FGV targets eight-fold growth, top 10 agri-business slot
Kuala Lumpur – Felda Global Ventures Holdings Berhad (FGV) is targeting an eight-fold increase in sales to RM100 billion (€23 billon) and a top 10 position in the global agribusiness sector, the Malaysian group said 14 July.
The target is to be delivered by a new “lean yet scaleable” organisational structure, said FGV, which claims to be the world’s largest palm oil producer and is also a major supplier of natural rubber and sugar.
FGV is now re-structured into six clusters; the oil palm upstream, oil palm downstream, rubber, sugar, R&D and TLMO (transport, logistics, marketing and others). Each unit has drawn up its own strategic initiatives to achieve its targets by 2020.
“This transformation journey will be [supported by] the implementation of group-wide transformation initiatives,” Said Mohd Emir Mavani Abdullah, FGV’s group president and CEO. “The eight fold growth target will significantly shift FGV’s global competitive position.”
The palm upstream cluster aims to retain a global leadership position in plantations by being the largest CPO producer and holding the largest landbank.
The downstream segment is targeting higher margin and high-growth products in speciality ingredients segment to become one of the world’s top three players in industrial fats and regional heavyweight status in palm-based consumer goods. The cluster is also pursuing significant shares in the biodiesel and renewable energy market globally.
The newly-formed rubber cluster, which is currently focused on rubber processing, expects to become a leading integrated rubber player and become the world’s third biggest supplier of processed rubber. This, said FGV, will be driven “by midstream growth, upstream expansion, downstream ventures and trading activities, giving the cluster complete control of the value chain.”
Through MSM Holdings, FGV is among the world’s largest sugar producers and now aims to increase raw sugar production to complement its downstream business. The cluster aims to be one of the top global companies in refined sugar business, with production volume of four million metric tonnes by 2020.
The group’s R&D cluster aims to be the top private oil palm research institution in the world, and to be a leading research institution in rubber and sugar. It will provide agri-based products and services for both internal and external parties.
The application of the research, such as clone seedlings, by the downstream sector is crucial to support the internal growth across all FGV clusters, the group said.
The TLMO cluster strives to be a global leader in trading, logistics and storage by 2020. It will complement palm oil trading and be a strategic enabler for other core businesses.
“Across the group, there is a strong belief that this transformation journey will lead to success and we are confident of achieving our goals,” concluded Mohd Emir, who took over at the FGFV helm a year ago.