Golden Agri-Resources opens oleochemicals plant in Indonesia

Golden Agri-Resources, a producer of crude palm oil and palm kernel, on Thursday said it launched a major downstream fatty alcohol facility in Indonesia.

Golden Agri-Resources
Golden Agri-Resources website

Golden Agri-Resources, the world's second-largest palm oil producer, on Thursday said it launched a major downstream fatty alcohol facility in Indonesia.

The plant is owned by Sinar Mas Cepsa, a joint venture between Golden Agri-Resources and Cepsa, a global integrated energy company with an investment of S$484 million made over two years.

The Dumai, Sumatra-based plant will produce fatty alcohols from sustainably-sourced palm kernel oil, a key ingredient in the manufacture of everyday products such as household cleaning goods and personal care products, it said in a statement.

The global market for natural fatty acids is predicted to reach $16.2 billion by 2021, up from $12.4 billion in 2016. Of this, a bulk of the revenue generated will come from Asia-Pacific which currently commands over 65 percent of overall capacity.

"We have a diversified portfolio, leading in the areas where we operate in the chemical industry. Entering the fatty alcohols value chain is another step in our internationalisation plan, and ensuring we partner with a reputed and trusted domain expert was paramount," said Cepsa's Vice-Chairman and CEO, Pedro Miró.

The Dumai plant has an annual production capacity of 160,000 metric tonnes of fatty alcohol per year.

Sales of the vegetable-based alcohols, increasingly in demand as a raw material for personal care products and liquid detergents, will primarily focus on markets in Asia.

The plant will also service demand from Sinar Mas Cepsa's surfactant plant in Germany, which serves markets in Eastern and Western Europe.