BPLANT (5254) BOUSTEAD PLANTATIONS BHD' RP25 plan

BPLANT (5254) BOUSTEAD PLANTATIONS BHD' RP25 plan

Boustead Plantations Bhd (BPB) aims to cover about 7.0 per cent of its total oil palm plantation area of 73,453ha with an accelerated replanting programme annually over the next 25 years. KHIS/LUQMAN HAKIM ZUBIR

KUALA LUMPUR: Boustead Plantations Bhd (BPB) aims to cover about 7.0 per cent of its total oil palm plantation area of 73,453ha with an accelerated replanting programme annually over the next 25 years.

Chief executive officer Zainal Abidin Shariff said the ongoing initiative - 25 Year Replanting Programme (RP25) - would require an allocation of RM90 million in capital expenditure per annum for replanting activities, covering a minimum of 4,000ha annually.

"We expect to see positive growth in the next three to five years in terms of crop production and yields, as replanting activities are being carried out progressively," he told the New Straits Times.

RP25 is part of the company's journey in reinventing Boustead Plantations to rebalance its assets' portfolio.

Zainal said about 45 per cent or 33,300ha of the company's total plantation comprised mature or past prime oil palm trees aged above 20 years and required replanting programme.

Meanwhile, BPB's prime oil palms aged between 10 and 20 years old accounted for 27 per cent, and the remaining 28 per cent were below 10 years old.

"45 per cent of our oil palm trees are categorised as past prime and old (age profile), impacting our average yield.

"The strategy is to correct the bell curve of the age profile, thus enabling us to achieve more sustainable production going forward," he said.

As of December 31, 2020, BPB's average yield per hectare was 18.6 tonnes for its Peninsular Malaysia estates.

Zainal said RP25 sets out an extensive 25-year blueprint, defining short and long-term targets to optimise BPB oil palm age profile, with a completion target by 2045.

"The result will be an adjusted bell curve that has a balanced age profile, which will subsequently contribute towards the sustainable growth of the company," he said.

Zainal said BPB had also ramped up its mechanisation effort in line with its transformation aspiration to become a sustainable technology-based plantation company.

"The RP25 blueprint includes a three-year mechanisation plan focusing on harvesting operations, in-field crop evacuation and external crop transportation.

"Improvement to in-field infrastructure is essential for successful mechanisation implementation, as well as enabling more efficient management for the overall replanting process," he said.

Zainal said BPB had accelerated its efforts to mechanise across its operations while reaping good progress in areas such as in-field crop evacuation, external crop transporting, in-field infrastructure, mature weeding, manuring, pest management and at an effluent treatment plant.

Meanwhile, he said BPB had already embarked on the Plantation Performance Improvement Programme (PPIP) since 2019 to increase productivity and enhance cost optimisation.

"The PPIP is currently in its third phase, with a current focus on maximising yield per hectare, efficient mill utilisation, effective production cost and rebalancing our assets portfolio.

"PPIP works in tandem with the strategy in realising the group's commitment to maximise the value of existing assets, improve returns from these assets and generate new sources of income."

Additionally, BPB can explore and engage in new opportunities through direct investment or collaboration with various parties.

https://www.nst.com.my/business/2021/11/747510/boustead-plantations-rp25-plan