The Palm Scribe

Despite Loss, ANJ Records Higher 2018 CPO and FFB Output

Palm oil producer Austindo Nusantara Jaya (ANJ) said that although it posted a loss in revenue in 2018 mostly because of low world prices,  it also posted higher production of Crude Palm Oil (CPO) and Fresh Fruit Bunches (FFBs).

In a press conference after a company public expose on Wednesday (15/5) ANJ President Director Istini T. Siddharta, labeled 2018 as a challenging year for the company but added that a number of other achievements were also reached.”It was a difficult phase for the palm oil industry globally in 2018, but we are able to sharpen the company’s strategy and goals and strengthen the company’s business fundamentals through several measurable efficiency programs,” Istini said.

ANJ recorded a net loss of  $0.5 million, compared to a previous net income of $46.5 million in 2017, due to a combination of lower CPO selling prices in 2018 and certain investment sales profits in 2017.

The company’s consolidated income decreased by 6.2 percent to $151.7 million mainly due to a significant decline in the average CPO price to $504, or down 75 percent compared to 2017.

“For 2019, our focus is to optimize the productivity of our plantations and factories to achieve FFB production and maximum extraction rates,” Istini said. “Other priorities are continuing replanting in Sumatra and Belitung and the completion of palm oil mills in West Papua,” she added.

The total CPO sales volume increased by 17.8 percent to 246,138 tons compared to the previous year. Total CPO production increased by 18.3 percent to 248,694 tons and the total rate of CPO extraction rose two percent to 21.8 percent compared to 2017.

ANJ also managed to record an increase in FFB production of 786,104 tons, up 7.6 percent compared to 2017. PK production in 2018 also grew by 22.7 percent to 54,033 tons.

Istini said ANJ has also implemented energy consumption efficiency by operating energy-efficient multi-stage turbines, increasing the use of biomass as a substitute for diesel fuel and reducing fuel use throughout the plantation.

On Sustainability and Environment 

As a member of the Roundtable on Sustainable Palm Oil (RSPO), ANJ is committed to continuing sustainability programs that seek to balance environmental and development aspects.

“Especially for Papua province, in accordance with the policy set by the government, which is 75 percent allocated for conservation and 25 percent for development, ANJ tries to adjust its business model so that it can provide benefits to the surrounding community,” said Fakri Karim, Director of Sustainability at ANJ.

“With discussions on the issue of deforestation, many have questioned why we entered Papua? That’s because we develop a responsible business based on sustainability,” Istini added.

Inside PT KAL conservation area in Ketapang district, which is a habitat for more than 150 orangutans, ANJ works together with the West Kalimantan Regional Government and NGO partners such as The Nature Conservancy, International Animal Rescue and Tropenbos Indonesia, and developed an ecosystem on 3,844 hectares of land which connected to the Gunung Palung National Park area.

In West Papua, ANJ continues to improve the quality of life of the community through cooperation programs with authorities such as health service quality programs and early childhood education.

Other achievements include the decline of stunting cases, the acquisition of permits for early age learning centers, and the ability of local communities to manage organic vegetable gardens under the guidance of NGO partners.

ANJ is a group of companies whose business activities are focused on agribusiness-based food fields with 10 subsidiaries operating in Sumatra, Java, Kalimantan, and West Papua.

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