2 days ago
- Business
- Malaysian Reserve
Mieco pegs K-One wood pellet supply at RM100m a year
MIECO Chipboard Bhd's wholly-owned unit, Mieco Manufacturing Sdn Bhd, has estimated that its memorandum of understanding (MoU) with South Korea's K-One Corporation for the long-term supply of wood pellets could generate about RM100 million in annual value.
In a filing to Bursa Malaysia today, the group said the MoU, first announced on Aug 8 2025, sets a yearly minimum supply of 160,000 to 200,000 metric tonnes at a reference selling price of US$110 to US$150 per metric tonne.
Based on these parameters and the prevailing US dollar-ringgit exchange rate, the deal is worth around RM100 million per year.
Mieco had announced on Aug 8 that the five-year MOU will see K-One, a leading wood product importer in Korea, designated as Mieco's primary and preferential distributor for wood pellets in Korea, Japan and other agreed international markets.
The non-binding agreement also allows for possible exclusivity to certain buyers, subject to mutual consent.
The group said the collaboration marks its entry into the biomass fuel market, tapping into growing demand for wood pellets as a renewable energy source.
While the MOU is not expected to have an immediate material impact on earnings or net assets, it is envisaged to contribute positively to the group's future earnings. — TMR
