Guthrie to up RI palm area

Guthrie to up RI palm area

KUALA LUMPUR (Dow Jones): Malaysia's Kumpulan Guthrie Bhd. (P.KUG) is awaiting approvals from the Indonesian government to increase its oil palm plantations there to 200,000 hectares, the state-funded Bernama news agency reported Thursday.

Kumpulan currently has 11,000 hectares of oil palm plantations in Sumatra and is close to acquiring another 4,000 hectares, the report quoted Chief Executive Officer Abdul Khalid Ibrahim as saying on the sidelines at an annual general meeting of the company.

"Before June next year, we will have some form of arrangement or agreement, and implementation of our plan of investment in Indonesia," Ibrahim was quoted as saying.

Higher land prices and a shortage of labor in Malaysia have forced many plantation companies in Malaysia to look to Indonesia for expansion and relocation.

Ibrahim said the company produced 306,295 metric tons of crude palm oil in 1999, up 9 percent from production in 1998. An even higher output in 2000 will compensate for lower palm oil prices this year, he said.