Wilmar Pays 60% of 2024 Profit as Indonesia Security Deposit

Wilmar International, a prominent Singapore-based agrifood conglomerate, has transferred 11.9 trillion Indonesian rupiah ($729 million) to Indonesia as a "security deposit" in response to allegations of misconduct related to palm oil export permits. This amount represents approximately 60% of Wilmar's annual profit of $1.2 billion for 2024, highlighting the significant financial impact of the case. The company generated $67.4 billion in revenue last year, marking a 0.3% year-on-year increase.

The allegations stem from accusations by Indonesian prosecutors that Wilmar bribed officials to secure the permits in 2022, during a period of national cooking oil shortage. Although an Indonesian court acquitted Wilmar and two other companies in March, the three judges involved in the ruling were subsequently arrested on graft charges a month later. The Attorney General’s Office of Indonesia asserts that the corruption surrounding these export permits resulted in a loss of 12.3 trillion rupiah ($755 million) to the state.

Wilmar has maintained its stance, asserting that all actions taken during the export of cooking oil were in compliance with prevailing regulations. The company stands to regain the "security deposit" if Indonesia’s Supreme Court upholds the acquittal. Conversely, Wilmar will forfeit the funds if it loses the case. A senior official from Indonesia’s Attorney General’s Office stated at a press conference that Wilmar's payment is intended to cover the state losses they allegedly caused.

Indonesia is a critical player in the global palm oil market, accounting for about 60% of the world's supply. Crude palm oil is a key ingredient in numerous food products and household goods. In response to a cooking oil shortage in late 2021 and early 2022, Indonesia implemented strict export restrictions on palm oil, including a three-week-long export ban, to ensure local supply and control rising prices.

Wilmar is one of the world's largest owners of oil palm plantations, with a total planted area exceeding 230,000 hectares. The company is a major player in the region, ranked No. 4 on Fortune’s Southeast Asia 500 and is one of the few companies in the region to be included in the Global 500, Fortune’s ranking of the world’s largest companies by revenue. Two-thirds of Wilmar’s oil palm plantations are located in Indonesia, and the company produces a variety of food products, including rice, noodles, and margarine, for global markets.