FGV Annual Report 2018

NOTES TO THE FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2018 289 01 02 05 03 07 06 04 08 09 ANNUAL INTEGRATED REPORT 2018 EXAMINED OUR NUMBERS 33 INVENTORIES Group 31.12.2018 RM’000 31.12.2017 RM’000 1.1.2017 RM’000 - Finished goods 1,002,549 1,130,895 886,277 - Raw materials 747,391 732,933 1,134,768 - Work in progress 32,302 78,150 55,058 - Chemicals 33,044 40,971 51,852 - Stores, consumables and replaceable products 247,949 149,354 61,300 2,063,235 2,132,303 2,189,255 34 BIOLOGICAL ASSETS Net book value Oil Palm Group 2018 RM’000 2017 RM’000 At 1 January (Note 62) 54,338 68,831 Transfer to produce stocks (54,338) (68,831) Fair value changes 42,446 54,338 At 31 December 42,446 54,338 Oil Palm Oil palm represents the fresh fruit bunches ( “ FFB ” ) of up to 15 days prior to harvest for use in the Group’s palm product operations. During the financial year ended 31 December 2018, the Group harvested approximately 4,210,173 metric tonnes ( “ MT ” ) of FFB (2017: 4,260,064 MT). The quantity of unharvested FFB of the Group as at 31 December 2018 included in the fair valuation of FFB was 161,716 MT (2017: 133,457 MT). In arriving at the fair value, the Group adopted the income approach which considers the net present value of all directly attributable cash inflows, cash outflows and imputed contributory asset charges where no actual cash flows associated with the use of assets essential to the agricultural activity. Changes to the assumed prices of the FFB and tonnage included in the valuation will have a direct effect on the reported valuation. The Groups biological assets computation is a Level 3 fair value estimation. If the selling prices of FFB or tonnage changed by 10%, the Group’s fair value changes in FFB would have increased or decreased by approximately RM6.31 million (2017: RM7.01 million).