Sumitomo Forestry : Indonesian JV enters wood pellet manufacturing and sales business～ for a stable supply of wood biomass fuel ～
1911.T
Sumitomo Forestry Co., Ltd.
September 20, 2024
For Immediate Release
Indonesian JV enters wood pellet manufacturing and sales business
~for a stable supply of wood biomass fuel~
Sumitomo Forestry Co., Ltd. (President and Representative Director: Toshiro Mitsuyoshi;
headquarters: Tokyo; hereinafter Sumitomo Forestry) has entered wood pellet manufacturing and sales business. An Indonesian joint venture company PT. Biomassa Lestari Nusantara (President: Efendi Sulisetyo; hereinafter, BLN) has commissioned (operational trial) of the first wood pellet plant in September. Sumitomo Forestry Group will purchase all the pellets and sell them primarily to biomass power generation plants in Japan. BLN was established in 2023 in Central Java Province, Indonesia, as a joint venture
between PT. Sumitomo Forestry Indonesia (President: Fumihide Nakatsu; hereinafter, SFI) and PT. Dharma Energi Investama, an energy-related wholly owned subsidiary of PT. Dharma Satya Nusantara Tbk (President: Andrianto Oetomo; hereinafter, DSN Group). DSN Group will be in charge of the manufacture of wood pellets and the collection of raw materials. Sumitomo Forestry Group will be in charge of quality control and wood pellet sales.
■Business outline and aims
By having a manufacturing site within our own Group operations, we will be able to avoid the impact of unexpected external factors and provide a stable, long-term supply of reliable quality wood pellets. This project will promote the cascade use of trees to maximize the value of trees and promote decarbonization.
■Background
The Sixth Strategic Energy Plan announced by the Ministry of Economy, Trade and Industry's Agency for Natural Resources and Energy raised the biomass power generation ratio target from 3.7%~4.6% to 5% by fiscal 2030. With the increased importance of wood biomass as a baseload power source,* we forecast that the demand for wood pellets for biomass power generation fuel will rise.
*Baseload power source: a power supply that can consistently and reliably provide a steady amount of electricity at low cost, regardless of the season, weather or time of day.
Following Russia's invasion of Ukraine, the supply of fuel for power generation (natural gas, coal, wood pellets, etc.) has become both unstable and tight worldwide and wood pellet prices have skyrocketed. While the supply-demand situation has since stabilized, it is important that the supply system be structured to anticipate such contingencies to ensure the long-term operation of biomass power generation plants.
＜DSN and Sumitomo Forestry Group's relationship＞
Sumitomo Forestry Group began working with the DSN Group in the 1990s to import plywood. For many years, we have been supplying floor base plywood for home flooring primarily in Japan. In addition to our existing plywood business, we will use our collaboration in the wood pellet business to further our efforts in the renewable energy sector together.
■Joint venture company outline
Company name
PT. Biomassa Lestari Nusantara
Location
Boyolali Regency, Central Java Province, Indonesia
Representative
Efendi Sulisetyo
Capital
USD 12 million （ including Phase 2, planned ／ investment ratios: PT.
Dharma Energi Investama 51%, Sumitomo Forestry Indonesia 49%)
Establishment
April 2023
Employees
52 (as of 1st September 2024)
Business description
Manufacture and sale of wood pellets for fuel
Production volume
Phase 1: 60,000 tons/year (from September 2024)
Phase 2: 120,000 tons/year (from 2026, planned)
Raw material used
Wood wastes and unused small-diameter logs, from nearby wood
processing plants and forests
■DSN
Company name
PT. Dharma Satya Nusantara Tbk (listed on the Indonesia Stock Exchange)
Location
Jakarta, Indonesia
Representative
Andrianto Oetomo
Capital
Rp211,997 million
Employees
20,274 (as of December 2023)
History
1980: Sawmill established (Samarinda, East Kalimantan Province)
1988: Bare core, block board factory established (East Java Province)
1997: Entered the palm oil business (Kalimantan)
2005: Established a plywood factory (Temanggung Regency, Central Java
Province)
2013: Listed on the Indonesia Stock Exchange (IDX)
Business description
Palm oil business, wood processing business, renewable energy business
Affiliated companies
Palm oil business: 29 companies
Wood processing business: 5 companies
Renewable energy business: 3 companies
■DEI
Company name
PT. Dharma Energi Investama
Location
Jakarta, Indonesia
Representative
Soediono
Business description
Renewable energy businesses
■SFI
Company name
PT. Sumitomo Forestry Indonesia
Location
Jakarta, Indonesia
Representative
Fumihide Nakatsu
Business description
Sale of wood products, adhesives and building materials; housing real
estate development operations in Indonesia; conservation of mangrove
forests through a subsidiary
Sumitomo Forestry Group is engaged in a broad range of global businesses centered on wood, including forestry management, the manufacture and distribution of wood building materials, the contracting of single-family homes and medium- to large-scale wooden buildings, real estate development, and wood biomass power generation. In our long-term vision Mission TREEING 2030, we are seeking to promote the Sumitomo Forestry Wood Cycle, our value chain to contribute to decarbonization for not only our own company but also for the whole of society by increasing the CO2 absorption of forests and popularizing wooden buildings that store carbon for long periods of time. We will continue our efforts to accelerate decarbonization by promoting the use of wood and wood-derived materials and the substitution of wood for other materials in construction.
【Reference】
A commissioning ceremony at BLN was held on September 20th.
Disclaimer
Sumitomo Forestry Co. Ltd. published this content on 20 September 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on September 20, 2024 at 07:34:07 UTC.