BULKING & STORAGE CHALLENGES AND MITIGATION CHALLENGES MITIGATION ACTIONS RESULTS • Extreme weather patterns, including El Niño and La Niña, disrupting operations and reducing crop yields. • Implemented a throughput charging strategy while diversifying the product portfolio by handling more premium products and venturing into commercial activities related to biomass feedstock. • Sustained business revenue and profitability. • Geopolitical unrest, conflicts, and vessel hijackings in export markets increased risks and complicating trade flows. • Limited expertise in handling diverse product categories beyond edible and non-edible oils, restricting diversification into other potential product portfolios. • Actively engaged potential business partners with extensive industry expertise while exploring expansion opportunities. • I mproved the process of identifying and evaluating strategic partners to strengthen business collaborations and foster long-term growth. • U nderdeveloped presence in key markets such as Indonesia, the Middle East, and North Africa, limiting market access and growth opportunities. • Shifts in market demand from bulk to containerisation, challenging existing logistics and supply chain capabilities. • Initiated exploration of the containerisation business as part of product diversification efforts. • Built a robust knowledge base to identify new revenue opportunities and support future growth. Strategically located in Johor, our bulking facilities support efficient flow of downstream products to global markets. OUTLOOK AND PROSPECTS In 2025, the Bulking and Storage business will continue operating in a complex landscape shaped by rising biofuel demand, evolving sustainability regulations, and shifting global trade dynamics. Expanding renewable energy mandates in key markets are expected to drive demand for specialised storage, while geopolitical tensions, volatile freight costs, and changing trade policies may disrupt trade flows and storage utilisation. To capitalise on opportunities, we are expanding storage capacity and diversifying product offerings. The Terminal 4 expansion at Pasir Gudang is set to support demand for acid products and crude vegetable oil, while the 44,000 MT expansion at Terminal 2B will enhance storage for renewable feedstocks such as used cooking oil (UCO) and waste oil. These developments will strengthen our ability to handle premium and specialised products. Strategic collaborations with industry players support the handling of larger premium oil volumes, enable petrochemical storage expansion, and unlock broader revenue streams. We will also prioritise cost efficiencies and operational improvements, including the transition of boiler operations from diesel to natural gas. With these initiatives, FGV’s bulking and storage business is positioned for sustained growth in a rapidly evolving market. 106 FGV Holdings Berhad | Annual Integrated Report 2024 Business Review: Logistics & Support Division
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