Diversification by Regional Plantation Companies (RPCs) into non-traditional areas such as palm oil cultivation and processing is showing good results, according to the Planters’ Association of Ceylon.
The AEN palm oil processing mill, a joint venture between Agalawatte, Elpitiya and Namunukula Plantations, is one such project that has shown impressive results in terms of high productivity, improved value addition and export capability and higher return on investments for the plantation companies while also benefiting domestic consumers.
In a press release from the Planters’ Association, General Manager of AEN Oil Palm Processing Pvt. Ltd Ruwan Goonewardene is quoted as saying that local production of palm oil has also reduced import dependence for vegetable oils and has helped consumers by stabilizing prices of vegetable oil. The company noted that the palm oil venture is a win-win operation for both the cultivator and the palm oil mill, as seen in countries such as Malaysia and Indonesia, where economies have grown due to such cultivation.
As a strategic step in crop diversification and based on the trends observed in the South Asian plantation industry, the press release stated that Agalawatte, Elpitiya and Namunukula plantations embarked on an Oil Palm Cultivation and Processing Project. The joint venture agreement was signed in 2000 and a BOI agreement to set up the palm oil processing facility was signed in 2003.
AEN expects to expand production over the coming years as demand for edible oil in Sri Lanka has reached around 10,000 metric tonnes per month. The three RPC’s are also hoping to expand cultivation to 4,000 hectares in the next three years from the current 3,000 hectares.