Wilmar International, buying Australia’s biggest sugar refiner, said key Asian markets suffer from deficits of the sweetener and its purchase will help expansion plans in Indonesia.
Wilmar is willing to spend as much money as Sucrogen, acquired for A$1.75 billion ($2.08 billion) from CSR Ltd., needs for its expansion plans, Chief Executive Officer Kuok Khoon Hong told reporters at a conference in Singapore today. Wilmar plans to build 200,000 hectares (494,210 acres) of plantations in Indonesia’s Papua province within 5 years, Kuok said.
Wilmar is willing to spend as much money as Sucrogen, acquired for A$1.75 billion ($2.08 billion) from CSR Ltd., needs for its expansion plans, Chief Executive Officer Kuok Khoon Hong told reporters at a conference in Singapore today. Wilmar plans to build 200,000 hectares (494,210 acres) of plantations in Indonesia’s Papua province within 5 years, Kuok said.
Kuok is taking advantage of Wilmar’s record profit to fund his strategy to diversify earnings at the world’s largest palm oil trader. Sugar demand in Asian markets, including China and India, outstrips annual supply by 30 percent, Wilmar said in a presentation filed today, citing the International Sugar Organization.
Indonesia’s attraction lies in “its deficit in sugar, the large tracts of land available to build sugar plantations,” Kuok said. Prices in the nation are also higher than international rates, he said.
Wilmar rose 1.2% to $5.95 in Singapore trading. Raw sugar has slumped 38% this year on the ICE Futures U.S. in New York. The sweetener reached a 29-year high of 30.4 cents on Feb. 1 after adverse weather reduced production in Brazil and India.
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