IOI Corp partners Singapore’s Mega Star to build RM100m sustainable coconut mill in Johor

IOI Corp Bhd has teamed up with Singapore-based Mega Star Holding Pte Ltd to develop Malaysia's first integrated and sustainable coconut mill complex in Segamat, Johor, with an estimated investment of RM100 million.

Mega Star, affiliated with China's Ting Hsin International Group, brings extensive food and beverage market access across China and Taiwan. 

The joint venture aims to combine IOI's global expertise in the edible oil sector with Mega Star's distribution network to expand their coconut-based product portfolio.

Under the partnership, IOI will offtake and market coconut oil to its associate companies and customers in the European Union and the US, while Mega Star will handle the marketing of concentrated coconut water in China and Northeast Asia.

Scheduled for completion in the fourth quarter of 2027, the Segamat complex will initially process 100,000 coconuts per day, with plans to scale up to 300,000 coconuts daily as IOI's plantations mature and expand to about 5,000 hectares. 

Located near IOI's Johor plantation landbank and the Inland Port of Segamat, the site will benefit from efficient raw material supply and logistics. 

The high-tech complex will employ robotic and IR 4.0 processing systems, alongside a self-generating bioenergy system using coconut husks as fuel.

IOI also plans to convert coconut shells into activate carbon, reinforcing its circular economy strategy.

IOI Group MD and CEO Datuk Lee Yeow Chor said the venture marks a "significant milestone" in diversifying into the coconut segment. 

"By combining IOI's operational excellence and access to the international edible oil market with Mega Star's strong market access to the food and beverage sector in China, we aim to deliver high-quality and sustainable coconut products to meet growing market demand," he said.

Mega Star Executive Director CM Wei said the collaboration underscores both parties' shared commitment to innovation and sustainability.

"Through this collaboration, we demonstrate our shared commitment to driving innovation and building a green and sustainable value chain," he said.