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Astra Agro Lestari predicts lower output in El Niño aftermath
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Fresh picks: Newly-harvested oil palm fruit bunches are stored in containers before being processed into palm oil. (sampoernastrategic.com/exlusive)
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span class="im">Publicly listed plantation firm PT Astra Agro Lestari, a subsidiary of diversified conglomerate Astra Internasional, expects to see lower palm oil production this year compared to that in 2015 as a result of the El Niño weather phenomenon.
Although El Niño concluded in the second quarter, Astra Agro Lestari investor relations head Rudy Limardjo said its impact would last up to 20 months. During the first nine months of 2016, the company's production output decreased 18.5 percent to 1.04 million tons compared to the same period last year.
"El Niño has become the La Niña [weather phenomenon], but it will not immediately improve the productivity of plants due to extreme wet conditions in fields," Rudi told The Jakarta Post on Friday.
The company, however, said low productivity had been compensated by higher crude palm oil (CPO) prices, which had increased 6.7 percent year-on-year (yoy) to US$683 per ton in September. This, Rudi said, had helped cushion the decrease in revenue, which had dropped 7.4 percent yoy to Rp 9.59 trillion (US$719.17 million).
"In the bottom-line, our year-to-date net profit increased to Rp 1.15 trillion, thanks to a more stable currency at the level of Rp 13,000 per US dollar," Rudi said.
He added that most of Astra Agro Lestari's debts were foreign currency denominated. (hwa)
