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F i m a C o r p o r at i o n B e r h a d ( 2 1 1 8 5 - P ) •
A n n u a l R e p o r t 2 0 1 8
plantation division
of the workforce employed to perform
the aforementioned works are carried
out by locals who live in neighbouring
villages and towns. Recruitment of local
will continue to be our priority.
Existing
workers
quarters
have
been refurbished and upgraded to
accommodate up to 50 workers. In the
meantime, the construction of 8 new
quarters that can accommodate a further
64 workers is in progress and will be
completed in this current financial year.
Ladang Sg. Siput, Perak
The permission and approvals for land
development at our greenfield estate
in Sg. Siput, Perak measuring 2,000
hectares have been obtained from
various authorities after much delay.
An environmental impact assessment
exercise is now being carried out by an
independent consultant and is expected
to be completed in this current financial
year.
OUTLOOK
It is pleasing to note that the benefits of
our greenfield acquisitions over recent
years are gradually being realised.
We expect the Division’s positive
revenue momentum to be sustained
on account of the projected upward
trend in FFB production as more areas
in the Group’s greenfield estates attain
maturity. Although in the near term our
earnings will experience some pressure
as a result of the required expenditure
in developing the greenfield estates, we
expect the returns will take hold once the
development and planting programmes
are completed thereby improving
margins.
The International Monetary Fund
predicts global growth to rise from
3.8% in 2017 to 3.9% in 2018-2019;
the fastest pace in 6 years. This will
inevitably lead to a proportional increase
in consumption, particularly for food.
As food consumption rises, so too will
the demand for palm oil. On the other
hand, we expect major challenges on
the supply side due to ongoing industry
labour shortages and the high replanting
activities in Indonesia. In respect of the
former, the Division has put in place the
necessary infrastructure at its greenfield
estates to facilitate mechanisation of
major field operations that are labour
intensive in order to reduce its labour
requirements.
The Board believes that on balance,
this sector will continue to benefit from
the growing demand given that palm
oil is a significant and versatile raw
material for both food and non-food (i.e.
oleochemicals and biofuel) industries
and is confident of its sustainable growth
over the long-term.