Ideal developments back
The ideal developments consider an average top price development as it was for the last 5 years. It reflects also the changing demand for starch related products.
With investments 11 million Euros the result per year will be almost a turnover of 25 million and a profit of over 17 million before tax.
Some indicators as the net present value, NPV, are 150 million for an investment period of 10 years, with a 40% required earnings 12 million.
The payback period of 2½ years and the internal rate of revenue (IRR) is about 70%. These figures are really interesting.
Outline of the project
The plan involves an integral approach to the supply chain of sago starch. The plan integrates the processes from first production of basic produce unto products brought to market. The plan systematically integrates all steps from potential market relations to one fully controlled process.
First step in the process is to develop a natural environment into a plantation. These first actions involve the preparation of the production of logs out of an abundance of full-grown sago plants. Sago for starch production is already there. Competing sago plants and other vegetation has to be elaborated and thinned. Maintenance and the preparation of harvesting start from the beginning.
This requires also a production site for sago starch preceding the fully developed plantation.
Process steps for the project
1. build a road as connection to the infrastructure
2. create a site for housing and production to build barracks
3. build store rooms, offices and houses
4. start constructing a factory building and production facilities for sago starch
5. roll out the selection of trees to harvest, to cultivate and to cut the brushwood
6. lay out the plantation borders
7. dig ditches for water regulation and canals as transport facilities
8. dig ditches and create plantation lots
9. start cutting plants for starch production as soon as the production site is ready
10. finalize the set up development of the pilot project
11. fill in the economic, social economic and environmental research and develop it into the future as a learning, reciprocal and multiplying organization
For now this is the end of the supply chain of starch. The product sago starch will be offered on the world market as such, a high quality starch.
Place and environment
The production of this basic product will take place in the swampy area of Kabupaten Jayapura,
Approach running start cultivation sago forest
The running start of cultivating grows a sago forest considering the possibilities of sustainable forestry. The idea of cutting all interesting plants and leave the rest to re-develop itself again is a waste of natural potential. It presupposes optimal plants can be selected and processed. But it seems less realistic in practise because of the proportions.
The situation of the forest is set forward by a few facts. Per hectare forest there are about 360 sago plants. 66 of these plants are potential starch producers. Research showed that 3 out of 11 plants are producers of economically harvestable sago starch. These are the relevant plants; these 3 out of 11 are the plants to foster.
The basic idea is to cut plants that do not contribute to the economic production of sago starch. Cutting these (sago) plants will create more space for the high potential sago plants to generate as much starch as possible. This approach creates also space to nurture siblings, space for harvesting and transport. The open space may also give way for other controlled activities as housing, domesticated animals and crops.
The start situation is jungle. The wild sago forest is a tight forest with a swampy soil and varied vegetation. The first task is to select the high potential plants. Fully grown plants have to be selected for harvesting. These are the 8 to 10 years old. The 6 to 8 years old high potentials have to be prevented from being cut. The 4 to 6 year old high potential plants have to be saved at a distance of 5 m from the big plants and their fellow plants. This distance has to be decided on in relation to the harvestable plants preferred.
The rest of the plants will be removed. Removed plants will be stored for construction, trading, compost or as source of energy. Later the residue of fuelled plants may also be used as additive for the compost fertilizer to renew the plant population.
The 0 to 2 years old have to be taken care of. A basket may be useful for the smaller plants that have to safeguard. Especially the siblings have to be located carefully, and eventually combined with sowing seed or slips from elsewhere (Sentani) to improve the sago plants population. Once vested, the root system will secure the further growth of high potential plants.
The system that helps to improve plants is a hazardous system that regenerates the low potential plants. A selection instrument has to be developed to select the better plants in an early stage. This will be done systematically with research institutes.
Natural Sago production is about 3 tons/ha. Goal is sustainable production. Semi-wild cultivation brings ca. 10 tons/ha where an intensive cultivation brings about 24 tons/ha.
The pilot production size has been set to 30.000 tons for the pilot project. This is the lowest optimal size of a full flow starch production installation. Larger installation will be created at an estimated 60% larger costs.
For the high potential plants goes that the age of the palm in combination with leaf production reveals starch production. Starch is formed after the leaf production drops from 2 to 1 per month.
Sago plants contain the highest proportion of starch just before flowering. Highest starch production per trunk is just before fruit forming. On a small scale even palm sugar could be interesting.
If a production of dry sago starch of 10 ton/ha can be realized only by cultivating, 3.000 ha will be enough to provide for a 30.000 tons dry starch factory.
Half of the investment is needed for a state of the art factory to extract starch out of the natural produce. The efficiency of the machinery is over 90% (95%). Machines will be powered by separate generators running on bi-fuel, diesel and methane. Waste water will be cleaned before returning into nature.
The first objective is to focus on the primary product. There is an option to multiply the produced value by a factor 3 or 4 by adding a second process to manufacture another modern industrial quality.
The rest of the investment is needed to create an infrastructure in a forest containing plants with a high potential of starch in a sustainable way. Our sustainable approach of the natural planting allows a harvest of 10-12 tons per hectare. Plantations for high yield would go for 25-30 tons/ha.
Needed are a transport system, a production island, housing for personnel and space for storage. The production will be transported to a nearby harbour to be offered on the world market.
The pilot project is 10.000 ha plus 2.000 for support and production activities.
The production capacity initially is 30.000 ton per year.
The follow up may involve 30.000 hectares out of an area of 90.000 ha. But we may already create miracles with the first 10.000 ha. The pilot project in itself has a growth potential of 300% requiring relative little additional investments.