Plantation issuer, PT Mahkota Group Tbk. (MGRO) will increase the capacity of storage tanks to 98,000 tons this year.
Bisnis.com, JAKARTA - Plantation issuer, PT Mahkota Group Tbk. (MGRO) will increase the capacity of storage tanks to 98,000 tons this year.
MGRO President Director Usli Sarsi revealed that the current capacity of the storage tank is still 78,000 tons. At present, the company is in the process of adding a storage tank of 20,000 tons, with a capital expenditure of Rp20 billion.
"The tank is currently full, because some of us are rented," he said when contacted by Bisnis.com, Tuesday (03/19/2019).
He revealed, the weak CPO price made the plantation companies hesitant to expand. According to him, the negative sentiment that has emerged recently has triggered doubts in expansion, so that the company's stockpile tank is now full.
Another reason that causes the company's full tank to fill is that CPO prices have not improved. Even so, he said, the prospect of CPO would improve for the long term.
Not long ago, CPO prices had broken through 2,200 ringgit per ton and returned down almost to the level of 2,000 ringgit per ton. In Bursa Malaysia, CPO prices at the close of trading on Tuesday (03/19/2018) rose 24 points to the level of 2,129 points.
On the other hand, Usli assessed, the negative sentiments from the European Union were indeed quite influential on the export of CPO products and their derivatives. But with the intervention of the government, he hoped, this problem could be resolved.
Reflecting on the negative sentiments often raised by the European Union, Usli assessed that the government needs to conduct good cooperation between CPO producing countries at the regional level to fight these sentiments at the international level.
Usli added, the company canceled plans to expand to biodiesel this year. This is because MGRO is focusing on preparing the construction of a refinery plant and Kernel Crushing Plant (KCP) to enter the rinsing industry which is being intensified by the government.
The secretary of the Mahkota Group Elvi added, MGRO was making an in-depth study of various aspects related to the diversity of products that could be produced in the flushing industry.
Editor: Riendy Astria