No direct exposure to Indonesia fires: Olam
The group says it was not aware of any formal regulatory inquiries or notices relating to the fires
[SINGAPORE] Neither Olam Group nor Olam Agri owns or operates oil palm plantations or concessions in Indonesia, and therefore has no direct operational exposure to recent forest and peatland fires, the agri group said on Wednesday (Oct 21).
The group was responding to queries from the Singapore Exchange Regulation on whether its activities may have contributed to transboundary haze in the region.
The mainboard-listed group also pointed out that Olam Agri had ceased to be a subsidiary of the group in April this year following its sale to a Saudi fund.
Although about 70 per cent of Olam Agri’s global palm oil sourcing volume comes from Indonesia, the company operates mainly as an intermediary trader, sourcing from third-party refineries, said Olam Group.
Olam Agri does not own or operate oil palm plantations, mills, refineries or other palm oil processing facilities in the country.
Responsibility for directly preventing or suppressing fires and managing land rests with upstream landowners and plantation operators, the group said.
Nevertheless, Olam Agri manages upstream environmental risks through monitoring, supplier engagement and a responsible sourcing framework.
The group said it was not aware of any material impact on Olam Agri’s palm oil sourcing operations arising from the recent fires.
The group also said it was not aware of any formal regulatory inquiries, notices or notifications relating to the recent fires.
As part of its monitoring process, Olam Group said it had reviewed recent fire alerts, stakeholder reports and media coverage concerning fires in Indonesia.
“Mills and corporate groups referenced in external reports have been screened against Olam Agri’s supply chain and relevant suppliers and affiliated groups have been engaged for clarification where appropriate,” the group said.
Several cases have since been clarified by the companies concerned, while others remain under internal assessment or are awaiting further information from suppliers and affiliated groups, it added.
It does not expect matters relating to the fires to have any material operational, financial, legal, regulatory or reputational impact on the group.
Shares of Olam rose S$0.01 or 1.1 per cent to S$0.91 before the announcement.
