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Why First Resources must not worry over Indonesia's land expansion limit
It currently owns 300,000ha.
According to CIMB, Indonesia’s plans to limit companies’ estate expansion to 100,000ha will not affect First Resources’ growth plans as the group has more than sufficient landbank to underwrite its future growth via new plantings.
Here's more:
It owns 300,000 ha: 158,737 ha planted and 141,263 ha unplanted. It has a planting target of 15,000-20,000 ha of oil palms per year, and aims to expand its planted area to 200,000 ha within five years.
This should raise its CPO production to 1m tonnes each year. When it reaches this milestone, management will take stock and decide whether to expand downstream or upstream via estate expansion.
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