Inhutani III to enter oil palm sector

Inhutani III to enter oil palm sector

JAKARTA (JP): State timber company PT Inhutani III said
yesterday that it planned to develop 60,000 hectares of oil palm
plantation in its concession areas.

Inhutani III president Soeyoto Wongsoredjo said that the
company was still looking for private partners to enter into
joint ventures to develop the plantations.

"Many private investors have asked to be our partners, but
none have so far met our requirements," Soeyoto said in a news
conference.

He said his company expected any future partners to bring
fresh money into the venture, but declined to state how much of
an investment was required.

Soeyoto said Inhutani III had received approval from the
government to diversify into the plantation sector. It currently
operates only in the forestry sector.

"The Minister of Finance has approved the revision of our
statute so that we can diversify our business into several areas
of the forestry and plantations sectors," he said.

The revised statute stipulates that state timber companies can
use 30 percent of their concession areas for plantations, he
said.

Inhutani III, established in 1974, has concessions covering
300,000 hectares of forest in West and Central Kalimantan,

The company plans to transform 20 percent of its concession
area into oil palm plantations, beginning with a 1,000 hectare
development in Central Kalimantan later this year, according to
Soeyoto.

Next year, he said, the company planned to develop a further
20,000 hectares of oil palm plantations.

Soeyoto said the company expected to continue to underperform
this year because of the sluggish demand for wood on both the
domestic and international markets.

Last year Inhutani III suffered an Rp 12 billion (US$750,000)
loss due to forest fires, he said. (gis)