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DC millers face nutty problem By Quintus
Perera Speaking after
being installed as new president at the association's AGM recently,
Watawala said Sri Lanka was the second largest exporter of desiccated
coconut in the world, with an average market share of 60,000 to
65,000 metric tons per annum but that figure fell sharply last year
to just 30,500 MT resulting in most mills running only for two days
a week. He said that
mills ran into many other difficulties such as labour servicing,
forward contracts and finances and in the process losing foreign
markets. Watawala said
the total edible oil imports to the country is 105,398 MT made up
of Palm Oil 43,791, Palm Kernel 36,452 and Coconut Oil 39,236 MT. He said that
the nuts equivalent of the oil imports would be in the range of
976 million. If no copra was manufactured the total requirement
of oil for a year is 110,964 MT. He said that if no DC was manufactured,
still 83,664 MT has to be imported. Apart from the edible oils,
a total of 48,751 MT of Palm Steering and Tallow had been imported
to the country for industrial purposes. Watawala warned
that the year ahead was also gloomy. The expected crop would be
2.6 billion, consumption 1.8 billion and the balance 0.8 billion.
. The biggest
problem the industry is faced with is to recapture lost markets.
Watawala said that Sri Lanka has been enjoying a 35 percent of the
global market share and if the industry could not adjust itself
to take up the challenge, Indonesia might take over. He stressed
the importance of not only recapturing the market but also looking
for new markets. The SAARC region would be good ground for new markets
where competitors would not be able to creep into. Deputy Minister
of Plantation Industries, Navin Dissanayake said he was aware of
the difficult times DC millers had to undergo in the past as a result
of a shortfall in the crop due to several reasons including inadequate
rainfall for the last two years. Another could be attributed to
the curtailment of cultivation inputs such as fertilizer application
owing to the low farm-gate prices which prevailed in 2,000, caused
by a bumper harvest and ad-hoc policy on import of edible oils. He said that
the estimated coconut production for 2002 was around 20 to 30 percent
less than the annual requirements for household consumption and
industrial processing with the price of a nut for the consumer reached
an all time high of Rs. 19. He said that the government was very
concerned about consumer prices of coconut and thus there was a
strong lobby to import coconuts to meet the consumption and industry. Dissanayake said his ministry has taken various steps to accommodate the crisis such as regular monitoring, adjusting import tariffs on edible oils and copra. A package of assistance was introduced to assist coconut farmers in reviving coconut production with Rs. 185 million allocated from the Coconut Chess Fund last year for this purposes.
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