16 February 2020: FGV Holdings Bhd is venturing into the dairy farm business with the purchase of a majority stake, total 60% in stake in RedAgri Farm Sdn Bhd (which owns the Bright Cow brand of dairy products) for RM10mil.
FGV, which started its life as the commercial arm of Federal Land Development Authority, known across Malaysia as Felda, is better known as one of the world’s biggest plantation companies and crude palm oil producers.
FGV said the acquisition marked its entry into the dairy farming business and fresh milk processing, the first step towards becoming an integrated agrifood company.
RedAgri currently processes 4,000 liters of fresh milk a day, which will be increased to 20,000 liters a day by 2022. Most of this increased production capacity is already committed to industrial and commercial customers, FGV said.
Most of the increased production capacity is already committed to industrial and commercial customers. With the support of contract farmers, the group will be able to increase production to meet more local demand.
Malaysia imports about RM3.9 billion worth of dairy products annually, as local production amounts for only 67.1 million litres per year or 61% of current domestic demand, according to FGV.
“The remaining 40 million litres are imported. The same scenario also applies to several other key food products, presenting opportunities for organisations such as FGV to benefit from import substitution, while also supporting the government’s vision for shared prosperity,” it said.
