Meeting on palm oil exporters' transport woes

Business Times - 13 February 2001LOCAL palm oil exporters are banking on the Transport Ministry's supportto persuade Malaysia International Shipping Corp (MISC) to agree todedicating a certain number of bulk tankers to transporting palm oil.

The exporters, who are facing difficulty hiring tankers to make committeddeliveries of the commodity, have called for an industry meeting tomorrow.

It will be attended by officials from the ministry, MISC, MalaysianShipowners Association, Malaysian Palm Oil Board, Palm Oil RefinersAssociation of Malaysia, and the Malaysian Palm Oil Association (MPOA).

"We will meet the ministry's maritime division officials to try to find asolution to the problem," MPOA chief executive M.R. Chandran told BusinessTimes in Kuala Lumpur yesterday.

Chandran claimed that tankers favour transporting petroleum productsbecause it is more lucrative, given that the shipping rate is US$60 (US$1= RM3.80) per tonne compared to only US$40 for palm oil products.

In addition, it is believed MISC, being part of national oil corporationPetronas, gives priority to shipping crude oil, liquefied natural gas andrelated products.

Chandran said palm oil exporters are facing a shipment backlog of between200,000 tonnes and 300,000 tonnes of palm oil from Sabah and Sarawak tothe Peninsula as well as overseas destinations such as India, Pakistan andthe European Union.

"We need 25 to 30 bulk tankers with a carrying capacity of 8,000 tonneseach if we are to clear the backlog," he said.

Chandran said small tanker operators like Felda-owned Petrajaya, which has15 bulk tankers, cannot handle the huge shipments involved.

"Only MISC can help the industry as it has a big fleet.

"The size of the tankers is also an issue when it comes to transportingpalm oil from Sabah to the Peninsula, because the larger ones can onlydock at Lahad Datu, and not Sandakan and Tawau.

"The industry will be wasting money if unsuitable ships are used," hesaid.