N116b Spent On Importation Of Palm Oil In 2017

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Business News

Wednesday, November 29,2017

Palm oil, hitherto one of Nigeria’s major foreign exchange earners, is still being imported with 450,000 tonnes of crude palm oil valued at N116.3 billion ($323.1 million) imported since the beginning of the year.

Despite the high exchange rate and its price, the shipment was increased by 12 per cent as global price hit $718 per metric ton.

The price of the commodity, which was $663 per metric ton in July, rose to $718 per ton this November based on high demand by indigenous manufacturers.

Domestic production currently stands at 970,000 metric tonnes, while 2.7 million tonnes annually, leaving a deficit of 1.73 million tonnes.

Records from the Nigerian Ports Authority (NPA) revealed that Apapa Bulk Terminal Limited (ABTL) at Lagos Port Complex took delivery of 4,000 tonnes from MV Lady Dahlia, bulk carrier, in the first week of this month, while MV Hamour Endurance is awaiting to discharge about 5,000 tonnes at JosepDam terminal, Tin Can Island Port.

In August this year, three vessels berthed at the Lagos Port Complex and Tin Can with 32,483 tonnes of the commodity.

At ABTL were MV GSW Forward and MV Marios G ships, laden with 16,300 tonnes and 11,483 tonnes respectively. Another ship, MV Theresa Success, investigation showed, has also offloaded 5, 000 tonnes of the product at JosepDam terminal.

Findings also revealed that between January and April this year, 50,010 tonnes of the commodity was shipped to the country.

For instance, according to investigation at the Lagos Port, MV SeaPrice discharged 15,000 tonnes in January; MV Chemtrans Havel, 10,700 tonnes in February; MV Star Ploeg, 16,400 tonnes in March and MV Mid Nature, 8,000 tonnes in April this year.

Following the surge and high demand for palm oil by Nigeria and Ghana this year, a shipping line, CMA CGM in August this year, imposed a new cargo protection service for shipments of the commodity into the country.

The protection service attracted an automatic prepaid surcharge of $10 per container.

It would be recalled that the shipping line noted that the surcharge was a new tailor-made cargo protection service for palm oil shipments exported from Indonesia and Malaysia.

However, the company said all palm oil exporters would be compensated with up to $10,000 in the event of loss or damage of cargo during transportation.

It added that export from Indonesia and Malaysia ports to other Africa countries would attract a prepaid surcharge of $10 per 20 feet container and $10 per 40 feet container.

Nigeria was the largest producer of palm oil in the world with a market share of 43 per cent in the 1960s. But currently, it has a world share of 2.9per cent, with Indonesia leading by 33 million metric tonnes, Malaysia, 19.8 million metric tonnes; Thailand, 2 million; Colombia, 1.108 million metric tons and Nigeria, 970,000 metric tonnes.

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