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Smart to Expand Palm Oil Plantations
Sunanda Creagh | August 05, 2010

President director of SMART Daud Dharsono speaks in an interview in Jakarta on Thursday. Indonesian palm oil giant PT SMART, accused by green groups of clearing valuable forest, aims to expand its plantations by 50,000 hectares a year, Dharsono said on Thursday. (Reuters Photo/Crack Palinggi) President director of SMART Daud Dharsono speaks in an interview in Jakarta on Thursday. Indonesian palm oil giant PT SMART, accused by green groups of clearing valuable forest, aims to expand its plantations by 50,000 hectares a year, Dharsono said on Thursday. (Reuters Photo/Crack Palinggi)
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Indonesia. Palm oil giant Sinar Mas Agro Resources and Technology, accused by green groups of clearing valuable forest, aims to expand its plantations by 50,000 hectares a year, the company’s president director said on Thursday.

Smart last month rejected fresh claims by Greenpeace that the firm was clearing peatland and high conservation value forests that shelter endangered species and trap vast amounts of greenhouse gases.

Smart runs the Indonesia palm oil operations of its Singapore-listed parent company, Golden Agri-Resources. GAR is controlled by the Widjaja family, whose business empire Sinar Mas has interests in pulp and paper, finance and property.

The bitter dispute between the palm oil industry and environmentalists has broader implications for Indonesia, the world’s biggest palm oil producer.

It wants to expand crude palm oil production and boost economic growth but has also promised to cut greenhouse emissions by as much as 41 percent from business-as-usual levels by 2020 — largely through curbing deforestation.

Smart’s president director, Daud Dharsono, said that the Greenpeace campaign had not affected the firm, which currently has around 430,000 hectares of plantations.

Smart’s shares have risen 32.4 percent this year, beating the overall index which is up about 18 percent.

“Smart will grow and expand its palm oil plantations,” said Dharsono, 54, adding that Smart and GAR had a total of 100,000 hectares in its land bank, mostly in Central and West Kalimantan.

“Our planting expansion rate is 50,000 hectares per annum. If we can get new allocations, we will maintain that rate,” he said, adding that the firm planned to apply for additional land allocations from the government before the land bank ran out.

“We will not necessarily wait until it’s gone. We will mainly concentrate on West and Central Kalimantan.”

Unilever and Nestle dropped Smart as a supplier following the Greenpeace reports. Industry giant Cargill has threatened to do the same if the accusations are proven correct in an audit due to be released on August 10.


Reuters