No report on FGV's Indonesian subsidiaries involvement in open burnng

FGV Holdings Bhd has not received any report of its subsidiaries involvement in open burning in Indonesia that has contributed to the haze affecting the region, its group chief executive officer, Haris Fadzilah Hassan said.

"Until we have the data, we are not able to say if (this) thing is happening or not," he told reporters at a partnership deal signing ceremony between FGV’s subsidiary, Delima Oil Products Sdn Bhd (DOP) and DKSH (Malaysia) Sdn Bhd today.

"So far we have not had any report about that, but, of course, being in Indonesia is a bit tricky because we have the (Perkebunan) Inti (Rakyat) and Plasma (Transmigration Programme) and there are also some smallholders around the perimeter of the big plantations,” he said.

Perkebunan Inti Rakyat is a joint-venture scheme between companies and smallholders, while the Plasma Transmigration Programme refers to farmers who are taking part in the programme set up by the Indonesian government.

Earlier, Haris pointed out that FGV runs oil palm plantation joint-venture companies with Lembaga Tabung Haji in Kalimantan Tengah, Kalimantan Utara, Kalimantan Barat, and Pontianak.

On the haze, FGV chief operating officer of the plantation sector and head of palm upstream cluster Syed Mahdhar Syed Hussain said it could affect FGV's oil extraction rate in October.

"The current crude palm oil price is about RM2,100 plus per tonne. If I'm talking about five tonnes of crop (extraction) to get one tonne of oil, it's about 20 percent.

"So, if you look at the percentage, its impact is the percentage ratio of the amount of the fresh fruit bunches (that) I can extract. It may impact 0.2-0.5 percent and it’s a lot of percentage," he told a press conference after the event.

However, this is unlikely to have an impact on FGV's bottom line, Syed Mahdhar said.

DOP acting chief executive officer Shammim Azad Kamruzaman said the partnership with DKSH is set to strengthen the distribution of FGV's downstream products in the hotels/restaurants/cafe sector.

DOP expects the partnership to help double its volume, currently averaged at RM3 million per month, within a year.

A Malaysia-based player in the fast moving consumer goods (FMCG) sector, DOP manufactures and sells leading brands such as Saji, Seri Pelangi and Adela, while DKSH is a leading market expansion services provider for FMCG with focus on Asia.

- Bernama