IOI and Mega Star to build coconut oil production complex in Malaysia

Malaysian plantation conglomerate IOI Corp has formed a joint venture with Singaporean investment company Mega Star Holding to build a coconut processing complex in Segamat, Johor.

According to IOI on November 6, the joint venture will require an estimated investment of 100 million Malaysian ringgit (US$24 million) and will combine the core business strengths of both corporations.

As part of the partnership, IOI said it will source and sell coconut oil to its subsidiaries and customers in the European Union (EU) and the US, while Mega Star will source and sell concentrated coconut water in China and other Northeast Asian countries through its group network.

According to IOI, upon completion in the fourth quarter of 2027, the integrated coconut processing complex will have a processing capacity of 100,000 coconuts per day and will produce products such as coconut oil and concentrated coconut water.

As the existing trees mature and IOI’s coconut plantations expand to approximately 5,000 hectares over the next two years, the company stated that the complex will gradually increase production to 300,000 coconuts per day.

“By combining IOI’s access to the international edible oil market and Mega Star’s access to the food and beverage market in China, we aim to supply… coconut products to meet growing market demand,” said Lee Yeow Chor, managing director and CEO of IOI Group.

According to IOI, the facility, located near IOI’s plantation land bank in Johor and adjacent to the Segamat inland port, will enable the company to source coconuts from approximately 3,700 hectares of coconut plantations, while the port’s location will facilitate the shipment of finished products.

Using robotics and IR 4.0 technology, the complex will incorporate a self-generating energy system, utilizing coconut shell byproducts as biofuel during the production process. IOI also stated that there are plans to convert another byproduct—coconut shells—into activated carbon.

According to The Star on November 6, Mega Star is part of Ting Hsin International Group, a Chinese conglomerate with extensive food and beverage operations in China and Taiwan.

Tags: coconut oil