POSCO International Corp. has completed a ₩1.26 trillion ($862 million) capital injection into Agpa Pte Ltd., securing full ownership of the Singapore-based holding company that manages the South Korean trader’s palm oil operations across Southeast Asia. The investment was made through a rights offering subscription.
The transaction comes as the company prepares to complete a palm oil refining plant this month in partnership with GS Caltex Corp. in Kalimantan, Indonesia, with annual capacity of 500,000 tons. The facility, which received a combined ₩260 billion investment from both partners, will produce bio feedstocks and edible oils for Indonesian and regional markets.
POSCO International currently operates three oil extraction plants in Papua, Indonesia, producing 210,000 tons of palm oil annually. The company entered the sector in 2011 through plantation development and began commercial production five years later.
The consolidation reflects broader expansion ambitions in agricultural commodities. To operate the new refining facility at full capacity, the company needs to secure an additional palm oil production capacity of 300,000 tons, according to recent industry reports. Management is reportedly considering acquisitions of local plantations to support the refinery’s operations.
Palm oil profitability has strengthened significantly due to supply constraints and Indonesia’s expanding biodiesel mandates, which require 40% palm oil blending in all diesel fuels this year.
