Wilmar Group, a Singapore-listed CPO producer, plans to pour $300 million in investments in Gresik, a city in East Java to build a flour mill and bio-refinery plant, a senior executive at the Indonesian unit said.
“We are building a flour mill through PT Wilmar Nabati Indonesia, in Gresik,” said MP Tumangor, commissioner of Wilmar Indonesia. “It will be completed in 2013.”
Tumangor said the bio-refinery plant that is being constructed will be used to process crude palm oil into some derivatives.
There are at least 40 derivatives that can be developed, and Wilmar has just produced 20 of them.
Wilmar will only supply up to 30 percent of the CPO needed for the bio-refinery plant and has plans to buy more from other plantation companies, including state-owned enterprises.
Tumangor said Wilmar is hoping to invest $300 million, which is part of the group’s investment plan in Indonesia in the next two to three years.
“Wilmar sees a potential in Indonesia’s natural resources. It [the country] also offers a big market,” Tumangor said in a press release on Sunday.
Tumangor said that the company’s expansion plan reflected the company’s intention not to focus solely on the crude palm oil business.
He said Wilmar has put a total of Rp 33 trillion ($3.6 billion) worth of investments in Indonesia since 1991, when it began its agro-business in the country.
According to the group’s statistics, Wilmar booked $37.8 billion in sales from Indonesia for the period 2007-2011.
As much as 63 percent of its products was sold overseas and 37 percent was for the local market.
Apart from Indonesia, Wilmar also owns the CPO plantation operation in Malaysia, and sugar mills in Australia
Reuters reported on Feb. 22 that Wilmar International Ltd., booked a 57 percent increase in net income for fourth quarter 2011 from the same period a year earlier, thanks to a big revaluation gain in its core palm oil business and from its enlarged sugar operations.