PETALING JAYA: FGV Holdings Bhd and its public listed subsidiary MSM Malaysia Holdings Bhd are expediting plans to develop a new agriculture growth area called the FGV Agro Food-Valley in Chuping, Perlis.
The decision was made following the rescission of the sales and purchase agreement between MSM’s wholly-owned subsidiary MSM Perlis Sdn Bhd and F&N Agrivalley Sdn Bhd on April 9, 2020.
FGV group CEO Datuk Haris Fadzilah Hassan stated that the project is expected to redefine the agricultural industry landscape in Perlis as it will adapt Industrial Revolution 4.0 approaches incorporating modern technologies and mechanisms, sustainable development and value-added activities.
“The entire development of the project involving investment of RM100 million within two years will continue to fortify the national agro-food sector whilst assuring food security for the country,” he said in a statement today.
The group and several of its subsidiaries are in final stage discussion to develop various food-based production areas in Chuping as part of a comprehensive effort to enhance the plantation sector in Perlis.
It revealed that the integrated development of the 4,400ha land aims to cultivate high quality alternative crops in the four main agrofood sectors including cassava for starch production, MD2 premium pineapple, harum manis mangoes and animal feed production based on cassava by-product of starch and biomass.
FGV planned to build a factory with a capacity of 50,000 MT per year for the production of cassava starch and maltodextrin.
In addition, the cassava also has the potential to be utilised as a substance for industrial production of bio-ethanol, bio-fuel, bio-plastic, amino acid, polyols, pharmaceutical and animal feed.
It calculated that the production of animal feed from the by-product of starch and biomass can yield up to 22,000 MT per year, and this will cater to the demand from local dairy farmers including the group’s subsidiary FGV Dairy Farm.
Haris said that each acre of cultivation could potentially yield up to 30 tonnes and FGV is willing to offer buy back guarantee which could help farmers to expand their revenue stream.
He pointed out that the global cassava market is expected to register a growth rate of 3.2% from 2019 to 2024 to reach a market value of US$$4.5 billion (RM19.64 billion) by the end of 2024.
“Currently, Malaysia imports 600,000 MT of cassava starch, and FGV Agro Food-Valley may substitute 8% of Malaysia’s imports of cassava starch,” said the group CEO.
FGV stated the project is in line with the government’s proposition to bolster domestic economy sector to reduce the impact from Covid-19.
Furthermore the development of FGV Agro Food-Valley will offer more than 300 employment opportunities to the local community and provide business prospects for the local and agro youth farmers especially among the B40 group through the farming contract as well as secondary industries such as logistics and supplies.
MSM group CEO Datuk Khairil Anuar Aziz commented that it will continue its focus to rationalise group wide capacity through consolidation of production to enhance operational capabilities.
“The strategic consolidation will also reduce financial impact with regards to optimum capacity utilisation and prudent cost management across the supply chain,” he said.