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Oil Palm Plantation Company Benchmarking Service

LMC’s new quarterly report presents key technical and cost performance benchmarks by plantation company in both Malaysia and Indonesia.

The rationale for the report is that headline numbers reported by companies don’t tell you the whole picture and making comparison between companies is difficult or is not possible with the data that is made available. Reported yields often take no account of differences in the age profiles of trees and their corresponding levels of production. This also distorts any reported estimates of production costs. This can lead to a distorted view of a company’s true performance, with potentially implications for a company’s share price.

LMC takes into account the differences in the age profiles of trees and uses this to estimate the underlying level of performance. This approach, together with the engineering (or budget) approach that we apply to cost estimation, ensures production costs are also measured on a consistent basis across companies and industries.

Using this technique the service:

  • maps a company’s geographical footprint
  • develops cost estimates on the basis of the volume of inputs used in the production process
  • applies local input prices, (notably labour costs) taking into account the geographical distribution of the plantations managed by the company
  • applies both reported and adjusted yields for the age profile of the plantation
  • projects cost estimates over the next three years

LMC’s performance benchmarking reveals the true performance of a company against its competitors by:

  • comparing FFB, CPO and OER yields for individual palm oil companies against their peers (companies with a similar area under palm) as well as against regional and national averages
  • assessing how reported yields are affected by the age distribution of their estates

LMC has completed a painstaking analysis of oil palm plantings in each year, by company, to arrive at detailed age profiles for each company so that we can adjust their yields and costs accordingly. This gives a true measure of performance.


Main features of this service:


Quarterly analysis and reporting of individual company performance, covering:

  • LMC’s estimates of production costs by region in both Malaysia and Indonesia
  • Estimates of individual companies variable costs
  • Estimates of individual companies variable costs adjusted by the company’s age profile
  • Geographical focused cost comparisons
  • FFB yields
  • OER
  • CPO yields
  • FFB, OER and CPO yield growth
  • Age profile of estates from 2000 by Immature, Young, Prime, Ageing and Old
  • Adjusted FFB, OER and CPO yields and yield growth
  • Conclusion of performance

Featured companies


The following companies are currently available:

In Indonesia:

  • Astr Agro Lestari
  • Austindo Nusantara Jaya
  • Bumitama Agri
  • BW Plantation
  • Dharma Satya Nusantara
  • First Resources
  • Golden Agri Resources
  • Gozco Plantation
  • Indofood Agri Resources
  • Kencana Agri
  • New Britain Palm Oil Ltd (PNG)
  • Sampoerna Agro Tbk
  • Sime Darby

In Malaysia:

  • FGV
  • IOI
  • KLK
  • Sime Darby
  • Genting Plantation

More companies in both Indonesia and Malaysia will be added as the service continues. Please contact us if you want us to analyse a company not currently featured.

Terms
FFB – Fresh Fruit Bunch
OER – Oil Extraction Rate

For more information or to subscribe please email lchen@lmc.co.uk

 

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