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Palm oil production picks up, selling price increases in Q1
A number of agricultural companies have shown positive results in the first quarter of this year, with crude palm oil (CPO) production rebounding strongly during this period, according to published reports
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A number of agricultural companies have shown positive results in the first quarter of this year, with crude palm oil (CPO) production rebounding strongly during this period, according to published reports.
Astra Agro Lestari (AALI), part of diversified conglomerate Astra International, doubled its net profits to Rp 784.6 billion (US$67.84 million) during the first three months of the year, compared to Rp 356.4 billion in the same period last year.
The company's head of investor relations, Rudy Limardjo, attributed the good performance to increasing sales, the average selling price (ASP) and improved production.
AALI's net revenue surged by nearly 37 percent year-on-year (y-o-y) to Rp 3.7 trillion during the period, compared to Rp 2.7 trillion recorded in 2013.
The surge in the firm's revenue was driven by increasing CPO production, which rose by 14.6 percent y-o-y to 403,383 tons between January and March this year, compared to 352,093 tons in the same period last year.
AALI's fresh fruit bunch (FFB) production reached 1.29 million tons during the period, increasing by 6.7 percent compared to 1.21 million tons harvested in the first quarter of 2013.
'Our production began to pick up in the first quarter, and we managed to book higher profits thanks to improvements in our average selling price,' Rudy said.
The company's ASP during the first quarter of this year rose by nearly 40 percent y-o-y to Rp 8,949 per kilograms, from the previous Rp 6,464 in the same period in 2013.
This was an improvement compared to AALI's performance last year, when it posted a decline in its full-year profits of 25 percent to Rp 1.8 trillion, which was primarily due to currency depreciation, falling commodity prices and declining FFB production by about 7 percent to 5.12 million tons, due to unfavorable weather conditions.
Another palm plantation firm, Dharma Satya Nusantara (DSNG), also recorded significant growth in its CPO production by about 35 percent y-o-y during the first three months of this year to 88,385 tons, compared to 65,644 tons during the same period last year.
The company's FFB production reached 303,231 tons in January-March, up by 16.7 percent to 303,231 tons from 259,7612 tons during the first three months of 2013.
DSNG also enjoyed a rising ASP, which stood at Rp 8,888 in March, up by nearly 34 percent compared to Rp 6,639 in the same month last year.
As of March, DSNG's total planted area covered around 72,000 hectares, according to the company's quarterly newsletter. The firm's plantations are located in Kalimantan and Papua.
Meanwhile, publicly listed company BW Plantation (BWPT) saw its revenue rise by about 33 percent to Rp 268.86 billion in the first quarter of the year, kontan.co.id reported.
BWPT's corporate secretary, Kelik Irwantono, said the company estimated its net profits during the first three months of the year had doubled from last year's first-quarter figure of Rp 36.17 billion, as it expected to benefit from improving global commodity pieces.
BWPT's CPO production rose by 8.2 percent to 32,670 tons in the first quarter of this year, compared to 30,195 tons in 2013. Its FFB production reached 10.3 percent from 145,744 tons between January and March this year, compared to 145,744 tons during the first quarter of last year.
While booking stronger sales last year, growing by 20.74 percent y-o-y to Rp 1.14 trillion, BWPT saw its net profits fall by 44 percent y-o-y to Rp 181.78 billion last year due to a plunging ASP.
This year, Kelik said the company hoped to see a 25 percent increase in its CPO production.
BWPT currently owns more than 89,000 hectares of land in Central Kalimantan, East Kalimantan and West Kalimantan, of which its total planted area exceeds 62,000 hectares.
The Agriculture Ministry has estimated that this year's CPO production will hit 29 million tons, up by around 7 percent compared to 27 million tons last year, despite the El Niño forecast, which it is projected will hit the country later
this year.
