IOI Corp Bhd has teamed up with Wild Asia, a local sustainability and technical support group, to help add more value to small producers within the plantation giant’s supply base.
IOI Corp said in a statement today that its responsible sourcing team under commodity marketing had completed its first physical raw material connection with the Wild Asia Group Scheme (WAGS) programme.
“The WAGS aims to build a network of small producers that are working on their land sustainably towards enhancing essential soil organic matter and growing healthy produce for the betterment of our ecosystem, communities and the environment,” IOI Corp said.
Currently, a group in Perak consists of 356 certified small producers, producing an estimated annual volume of 5,804 metric tonnes (MT) of crude palm oil and 653MT of palm kernel oil.
IOI Corp said this physical connection would be used by IOI Oleochemical Industries Bhd to complete its customers’ orders.
“This connection provides a new incentive to WAGS farmers as an additional marketplace for their Roundtable on Sustainable Palm Oil (RSPO)-certified sustainable palm oil,” IOI Corp said.
By establishing this physical connection, IOI Corp said it would provide financial benefits across three parties.
“The first benefit is additional income enjoyed by the farmers who are rewarded for implementing responsible and sustainable best practices and meeting NDPE (no deforestation, no peat and no exploitation) requirements.
“The second financial benefit goes to the local WAGS team for their technical support in training and systems, and to facilitate new smallholders to similarly implement best practices.
“The third financial benefit goes to the independent miller, Tian Siang Oil Mill (Air Kuning), as an incentive for its commitment and support for sustainable production,” IOI Corp said.
“IOI Corp is now targeting similar groups in Sabah that are within the Wild Asia portfolio,” the group added.
IOI Corp’s shares closed RM4.50 today giving the planter a market capitalisation of RM28.28 bil.
