3/8/06 KARACHI (Business Rocorder): Palm oil supply to upcountry refineries has halted completely for the last 5/6 days and the edible oil producers of the country are in a fix as two big contractors associations which supply imported palm oil from Karachi port to upcountry destinations are locked horns with each other, sources told Business Recorder on Wednesday.

Sources said that the two big imported palm oil transporters-the All Pakistan Oil Tankers Owners Associations (edible oil transporters) and Edible Oil Contractors Association have completely suspended their operations following a tussle which cropped up between them on certain domestic issues.

"We can not work too much for less salaries and under unnecessary strict vigilance," said an office-bearer of All Pakistan Oil Tankers Owners Associations (edible oil).

He alleged that the Edible Oil Contractors Association was holding back No Objection Certificates (NoC) of heavy vehicles' drivers, adding that the said association had resorted to hooliganism and compelled the drivers to work for longer hours.

"We wanted to get ourselves separated with the contractors association and intended to make direct contracts with the oil refineries, which the contractors simply dislike," the office-bearer said.

He said that there are 120 big contractors who possess 3,000 heavy vehicles for edible oil transportation and they have been enjoying market monopoly since long. Contrary to that, the supply of imported palm oil is suspended to the small and big refineries of the country (even in Karachi) and the refiners have are facing losses of around Rs 50.4 million since Friday last.

"They (transporters and contractors) have also closed down edible oil terminals at Kaemari and Port Qasim," said an owner of an edible oil refinery at Port Qasim.

He pointed out that the palm oil supply to refineries of SITE, Port Qasim and Korangi has been halted since Friday last and due to non-availability of transportation facility, the operations of edible oil refineries in the country have come to a standstill.

"Actually, we daily lift our imported commodity from the port after paying duties and we can not operate our plants without raw material," he remarked. Industry sources said that around 2,500 tons to 3,000 tons of imported palm oil is lifted by the transporters from the port and since the country mainly depends on imported commodity, the ongoing edible oil crisis could further aggravate with this new issue.

Palm oil is used by the refineries as raw material, which process it and finally dispatch their production to the markets. "The demand and supply mechanism is not stable and this could further worsen the ongoing crisis because the middlemen could take advantage of the situation and raise the edible oil prices," a refinery owner mentioned.

He demanded of the officials concerned to take cognisance of the matter and intervene immediately to resolve the rift between the two associations as it could put a negative impact on cooking oil prices during Ramazan.