COPRA SHORTAGE SHUTS BIGGEST PAPUA NEW GUINEA MILL

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By Frank Senge Kolma

PORT MORESBY, Papua New Guinea (October 5, 2000 - The National/PINA Nius Online)---Papua New Guinea's largest copra mill closed down last Sunday as the supply dropped well below the mill's daily capacity.

Production at the Toboi Oil mill in East New Britain province was halted because of the low tonnage being received due to the current low world price for copra.

Copra producers throughout the Gazelle Peninsula and nationwide have either completely stopped production or are producing half their normal output as a result of the extreme decline in world prices.

Copra prices this week were at K 247 (US$ 89.66) per ton, considered to be a 10-year low.

Copra prices tumbled this year as a result of oversupply on the world market. Growers had warned earlier that the entire copra industry could collapse as a result of producers stopping production.

A statement from Coconut Products director, Tamzin Wardley, said the Toboi Oil mill operates at 250 metric tons per day and the mill had been receiving only 60 metric tons per day recently.

"The mill is still open to receive copra and when we have sufficient tonnage in stock the mill production will recommence," Ms. Wardley's statement said.

She said on the phone that she expects the mill to reopen its doors again in mid October when there is sufficient stock to meet shipping deadlines in November.

Fortunately for the mill, there are no shipping schedules for October.

Production staff, numbering 140 permanent staff and some 50 casuals, have had to be laid off for the duration of the shutdown.

The mill buys copra from the Copra Marketing Board on an annual contract.

The Copra Marketing Board in turn buys copra from growers throughout the Gazelle Peninsula, New Ireland and North Solomons for the mill.

The mill produces copra oil and stock feed, both of which it sells almost exclusively to overseas customers.

There now remains the Copra Marketing Board's controversial Madang mill.

The Copra Marketing Board has also felt the pinch of the low prices and announced this week that it may move its headquarters out of Port Moresby to either Rabaul or Lae in a bid to maintain operations.

Copra Marketing Board chairman Jerry Nalau said that among cost reduction measures, the board also resolved to defer any further recruitment until copra prices improved.

Other measures included sale of surplus properties in Port Moresby and vehicles throughout all Copra Marketing Board branches.

Mr. Nalau said the long-term viability of the Copra Marketing Board rested on downstream processing of copra, effective research and an immediate replanting program of coconuts to replace most of the existing stock of coconuts, which is more than 80 years old.

For additional reports from The National, go to PACIFIC ISLANDS REPORT News/Information Links: Newspapers/The National (Papua New Guinea).

Pacific Islands News Association (PINA) Website: http://www.pinanius.org 

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