Godrej plans to increase India palm oil efforts

10 October 2006 08:45  [Source: ICIS news]

SINGAPORE (ICIS news)--Godrej planned to boost its palm oil plantations business in India, and intends to form a joint venture with Malaysia’s IJM Plantations for this purpose, a top executive with the Indian conglomerate’s agri-business unit said on Tuesday.

The company signed a memorandum of understanding with IJM last month to explore the possibility of a joint venture, CK Vaidya, managing director of Godrej Agrovet, told ICIS news.

Palm oil is a major feedstock for fatty alcohols, a market in which Godrej has more than 60% share in India.

“Our efforts may be termed backward integration, as we could use the palm oil as feedstock for our own oleochemicals production, which in turn, feeds into our personal care products. It could also be looked at as a hedge against any sudden spikes in palm oil prices,” Vaidya said.

He said the company has earmarked land in the Indian states of Andhra Pradesh, Gujarat, Orissa, Karnataka, Goa and Mizoram for palm plantations. It now has about 10,000 hectares under oil palm cultivation in Andhra Pradesh, Goa and Karnataka.

It also has plantations of jatropha, a biofuel crop, and it plans to have 100,000 hectares of land to cultivate that crop in the next five to 10 years. “We may go into biodiesel production in the future, if we find that business viable,” he said.

The company has set up palm oil mills in Andhra Pradesh and Goa, with a total capacity of 8,000-8,500 tonnes a year.

By: Shibu Itty Kuttickal
+65 6780 4359

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