11/02/2011 (The Star Online) - Kulim (M) Bhd is allocating RM20mil capital expenditure (capex) for replanting programmes in its local oil palm plantations this year.

Managing director Ahamad Mohamad said the company still had some 700ha of oil palm plantations, including 1,300ha belonging to Johor Corp (JCorp), for the replanting of old oil palm trees.

“We are expecting to finish our replanting activities in the remaining 2,000ha tracts of the oil palm land by 2014,'' he told StarBiz after the company EGM yesterday.

At the EGM, shareholders approved the proposed share split involving the subdivision of every one ordinary share of 50 sen into two ordinary shares of 25 sen each.

They also approved the proposed bonus issue on the basis of one bonus share for every one subdivided share held after the proposed share split. They also gave the green light to increase Kulim's authorised share capital from RM200mil made of 400 million shares to RM500mil of 2 billion subdivided shares and proposed one warrant for every eight subdivided share held after the share split.

On whether the recent floods in Johor had caused severe damage to its plantations, Ahamad said only small areas in Kluang and Kota Tinggi were affected.

Kulim currently has some 36,000ha planted with oil palm in Malaysia, 120,000ha in Papua New Guinea and Solomon Islands of which 76,000ha were already planted while 44,000ha have been slated for planting programmes.

The company also manages some 24,000ha of JCorp's plantations in Johor.

Ahamad said the current political situation in the Middle East had not affected demand for palm oil there as it remained the cheapest available edible oil for consumers.

“We are more worried by the weather patterns, such as La Nina and El Nino, than political instability as changes in the weather can affect our production,'' he said.

Ahamad said the prospects of oil palm plantation business in Papua New Guinea and Solomon Islands were good as there were still large tracts of land available.