The group has given its commitment to comply with Wilmar’s Integrated Policy.
KUCHING: Jaya Tiasa Holdings Bhd (Jaya Tiasa) has announced that the group will discontinue planting on its remaining plantation land bank representing 0.4 per cent or circa 280 hectares (ha) of its estimated plantable area of 69,873ha.
The group has given its commitment to comply with Wilmar’s Integrated Policy, outlined research firm AmResearch Sdn Bhd (AmResearch).
Recall that at end-2013, Wilmar launched a ‘No Deforestation, No Peat, No Exploitation’ policy that aims to advance an environmentally and socially responsible palm oil industry. Planters were given a grace period till end-2015 to stop planting in peatlands.
Jaya Tiasa said it will implement ‘Best Management Practices’ on existing plantations on peatlands as defined by the RSPO or peat experts.
“We are neutral on this as Jaya Tiasa’s remaining plantable area is not significant, while the news of the Wilmar planting policy has long been factored in,” AmResearch opined in yesterday’s report.
“This means the end of the group’s oil palm capital expenditure (capex) cycle, which will be positive for cash flows. Its developed and planted area remains sizeable at roughly 69,600ha.”
Regardless, it believed Jaya Tiasa is on track to achieving its FFB production assumption of 900,000 tonnes for FY6F.
“We continue to believe it would be able to produce at full-fledge a steady-state tonnage of circa 1.5 million tonnes annually.
“We understand that sustained efforts are being carried out to rehabilitate 10,000ha of planted areas that had been neglected previously. This could take over a year.”
Meanwhile, in a separate statement, Jaya Tiasa also confirmed that it had been cleared by the Malaysian Anti- Corruption Commission (MACC) of any illegal logging activities.
It said the MACC had lifted the suspension of a bank account that was frozen in relation to its investigation into illegal logging.
JTIASA (4383) - Neutral on Jaya Tiasa’s discontinued planting on remaining landbank
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