Printer Friendly

Asian Agri Group.

Backgrounds

The Asian Agri Group (GAA) is a sub group of the Raja Garuda Mas (RGM RGM Restaurant General Manager
RGM Robby Gordon Motorsports (NASCAR team)
RGM Regional General Manager
RGM Robert George Meek (British music producer)
RGM Radar Guided Missile
) Group owned by tycoon Sukanto Tanoto. Tanoto is one of the country's richest people in 2006 according to the Forbes Magazine. According to the magazine, the Tanoto family has assets valued at US$ 2.8 billion (around Rp 25.5 trillion). RGM International has assets valued at US$ 8 billion (around Rp 72.5 trillion).

The GAA has subsidiaries operating in the agribusiness and plantation sectors. It is the second largest a sub-group of the RGM group, which also has APRIL April: see month.  and PEC Tech sub groups.

The GAA with holding company PT Asian Agri has units in the agribusiness and plantation sectors. It also has 200,000 hectares of oil palm plantations, rubber plantations, and cacao plantations in Indonesia, the Philippines, Malaysia, and Thailand. Asian Agri is one of the largest producers of crude palm oil (CPO (Chief Privacy Officer) An individual who manages the privacy issues within an organization. Arising out of the privacy regulations in finance and health care in the late 1990s, the CPO position eventually crossed over to all industries. ) in Asia. The company has 19 CPO processing factories and three cooking oil factories.

APRIL (Asia Pacific Resources International Holdings Limited) operates in Riau, Indonesia and Shandong, China. APRIL is one of the largest producers of paper pulp in the world. Its Indonesia unit produces 2.4 tons of pulp a year and the one in Shandong 1.5 tons per year. Its paper product of PaperONE TM is sold in 51 countries. Another main brand of the company's paper is PaperOne. Indorayon, which once faced strong protest from local people over allegation that it has caused environmental damage in Porsea, North Sumatra, is one of pulp producing subsidiaries of APRIL.

PEC-Tech has business units in the logistics and service sectors. It is a supplier of technologies serving companies operating in paper pulp, palm oil, rayon, oil and gas and energy sectors. It offers services from designs to logistics. It operates in Indonesia, China, and Brazil. The producer of viscose vis·cose  
n.
1. A thick, golden-brown viscous solution of cellulose xanthate, used in the manufacture of rayon and cellophane.

2. Viscose rayon.

adj.
1. Viscous.

2.
 fiber and dissolving pulp is based in Shanghai, China. Its factory has an annual capacity to produce 115,000 tons of dissolving pulp and 60,000 tons of viscose fiber. The capacity is being expanded to 365,000 tons dissolving pulp and 120,000 tons of viscose fiber. Pacific Oil & Gas operates in China and Indonesia carrying out oil and gas explorations and production in the Jambi-Merang and Kisaran blocks. The group also is building a liquefied natural gas liquefied natural gas: see under natural gas.
Liquefied natural gas (LNG)

A product of natural gas which consists primarily of methane. Its properties are those of liquid methane, slightly modified by minor constituents.
 (LNG LNG (liquefied natural gas): see under natural gas. ) factory.

Oil palm subsidiaries of GAA operate in areas in Sumatra including North Sumatra, Riau and Jambi. Currently plantations controlled by the Asian Agri Group total 100,000 hectares with plasma farms of 60,000 hectares. In 1979, it has only 10,414 hectares of oil palm plantations with two CPO factories. Later in 1986, it acquired 2,319 hectares of the plantation of PT Saudara Sejati Luhur.

GAA Plantation I is located in North Sumatra totaling 44,021 hectares or 20% of the total area of 242,685 hectares of private oil palm plantations in North Sumatra in 2001.

AAG further expanded its business to Riau and Jambi, increasing its plantations to 65,000 hectares not including 43,000 hectares of plasma farms.

Currently GAA has around 28 oil palm plantations with 19 palm oil processing plants in North Sumatra, Riau and Jambi. The factories combined have a total production capacity of 1 million metric tons of CPO. Its oil palm plantations expanded from 3 million hectares in 2000 to 3.7 million hectares in 2006. During that period, its production of oil palm fruits rose from 5.1 million tons to10.9 million tons a year.

GAA also operates two rubber processing plants and a cacao fermentation factory. In order to control the quality of its oil palm seeds, GAA has opened a seed research center which has received an ISO (1) See ISO speed.

(2) (International Organization for Standardization, Geneva, Switzerland, www.iso.ch) An organization that sets international standards, founded in 1946. The U.S. member body is ANSI.
 9001 certificate. Seed research center which is located in Topaz, Riau with a production target of 7 million shoots. The company sells part of its shoot production to other companies.

GAA is one of the largest producers of CPO in Asia. It ranks among large oil palm plantation companies the Sinar Mas Group Sinar Mas Group is one of the largest comglomerates in Indonesia. It was formed in 1962. It has many subsidiaries including APP.

Sinar Mas Group was founded by Eka Cipta Widjaja. Its main businesses are: Pulp and Paper, Agribusiness, Property and Financial Services.
, Astra Group, Napan (Lonsum), Bakrie & Brothers, etc.

According to plan, PT Asian Agri will launch initial public offering (IPO (Initial Public Offering) The first time a company offers shares of stock to the public. While not a computer term per se, many founders, employees and insiders of computer companies have found this acronym more exciting than any tech term they ever heard. ) this year. The IPO fund is to be used to finance business expansion.

However, amid the global economic slowdown, the company may delay the IPO plan until he end of 2009 or early 2010.

Tax evasion case

In 2007, PT Asian Agri faced a legal case over alleged tax evasion valued at Rp786 billion. The company was charged with a markup of Rp2.62 trillion in cost to reduce tax obligation by Rp786.3 billion that should go to the state.

PT Asian Agri was charged with corruption in the purchases of assets from the Indonesian Banking Rescue Agency (BPPN BPPN Badan Penyehatan Perbankan Nasional ) in 2003. According to the

Corruption Eradication Commission (KPK KPK Key Production Key
KPK Kommunisticheskaya Partiya Kazakhstana (Russian: Communist Party Kazakhstan)
KPK Key Protection Key
), PT Asian Agri purchased its own former assets through fictitious company at cheap price. The Tempo Magazine carried a story on January, 2007 saying the assets acquired by Asian Agri from BPPN were credits valued at Rp9.7 billion for Tuah Sakato village cooperatives owned by oil palm farmers in Muara Bulian, Jambi. The credit was provided by Unibank, which is also owned by Sukanto Tanoto. The guarantor was PT Inti Indosawit Subur, also a subsidiary of Asian Agri. The buyer was PT Asia Nusa Prima, represented by PT Trust Securities. In a letter of Trust Securities to Asia Nusa Prima it was said that the company was located at Teluk Betung 31, Central Jakarta, but the address turned to be the headquarters of three companies of holding companies of Raja Garuda Mas Asian Agri Group (in plantation sector), PEC-Tech (in logistics and service sector), and Pacific Oil & Gas (in energy and mining sectors).

The credit asset was later seized by BPPN after Unibank was suspended by the government in 2001. Through the fifth phase of credit asset sales program, Asia Nusa Prima acquired the asset at a price of Rp1.45 billion or 15% of its nominal price.

CPO main pillar

PT. Asian Agri (PT. AA) as a holding of GAA controls the group's CPO business in North Sumatra, Riau and Jambi since 1979. In 1983, GAA started expansion to Kalimantan.

PT. Inti Indosawit Subur, a subsidiary of GAA, has 49,000 hectares oil palm plantations spread in a number of regencies in Riau and Jambi. The largest part or 35,850 hectares of the plantations are in plasma plantations run by local farmers under the nucleus smallholder Noun 1. smallholder - a person owning or renting a smallholding
Britain, Great Britain, U.K., UK, United Kingdom, United Kingdom of Great Britain and Northern Ireland - a monarchy in northwestern Europe occupying most of the British Isles; divided into England and
 plantation (PIR "Parent in room." See digispeak. ) scheme. GAA, therefore, has the largest plasma plantations involving migrant farmers under the scheme called PIR-Trans in Riau. The company has oil palm plantations in Riau and Jambi, but the largest part is in Riau.

The PIR scheme of partnership with farmers is used in three areas Ukui, in the regency of Pelalawan, covering the sub-districts of Lubuk Batu Jaya, Inhu in Peranap and Buatan in the regency of Siak. In the Ukui plantation, plasma plantations total 13,520 hectares involving 6,760 farm families. In Buatan and Peranap plasma plantations total 11,000 hectares and 5,262 hectares respectively involving 8,131 farm families. The number of plasma farmers under the PIR-Trans of Asian Agri total 14,891 people each representing a family. Including workers the number is 21,000 people.

GAA has also expanded operation to Lampung. Oil palm plantations controlled by Asian Agri in Lampung are located in the regency of Tulang Bawang. The prices of plantations vary. One ready for harvest is priced at Rp 100 million per hectare, and one not yet cultivated is priced at Rp 15 million to Rp50 million per hectare. The productive age of oil palm trees is up to 35 years. Harvest could take place every two weeks. A hectare could produce up to 10 tons of fruits in one harvest. The price of oil palm fruits is Rp600 per kilogram at the plantations and Rp725 per kilogram at factories.

Based on data at the regional office of the agriculture ministry of Lampung, that province has 300,000 hectares of oil palm plantations located in a number of districts. The plantations have expanded form year to year. Many farmers have converted their lands previously grown with second crops and cassava cassava (kəsä`və) or manioc (măn`ēŏk), name for many species of the genus Manihot of the family Euphorbiaceae (spurge family).  in oil palm plantations. The soil in the regency of Tulang Bawang, in Lampung, is suitable for oil palm plantations and the location is strategic being close to seaports.

In 2007, GAA produced 1 million tons of CPO, up 200,000 tons from the previous year. Currently PT Asian Agri has 100,000 hectares of oil palm plantations and 60,000 hectares or 37.5% are plasma plantations.

Until June 2008, GAA spent Rp1.5 billion on partnership program with local farmers. In 2007 it already spent Rp2.2 billion for the same purpose.

The funds were provided is aid to farmers in Sumatra to develop cattle farms and to produce compost fertilizer and biogas. Development of cattle farm and production of biogas will provide extra income for farmers in the event of a setback in the core business.

Earlier Asian Agri already fostered cooperation with the Indonesian Palm Oil Council (DMSI DMSI Document Management Solutions, Inc.
DMSI Direct Marketing Services, Inc (Chicago, IL)
DMSI Defense Modeling and Simulation Initiative
DMSI Demethoxysecoisolariciresinol
) to train oil palm farmers in modern farming. The training is expected to turn out modern farmers that deserve international certificate of SPO SPO System(s) Program Office
SPO System(s) Project Office
Spo Schizosaccharomyces Pombe
SPO Srpski Pokret Obnove
 (Sustainable Palm Oil). With the certificate, palm oil produced from the plasma plantations would be competitive in export markets such as the United States, Australia and Japan.

GAA through its subsidiary PT Inti Indosawit Subur (IIS (Internet Information Services) Microsoft's Web server. IIS runs under the server versions of Windows, adding HTTP server capability to the Windows operating system. ) has become a member of the Roundtable on Sustainable Palm Oil (RSPO RSPO Roundtable on Sustainable Palm Oil (Kuala Lumpur, Malaysia)
RSPO Remedial Site Project Officer
) since February, 2006.

GAA has built Palm Kernel Oil (PKO PKO Polska Kasa Opieki (Polish bank)
PKO Peace Keeping Operations
PKO Palm Kernel Oil
PKO Pirate King Online
PKO Public Key Organization
PKO Public Key Security Object
) factory in Dumai, Riau with an investment of US$ 7 million. The factory has a processing capacity of 600 tons of palm kernel a day. Part of the PKO production is exported. The factory started operation last year.

Previously, before the factory was built, the company sold its palm kernel in the market. It nucleus plantations (not including plasma plantations) have only an annual production of around 2 million tons and plasma plantations 1 million tons a year or a total of 3 million tons a year.

From the 3 million tons of fresh fruit bunches from the nucleus and plasma plantations the company produces up to 500,000 tons of CPO a year. The company exports 60% of its CPO production and disposes of the rest on the domestic market.

GAA through its subsidiary PT Gunung Melayu Group Estate also processes oil palm waste into compost.

GAA has applied the ISO 14001:2004 Environmental Management System and has received an ISO 9001:2000 certificate for Quality Management System.

Another subsidiary of GAA, PT Gunung Melayu (PT. GM) Group Estate, operates 12,738 hectares of oil palm plantation in Asahan, North Sumatra. This company also has facility to process oil palm waste to produce compost fertilizer since 2004.

Compost is produced from the bunches without fruits cut into small pieces and the pieces are spread in open space for six weeks. Previously the bunch waste was burned, now the waste has been made useful as fertilizer for the oil palm trees.

The company, however, still uses inorganic fertilizers, but it has reduced its dependence on supply of inorganic fertilizers from the market. In 2006, the company produced 20,000 tons of organic fertilizer (compost). In 2007, the production rose to 54,000 tons.

As part of the implementation of its corporate social responsibility (CSR (1) (Customer Service Representative) A person who handles a customer's request regarding a bill, account changes or service or merchandise ordered. Agents in call centers are known as CSRs. See call center. ) its subsidiaries PT GM and PT Saudara Sejati Luhur have scattered 10,000 fish fries including those of gurami, nila, patin pat·in  
n.
Variant of paten.
, catfish in the Asahan river.

Oil palm shoot industry

A subsidiary of GAA, PT.Tunggal Yunus Estate (TYE)--and Oil Palm Research Station is a producer of oil palm shoots with a production capacity of 25 million units per year. TYE which is located in Riau, is one of 8 producers of oil palm shoots licensed by the government.

TYE came on line in 1992 operating and Oil Palm Research Station (OPRS OPRS Office for the Protection of Research Subjects
OPRS Online Prescription Refills (Kaiser Permanente) 
) producing oil palm shoots in Topaz-Riau with selection and crossbreeding of parent trees in Costa Rica. The parent trees imported from Costa Rica are planted at Topaz in 1995 including more than 23,000 trees of Dura Deli, and more than 2,000 trees of pisifera of 36 progenies of TxP and 36 cloned pisifera.

After long research, high yield variety of oil palm trees of DxP Topaz has been licensed to go to the market based a decision of the agriculture minister No.57,58,59,dan 60/KPTS/SR,120/I/2004 in January, 2004.

In the process of selecting shoots, TYE uses 228 selected shoots of Dura Deli (DxD) parent line from reputable research centers such as Mardi Serdang (Malaysia), OPRS Banting (Malaysia), OPRS Dami (Papua New Guinea Papua New Guinea (păp`ə, –y ), Stasiun Riset Chemara (Malaysia), Socfin Johor Labis (Malaysia), and San Alejo (Honduras), 50 selected shoots of pisifera line from AVROS H&C (Malaysia), AVROS Dami (PNG), Ghana & Nigeria (Kade-Ghana), Ekona, La Me and Yangambi.

The OPRS of Topaz has studied 440 progenies of DxP resulted from crossbreeding between 223 Dura Deli and 50 pisifera progenies in 3 locations with different types of gorund--organic/alluvial, hollow peat and deep peat soils over 600 hectares in North Sumatra and Riau consisting of organic/alluvial soil making up 25% and peat land 75%.

Apart from being more adaptable to peat land, palm trees from the shoots of DxP Topaz have high oil content and produce high quantity of fresh fruit bunches, with first harvest to take place after 29 months, high oil content, more tolerable to dry season and resistant to Fusarium Wilt disease.

A test of the DxP Topaz variety at peat land in Topaz-Riau showed that shoots grown in May, 2003 in 2006/2007 turned out 27.6 tons of fresh fruit bunches per hectare a year on the average.

In a bid to increase productivity, OPRS Topaz continues the breeding program using the biotechnology and starts cloning selected trees and multiply plants through cell culture techniques.

In 2004, its shoot production totaled around 2.5 million units. The production continued to scale up to reach 12 million shoots in 2008.

In 2009, TYE plans to increase the shoot production capacity with target set at 20 million units for which TYE will increase the number of activated parent trees by 1,002 bringing the number of its activated parent trees to 2,502. In 2004, TYE had 23,000 parent trees and 1,500 of which were already activated producing 12,000,000 shoots.

TYE also plans to expand its processing capacity this year from 1,000,000 shoots a month to 1,500,000 per month or 18,000,000 shoots a year.

Previously, TYE produced high yield varieties only for its own plantations under PT Inti Indosawit Subur, but starting 2005, it began to operate commercially selling part of its shoots in the market including in export market. Oil palm seeds produced by TYE have also attracted buyers in Malaysia after earlier Malaysia stopped importing seeds from Indonesia as a result of rampant production of false products in the country. TYE has received order for 600,000 shoots from large plantation companies in Malaysia.

Members of Asian Agri Group

1. PT. Asian Agri (CPO Industry)

2. PT. Inti Indosawit Subur (CPO Industry)

3. PT. Gunung Melayu (Palm Oil Plantation)

4. PT. Saudar Sejati Luhur (CPO Industry)

5. PT. Tunggal Yunus Estate (Palm Oil Seed Industry)

6. Etc.
COPYRIGHT 2009 P.T. Data Consult, Inc.
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 2009 Gale, Cengage Learning. All rights reserved.

 Reader Opinion

Title:

Comment:



 

Article Details
Printer friendly Cite/link Email Feedback
Title Annotation:COMPANY PROFILE
Publication:Indonesian Commercial Newsletter
Geographic Code:9INDO
Date:Apr 1, 2009
Words:2587
Previous Article:Development of food crop seed industry.
Next Article:Revitalization of cacao plantations boosts seeds producing industry.
Topics:

Terms of use | Copyright © 2014 Farlex, Inc. | Feedback | For webmasters