Bakrie to build two CPO plants
JAKARTA (JP): Plantation firm PT Bakrie Sumatra Plantation (BSP) said on Tuesday it planned to build two new crude palm oil (CPO) plants in Sumatra worth a total of US$12.3 million in joint ventures with two Singaporean and Malaysian firms.
Company president Ambono Janurianto said the company had signed an agreement with the Singaporean firm to build a $5.3 million CPO plant in Tanjung Jabung Barat, Jambi, while its subsidiary -- PT Agrowiyana -- was negotiating with the Malaysian firm to build a $7 million CPO plant in Kisaran, North Sumatra.
He said the Singaporean and Malaysian firms would provide the funds for the construction of the plants, while BSP and Agrowiyana would provide land.
He refused, however, to identify the Singaporean and Malaysian firms.
"The Jambi plant will have a production capacity of 360,000 tons a year, while the Kisaran plant will have a capacity of about 240,000 tons a year," he told reporters after an annual shareholders general meeting.
Ambono said construction of the Jambi plant was expected to start in July or August this year, while the building of the Kisaran factory was expected to commence in August or September this year.
"We hope to complete the new plants in 18 months (the end of 2002 or the beginning of 2003)," he said.
Today, BSP has only one CPO plant, located in Pasaman, West Sumatra, which belongs to its subsidiary PT Bakri Pasaman Plantation. It also operates a cooking oil refinery in Karawang, West Java owned by PT Kilang Vecolina.
BSP and its subsidiaries Bakrie Pasaman and Agrowiyana, now operate a total of 29,000 hectares of palm oil plantations in Pasaman, Kisaran, Tanjung Jabung Barat.
Aside from palm oil, BSP also operates a 15,500 hectare rubber plantation in Kisaran.
Ambono said BSP was increasing the capacity of its Pasaman plant by 50 percent to 270,000 tons from 180,000 tons a year.
"We have expanded our production to anticipate the growing demand of CPO derivative products in the local and export market in the future," he said.
He said the expansion was aimed to anticipate growing demands in China and India.
Ambono said, at present, the company only supplied CPO and its derivative products for the domestic market as the prices were higher than the export prices, but he did not rule out the possibility of raising exports in the future.
He said CPO and its derivative products accounted for about 45 percent of BSP's total sales last year, while rubber, which was mainly for exports, accounted for the remaining 55 percent.
Company consolidated sales rose 23 percent to Rp 357.9 billion last year from Rp 289.9 billion in 1999, but it suffered a net loss of Rp 194 billion in 2000 as against Rp 6.4 billion a year earlier.
BSP attributed the increase in net loss last year due to a high foreign exchange loss of Rp 224 billion.
The company projected its sales to increase 4 percent to Rp 372 billion this year, while net loss will decline 45 percent to Rp 105 billion.
Ambono said that the projection was based on the estimation that the CPO price would remain stable at current levels of about $210 a ton and the price of rubber would be about 53 U.S. cents a kilogram. (05)