Malaysian plantation conglomerate IOI Corp has formed a joint venture with Singapore-based investment company Mega Star Holding to develop a coconut mill complex in Segamat, Johor.
The joint venture would involve an estimated investment of MYR100M (US$24M) and would combine the core business strengths of both corporations, IOI said on 6 November.
As part of the partnership, IOI said it would offtake and market coconut oil to its associate companies and customers in the European Union (EU) and the USA, while Mega Star would offtake and market concentrated coconut water to China and other Northeast Asian countries through its group network.
The integrated coconut mill complex would have a processing capacity of 100,000 coconuts/day on its completion in the fourth quarter of 2027 and would produce downstream products such as coconut oil and concentrated coconut water, IOI said.
As existing trees matured and IOI’s coconut plantations expanded to approximately 5,000ha within the next two years, the company said the complex would progressively scale up production to 300,000 coconuts/day.
“By combining IOI’s access to the international edible oil market and Mega Star’s market access to the food and beverage sector in China, we aim to deliver … coconut products to meet growing market demand,” said Lee Yeow Chor, IOI Group managing director and chief executive.
Located close to IOI’s plantation landbank in Johor and next to the Inland Port of Segamat, IOI said the facility would enable it to supply coconuts from approximately 3,700ha of coconut plantations while the port location would allow shipment of finished products.
Using robotic and IR 4.0 processing equipment, the complex would incorporate a self-generating energy system by using coconut husks by-products as biofuel in the production process and IOI said there were also plans to convert another by-product, coconut shells, into activated carbon.
Mega Star is affiliated to Ting Hsin International Group, a China-based conglomerate which has an extensive food and beverage business across China and Taiwan, according to a 6 November report by The Star.
