FGV set to export oil palm seeds to Indonesia, Philippines
Felda Global Ventures Holdings Bhd (FGV) is set to export its oil palm seeds to Indonesia - becoming the first Malaysian company to do so - and to grow further its seed business in the Philippines.
This follows the signing of two definitive agreements on Thursday to appoint exclusive marketing agents for the two markets,
In a filing with the stock exchange, Malaysia’s largest oil palm seeds producer said the MOU inked between its subsidiary Felda Agricultural Services Sdn Bhd (FASSB) and PT Mitra Agro Servindo (PT MAS) in Jakarta last November had expired following the execution of a definitive agreement.
This will lead to an exclusive arrangement with PT MAS to supply and distribute FASSB’s oil palm seeds and products in the republic for three years.
Based on previous reports, FGV expects to export 1 million seeds to Indonesia this year and increase the figure to 5 million seeds by 2020.
Indonesia is the biggest base of operation for FGV overseas. It has over 5,000ha of oil palm estates and more than 22,000ha of landbank there (excluding joint ventures).
FGV, which has a production capacity of 30 million seeds per year, controls over 40% of the local oil palm seeds market. However, it needs to expand its market abroad due to the stagnating demand in Malaysia.
The company has already exported its seeds to the Philippines, Thailand and Africa. However, these exports accounted for only about 2% of all the seeds produced by FGV annually.
In a separate filing with Bursa Malaysia, FGV said FASSB had also sealed a definitive agreement to appoint Bali Oil Palm Produce Corp (BOPPC) as the exclusive agent to market and promote its oil palm seeds in the Philippines for the period of five years.
The memorandum of collaboration with BOPPC, signed back in May 2015, was extended for 12 months in August last year.
FGV did not give any projection on how many seeds are expected to be sold in the Philippines.