McLeod expects biofuel project to bear fruit in a year

Kolkata, May 31 (IANS) The world’s largest tea producer McLeod Russel India Limited expects its investment in D1 Williamson Magor Biofuel Ltd to start bearing fruit within the next one year when the first crop is expected, a top company official said here.

D1 Williamson Magor Biofuel Ltd is a 50:50 joint venture between group company Williamson Magor & Co Ltd and D1 Oil Plc of Britain.

‘We have been approached by several companies owning refineries that have offered to buy the seeds while we may also tie-up with any public sector oil marketing company,’ company’s managing director Aditya Khaitan told reporters at a press conference.

McLeod would invest Rs.50 crore in the project out of which Rs.27 crore has already been invested as loans.

‘There are apprehensions in some quarters that average tea prices would drop in 2010-11 from last year’s level but my reading is that we would see a higher price as crop shortage is only going to go up,’ Khaitan said.

He expects shortage in the industry to go up from 60 million kg in the beginning of April to 80 million kg by the beginning of the next tea season starting April 2011.

McLeod Russel acquired Williamson Tea Assam Ltd from London-based Magors in 2005, in December 2005. It bought Hindustan Lever Ltd’s entire stake in Doomdooma Tea Company and Moran Holdings Plc of the Britain in 2007.

Mcleod Russel through its wholly-owned unit, Borelli Tea Holdings Ltd, Britain, acquired Phu Ben Tea Company Ltd, Vietnam in 2009. In the same year, it acquired six tea gardens in Uganda.

The company posted a loss in January-March quarter of Rs.120 crore up from a loss of Rs.88.61 crore a year ago due to higher tax outgo.

Khaitan expected McLeod’s output to reach 102 million kg in 2010-11 up from 81.70 million kg in 2009-10. ‘Our overseas gardens are expected to add 22 million kg in the current year,’ he said.

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