United Plantations
Description and Criticism : November 2008
FROM its inception in 1906, United Plantations Berhad has grown to become one of the largest plantation groups in the world and is now a public company quoted on the Malaysia stock exchange (the Bursa).
The company’s principle business activity is the cultivation and processing of palm oil, coconut and other plantation crops in Malaysia and Indonesia, (two of the most corrupt countries in the world according to Transparency International) and it claims to do this in a sustainable manner. (see Criticism below)
Its subsidiary companies are engaged in several downstream activities such as; processing palm oil, manufacturing, packing and distribution of end products in the form of cooking oils, edible oils, specialty fats and soap products.
United Plantations claims to be one of the most efficiently managed and integrated plantation companies in Malaysia and says it is well known globally for its best agricultural practices and high quality standards.
The company’s total landbank in Malaysia consist of approximately 40,874 hectares. The main focus is to make a profit for shareholders from cultivation of oil palms (90%) and coconuts (10%).
Also in Malaysia, United Plantations operates six palm oil mills and the Unitata refinery, a subsidiary that has been cooperating for a number of years, on a joint venture basis, with AarhusKarlshamn AB, a leader in the global speciality fats sector.
AarhusKarlshamn AB is a Swedish company listed on the OMX Nordic Exchange in Stockholm. It owns brands such as Prep and LessCal.
With the acquisition of two Indonesian plantation companies in 2006 the total hectarage in Indonesia will be approximately 40,000 hectares which is expected to be developed over the next 10 years. Development is progressing as planned and is expected to provide rich pickings for investors.
United Plantations claims to be known for its high level of social responsibility and environmental awareness (see Criticism below), and also for its leading role in the research and development of high yielding palm products.
United Plantations possesses considerable know-how in plant breeding, agronomy, and micro-propagation through its own R&D facilities for the development of new and improved planting materials as well as improved crop husbandry practices.
This has resulted in United Plantations being recognized as one of the highest yielding, cost-competitive and innovative plantation companies in Malaysia.
The company believes that its connection with the AarhusKarlshamn group is seen as a very important business strategy in providing traceability and thereby the ability to control raw materials from source to final product - contrary to many other refineries, who have to source their raw materials from the open market.
In other words, it likes to promote its connection with AarhusKarlshamn because it sees this as good PR.
Criticism
According to Greenpeace research (November 2008), United Plantations, a supplier of Nestlé and Unilever - is involved with deforestation in the vulnerable peatland forests of Kalimantan in Indonesia.
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