13/10/2012 (Manila Bulletin) - Malaysia's Felda Global Venture (FGV), the world's largest producer of crude palm oil, has expressed interest to infuse huge investments in Mindanao after Manila and the Moro Islamic Liberation Front (MILF) agreed on a peace deal it viewed as “potentially opening up tracts of farm land."

The FGV is the first foreign investor to evince interest following the forging of a framework agreement by the MILF and the Philippine government (GPH) last Sunday in Malaysia to end the four decades of conflict in the impoverished southern region of Mindanao.

Mindanao, notably the Autonomous Region in Muslim Mindanao (ARMM), has the most suitable land in the Philippines for oil palms, Sabri Ahmad, chief executive of cash-rich FGV, said in a report posted Tuesday in the Chicago Times.

"We will go there for oil palms…There is ample area for oil palms to meet strong local demand," Reuters correspondent Niluksi Koswanage quoted Sabri as saying.

FGV has a $3.1-billion listing earlier this year, at the time the world’s largest after Facebook's IPO, and planned to use the funds to expand in Southeast Asia and Africa, the Reuters report said.

According to the report, the Philippines imports more than 500,000 metric tons of crude palm oil a year to meet strong local demand for the product, used mostly for cooking. The eventual opening of palm oil farms and plants in Mindanao would reverse the trend and make the region a top crude palm oil producer, it said.

Sabri said FGV would need to invest in at least 10,000 hectares to gain economies of scale, hinting the figure could be increased in several folds depending upon the response of residents and officials in ARMM and nearby Mindanao provinces.

According to Philippines Palm Oil Development Council (PPODCI) estimate, Mindanao has about one million hectares of grasslands, equivalent to the size of Puerto Rico that can be turned into oil palm estates.

In late 2010, a delegation of ARMM officials led by then Executive Secretary Naguib Sinarimbo went to Malaysia and met FGV officials in a three-hour meeting covered by the Manila Bulletin.

On request of the visiting team, FGV officials offered to absorb 4,000 Filipino workers in its vast palm oil plantations in Malaysia, and at the same conveyed interest in massive opening of farms in ARMM areas and nearby provinces.

The delegation, which was dispatched by then ARMM Acting Governor Ansaruddin Adiong, told FGV officials about existing wide palm oil farms in Lanao del Sur and Maguindanao. Both ARMM component provinces have thousands of untapped lands for palm oil farming, it said.

The FGV and ARMM initial arrangement though had been overtaken by the leadership change in the autonomous region in late 2011.