Cargill plans $750 million expansion in Indonesia

JAKARTA. Global food and agriculture company Cargill has set aside US$750 million to finance its business expansion in Indonesia, particularly in food processing industry.

Bram Klaeijsen, Cargill Asia Pacific Holdings Pte. Ltd. president and regional director for Asia Pacific, said the funds would be spent from the beginning of next year for the next four or five years.

 “We’re planning to build a food [processing] complex. We will make sweeteners, oil and fats and animal food. So it’s all food related and maybe some customers will come to use our products to produce goods for other customers,” Klaeijsen said during an Investment Summit on Thursday.

The food processing complex would be established in the Serang area of Banten. Klaeijsen also said Cargill would try to distribute products manufactured by the new facilities to the domestic market.

 “We will sell as much as we can [in] the domestic [market], but when you build a facility, you build for a certain size and to fill up, you may have to export some,” Klaeijsen said.

Cargill, headquartered in the US state of Minnesota, started its business in Indonesia in 1974 by establishing a feed mill in Bogor, West Java. Following expansive moves, the company’s products now include animal nutrition, cocoa, grain, oil seeds, palm oil and sugar.

According to Klaeijsen, Cargill now has eight animal feed plants in Indonesia.

In palm oil, Cargill operates under PT Hidoli, which is based in South Sumatra, and PT Harapan Sawit Lestari and its subsidiaries, which are based in Kalimantan. Under the two companies, Cargill’s plantations now cover around 41,000 hectares, according to its website. It also has four palm oil mills with a combined capacity of 320 tons per hour.

Last May, Cargill said it had kicked off a $100 million cocoa processing facility project in Gresik, East Java. The plant, which is designed to have the capacity to process 70,000 tons of cocoa beans a year, is expected to be finished in the middle of 2014.

Also, Cargill owns a 98 percent stake in PT Sorini Agro Asia Corporindo, one of the world’s leading producers of Sorbitol.

It has two starch sweetening factories and five starch plants in the country. (Raras Cahyafitri/The Jakarta Post)