Anglo-Eastern Plantations PLC, a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, has released its trading update for the first quarter ended 31 March 2024. The company's own production of fresh fruit bunches (FFB) decreased by 5% compared to the same period in 2023, mainly due to lower production trends in most regions, except for Bangka and Kalimantan. Rainfall irregularities and replanting activities also contributed to the lower production.
Additionally, FFB bought-in was lower, resulting in a 7% decrease in crude palm oil (CPO) production. The CPO price ex-Rotterdam averaged $1,004/mt, a 1% decrease from the corresponding quarter in 2023. Despite tight palm oil supply, the CPO price was somewhat lower than last year due to the abundance of soft-oil and fragile demand.
The company's balance sheet remains strong with no outstanding bank loans, but there was a significant reduction in cash due to the consolidation of AEP's holding in Indonesian subsidiaries and investments for better yield. AEP's plantations across Indonesia and Malaysia amount to approximately 90,500 hectares, with new planting lower at 66 hectares for the first three months of 2024.
The HPP Mill has commenced operation and is expected to start purchasing external crops once the effluent treatment plant is fully commissioned. The earthworks design for the eighth mill in the KAP estate in Kalimantan has been completed, with the building permit pending evaluation by the Environmental department.
Looking ahead, the CPO price ex-Rotterdam is expected to remain weak, especially against the backdrop of a seasonal increase in soybean production in South America. For further information, contact Anglo-Eastern Plantations Plc.