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From Oil Palm to Agribusiness and more
Once a prominent Oil Palm planter, Tanah Makmur Berhad (TMB) is now currently focusing on the Township Development of Kota Sultan Ahmad Shah in the state capital of Kuantan, Pahang. TMB has taken a strategic shift forward by expanding into agribusiness sector in order to increase its sustainability and value proposition.
TMB has established its footprint in the Palm Oil industry since 1971. All 13 of its plantations in Pahang measuring a total land area of 17,969.06 hectares were recently disposed to Perbadanan Kemajuan Pertanian Pahang (PKPP). TMB has diversified its businesses from an upstream plantation player into downstream operator via its Sri Jelutong Palm Oil Mill Sdn Bhd (processing capacity of 45MT of FFB per hour). Furthermore, TMB built a 1.5MW biogas power plant that generates ‘green energy’ electrical power derived from Palm Oil Mill Effluent (POME). Hence TMB has signed a 16-year power purchase agreement with Tenaga National Berhad to buy the electricity produced.
At the core of its strength, TMB is also one of the biggest property development players in the East Coast of Malaysia through its property arm, KotaSAS Sdn Bhd. In an effort to unlock the value of our assets, KotaSAS Sdn Bhd has converted TMB’s 1,500 acres of plantation land, which has now expanded to over 2,100 acres, into the biggest township development in Kuantan, widely known today as Kota Sultan Ahmad Shah (KotaSAS). The township project aims to provide 8,000 residential units or homes to approximately 40,000 people. Today, KotaSAS is in the midst of completing a new state administration centre, known as Pusat Pentadbiran Sultan Ahmad Shah (PPSAS) and KotaSAS Sentral ECRL Station with target completion by 2022 and 2026 respectively.
Entering Agribusiness Sector
Our Venture Into Durian & Pineapple
a. Strong Macro & Microeconomic Fundamentals Driven by Demand from China
Our investments into durian and pineapple businesses have been driven by strong macro & micro economic fundamentals of the two crops. For instance, the Malaysian government has been encouraging large-scale farming of durian, counting on a 50% jump in exports by 2030. China pays top dollar for Malaysia’s ‘Musang King’ variety of durian due to its creamy texture and bitter-sweet taste. Prices of the variety have nearly quadrupled in the last five years, resulting in a 15% rise in China’s durian imports last year to nearly 500,000 mt worth $510 million, according to the United Nations’ trade data base.
b. Our Current Investments
Presently, TMB is investing around RM191m to develop 1,500ha of Musang King Durian plantation in Lembah Klau, Raub, Pahang and more than RM60m for 3,000ha hectares of MD2 Pineapple plantation in Rompin, Pahang.
Our aspiration is to grow our durian plantation to 10,000 acres and pineapple to 10,000 acres.
c. Strategic Partnerships
For Pineapple, our 51% subsidiary Rompin Integrated Pineapple Industries Sdn Bhd (“Rompine”) has been commercially developing, operating, and managing a designated pineapple plantation in Rompin Pahang under the East Coast Economic Region Development Council (ECERDC) project. Rompine also owns an internal cultivation centre of pineapple seedlings producing up to 6 million per month. For sales & marketing of pineapple, we have established distribution channels for our pineapple products in major importing countries namely Japan, Korea, Middle Eastern Countries, European Countries, and China. We are also proud to achieve local presence in premium hypermarkets such as AEON, Jaya Grocer, Village Grocer, Big Bazaar, MBO, Just Fruits and AirAsia.
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