MARKET DEVELOPMENT
Cheap Imports Will Drown Local Investments, Palm Oil Producers Warn
Cheap Imports Will Drown Local Investments, Palm Oil Producers Warn
11/05/2013 (The Guardian Nigeria) - Local investors in palm oil production and processing have complained that cheap importation of palm oil will kill local industries, cripple the agricultural transformation agenda of the federal government and turn Nigeria into a dumping ground for imported palm oil unless something urgent and drastic is done.
Representatives of key associations within the oil palm value chain made these unsettling disclosures in Abuja recently in a meeting with the leader of the oil palm transformation team, Dr. Dickson Okolo.
Together, they reviewed the oil palm industry under the current West African sub-regional trade regimes and concluded that neighbouring countries are being used as cover-up as sources of the imported palm oil.
The national chairman of Oil Palm Growers Association of Nigeria (OPGAN), Igwe Hilary Uche, accused Nigerian collaborators of ‘driving’ the importation initiatives in collaboration with their foreign counterparts.
The OPGAN chairman lamented that local producers are the worst victims. He expressed confidence in that Nigeria has all the required resources to produce palm oil for local consumption.
The groups, in unison, expressed dissatisfaction with PZ Wilmar, a company they accused of trading duty-free Crude Palm Oil (CPO) in Nigeria.
Mr. Fatai Afolabi, representing the Plantation Owners Forum of Nigeria (POFON), noted rather with dismay that, for the past 10 years, some Nigerians have been working with some Asians, and in particular, Malaysians investors to “sabotage our local efforts to grow the oil palm industry.”
Wilmar International, Afolabi said, is the largest plantation owner in Malaysia and Indonesia and this is the company that now partners with PZ, its Nigerian ‘trade agent,’ to form PZ Wilmar, working to sell Wilmar’s CPO in Nigeria.
He was specific that PZ has established a refinery in Ikorodu, Lagos, “without due regard to the fact that there are no major plantations around to supply its raw materials, which is indeed a ploy for massive import of duty-free and cheap CPO from Malaysia under ECOWAS Trade Liberalisation Scheme (ETLS).”
Afolabi did not spare the Manufacturers’ Association of Nigeria (MAN) for what he described as “working to achieve policy changes in favour of PZ Wilmar” and MAN’s position in “the past,” which did not favour local plantation developers and processors, such as pursuing downward review of CET from 35 per cent to five per cent in 2012.
He frowned at what he described as ‘unacceptable proposal from MAN that any plantation owner that has up to 200 hectares and above should be given a concession to import CPO at zero tariff while some companies are “serving as pipelines to pump CPO from Malaysia and Indonesia to Nigeria.”
Afolabi recalled the refusal by the federal government, in 2000/2001, of a proposal to set up tank farms in our major ports. These tank farms, he said, have been established in other West African countries from where cheap and duty-free CPO is imported under ETLS.
He said available reports show that the West African countries exporting palm oil to Nigeria were themselves net importers of the products and were unjustly trading against Nigeria.
Okey Ikoro, chairman of the Vegetable/ Edible Oil Producers’ Association of Nigeria (VEOPAN), presented a grim outlook as he said, “many processors are taking inventory of their stock as a result of the fact that they produce and can no longer refine as there is no market to sell.”
He said the customers now prefer to go to the ports and borders to buy cheap CPO.
Ikoro underscored the hopelessness of the situation by pointing out that there are cases of alteration of the documents relating to ‘country of origin’ and that “products such as vegetable oil under prohibition were being freely brought into the country” just as “multipurpose ship not meant to transport CPO now brings it into the country, and even though NAFDAC has complained in the past, the practice persisted.”
He accused MAN for decisions which are “now in conflict with what the local operators are demanding for the industry.”
Representatives of key associations within the oil palm value chain made these unsettling disclosures in Abuja recently in a meeting with the leader of the oil palm transformation team, Dr. Dickson Okolo.
Together, they reviewed the oil palm industry under the current West African sub-regional trade regimes and concluded that neighbouring countries are being used as cover-up as sources of the imported palm oil.
The national chairman of Oil Palm Growers Association of Nigeria (OPGAN), Igwe Hilary Uche, accused Nigerian collaborators of ‘driving’ the importation initiatives in collaboration with their foreign counterparts.
The OPGAN chairman lamented that local producers are the worst victims. He expressed confidence in that Nigeria has all the required resources to produce palm oil for local consumption.
The groups, in unison, expressed dissatisfaction with PZ Wilmar, a company they accused of trading duty-free Crude Palm Oil (CPO) in Nigeria.
Mr. Fatai Afolabi, representing the Plantation Owners Forum of Nigeria (POFON), noted rather with dismay that, for the past 10 years, some Nigerians have been working with some Asians, and in particular, Malaysians investors to “sabotage our local efforts to grow the oil palm industry.”
Wilmar International, Afolabi said, is the largest plantation owner in Malaysia and Indonesia and this is the company that now partners with PZ, its Nigerian ‘trade agent,’ to form PZ Wilmar, working to sell Wilmar’s CPO in Nigeria.
He was specific that PZ has established a refinery in Ikorodu, Lagos, “without due regard to the fact that there are no major plantations around to supply its raw materials, which is indeed a ploy for massive import of duty-free and cheap CPO from Malaysia under ECOWAS Trade Liberalisation Scheme (ETLS).”
Afolabi did not spare the Manufacturers’ Association of Nigeria (MAN) for what he described as “working to achieve policy changes in favour of PZ Wilmar” and MAN’s position in “the past,” which did not favour local plantation developers and processors, such as pursuing downward review of CET from 35 per cent to five per cent in 2012.
He frowned at what he described as ‘unacceptable proposal from MAN that any plantation owner that has up to 200 hectares and above should be given a concession to import CPO at zero tariff while some companies are “serving as pipelines to pump CPO from Malaysia and Indonesia to Nigeria.”
Afolabi recalled the refusal by the federal government, in 2000/2001, of a proposal to set up tank farms in our major ports. These tank farms, he said, have been established in other West African countries from where cheap and duty-free CPO is imported under ETLS.
He said available reports show that the West African countries exporting palm oil to Nigeria were themselves net importers of the products and were unjustly trading against Nigeria.
Okey Ikoro, chairman of the Vegetable/ Edible Oil Producers’ Association of Nigeria (VEOPAN), presented a grim outlook as he said, “many processors are taking inventory of their stock as a result of the fact that they produce and can no longer refine as there is no market to sell.”
He said the customers now prefer to go to the ports and borders to buy cheap CPO.
Ikoro underscored the hopelessness of the situation by pointing out that there are cases of alteration of the documents relating to ‘country of origin’ and that “products such as vegetable oil under prohibition were being freely brought into the country” just as “multipurpose ship not meant to transport CPO now brings it into the country, and even though NAFDAC has complained in the past, the practice persisted.”
He accused MAN for decisions which are “now in conflict with what the local operators are demanding for the industry.”