POSCO International formally launched PT Prime Agri Resources (PT.PAR) in Jakarta on Wednesday, completing a ₩1.3 trillion (USD 855 million) integration of Indonesian palm oil company Sampoerna Agro and sealing a full seed-to-biofuel value chain the company has been building since 2024.
Chief Executive Lee Kye-in presided over the ceremony alongside Korean Ambassador Yoon Soon-gu and Indonesian Palm Oil Association Chairman Eddy Martono. The event marks the end of a two-year post-merger integration process that added 128,000 hectares of palm plantation in Sumatra and Kalimantan to POSCO International’s existing operations.
The company now controls 154,000 hectares of palm plantations in Indonesia — roughly 2.5 times the area of Seoul — through three subsidiaries: PT.PAR (Sumatra and Kalimantan, 128,000 ha), PT.BIA (Papua, 26,000 ha), and PT.ARC, a refining joint venture with GS Caltex in Balikpapan that processes crude palm oil at an annual capacity of 500,000 tons.
POSCO International said it expects palm-segment operating profit to more than double in 2026 on the back of expanded production and the addition of Sampoerna’s seed-development subsidiary, ranked among Indonesia’s top two palm seed producers.
Context
The Indonesian palm oil sector is the world’s largest, accounting for roughly 60 percent of global supply. POSCO International began building its agribusiness position in Papua more than a decade ago but accelerated into a full value-chain play with the USD 855 million Sampoerna acquisition announced in 2024. The seed business is strategically significant: high-yield certified seeds can lift plantation productivity by 20–30 percent and typically take 4–5 years to show results in commercial plantings.
Completing the refinery link via PT.ARC with GS Caltex removes the final margin step from the value chain. Refined palm oil and its derivatives — oleochemicals and hydroprocessed esters and fatty acids (HEFA) used as sustainable aviation fuel feedstock — command premiums of USD 50–150 per ton over crude palm oil, depending on grade and certification.
POSCO International (047050.KS) is the trading and energy arm of Posco Group and is separately listed from Posco Holdings. The stock has rallied alongside the broader KOSPI, which closed above 9,000 for the first time on Wednesday.
Lee said the company aims to establish itself as a “leading global platform for food and bio-materials,” a positioning that distinguishes POSCO International from pure commodity traders by emphasising downstream processing and proprietary seed technology.
Sources: Korea Herald (June 18), The Korea Times (June 18), POSCO Newsroom
