subsidiary of PT Astra International, said in a statement the addition of the two plants would bring its total number of CPO processing plants to 14, with a total capacity of 497 tons of fresh fruit per hour, up from the present 447 tons per hour.

The company said its CPO output jumped 30.8 percent to 61,880 tons in the first quarter of this year compared to 47,301 tons in the same period last year.

An increase in mature plantation acreage was the main reason behind the rise in CPO production, it said.

The company said its mature plantation acreage stood at 127,382 hectares, or 69.4 percent of the company's total planted acreage of 183,482 hectares, a rise from 52.5 percent at the end of last year.

The company, which primarily sells its CPO products locally, also reported its net profit in the first quarter of this year jumped 73 percent to Rp 50.71 billion from Rp 29.3 billion in the same period last year.

The company's net sales shot up 78.2 percent to Rp 226.24 billion during the first quarter of this year, a rise from Rp 126.97 billion in the same period in 1998.

Its operating income stood at Rp 95.08 billion during the period, up 36 percent from Rp 70.14 billion.

The company said the increase in sales was mostly due to the surge in the sales of CPO, the main material for cooking oil. CPO sales made up 94.2 percent of the company's net sales during the first quarter of this year, following an increase in the company's CPO production.

Making up the rest of the company's sales were rubber, tea and cocoa. Sales of these products surged 44.2 percent compared to the first quarter of 1998.

The company said the average selling price of its CPO in the first quarter was Rp 2,410 per kilogram, slightly higher than the Rp 2,375 per kilogram in the same period last year.

A company spokesman was quoted by Dow Jones newswires as saying Astra Agro did not export any crude palm oil in the first quarter because domestic prices were more attractive than overseas prices because of the 40 percent export tax on CPO.

The company earlier planned to export some 40 percent of its CPO products this year, depending on the speed with which the government reduced the export tax.

The government currently imposes export taxes of up to 40 percent on CPO and its by-products in an attempt to force producers to sell their CPO on the local market. The high export taxes were introduced after a massive outflow of CPO exports following the rupiah's sharp drop against the US dollar.

During the first quarter of this year, the company also produced 2,051 tons of rubber, 723 tons of tea and 299 tons of cocoa.

Rubber and cocoa production increased from the same period last year, while tea production dropped by 27.1 percent compared to the first quarter of 1998.

The company exported 164.8 tons of rubber, 125 tons of cocoa and 51.2 tons of tea during the first quarter of this year. (gis)