Cover Story
Copra Industry's Big Comeback
Samoa chosen as regional milling centre
Samoa is the location chosen by Australian and New Zealand business interests to become the South Pacific’s regional copra milling centre.
Elan Trading, led by a South Australian businessman, Don Fleming, secured a 25-year lease of a government-owned mill at Vaitele, near Apia, and commissioned the refurbished facility in July.
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“We’ve so far invested S$4 million in improving it,” general manager, Rex Evans told Islands Business. “We’re not here for the short-haul.”
Evans says the company plans to buy copra from Tonga and the Solomon Islands and possibly from the Cook Islands, Fiji and other sources to supplement Samoan supplies that are insufficient to meet the mill’s full milling capacity.
“What we are doing now is establishing an oil extraction group which will bring more economic stability to the business and give farmers continuity of demand.”
Elan has a copra mill at Santo, Vanuatu, which Evans says is now running at full capacity after overcoming start-up difficulties caused by corrupt local officials. “There was absolutely no credibility there,” he says.
Elan, which has a background of property development, operates a grape seed mill in South Australia. Fleming is its principal owner with a New Zealand businessman, David Wong Tung, as an associate in the Samoan venture. The Samoa mill has a chequered management history and had ceased production at the time Elan moved in last year to run it as Coconut Oil Products Samoa (COPS).
The company has installed advanced computer controlled drying equipment and is preparing to install additional milling capacity.
“By the end of next year we should be producing about 300 tonnes of oil a week, which will need 550 tonnes of copra. That is our target, but it may take us longer.”
Evans says that years of decline have reduced coconut plantations in Samoa into a deteriorating state. Elan was in discussion with the government about the revitalisation of the plantations. “We are prepared to chip in to ensure that planting goes ahead.
“We are very confident about the industry and its long-term viability.”
The government has become disenchanted with it “due to excuses made by characters they allowed to use the place (mill). It has a history of people not doing the right thing.”
In the Solomon Islands where the industry has been crippled by the repercussions of political unrest and a civil war, the company has applied for a copra buying licence, engaged agents and organised shipping. “There is an absolute social necessity there (for the restoration of the copra trade). They are in a terrible state of affairs.”
Agents had been appointed in Tonga also. “We hope to buy up to 10,000 tonnes a year in very, very good years.”
The Cook Islands was another prospective buyer. But high wage rates at New Zealand levels meant that some mechanisation would be needed. Elan is engaged in the improvement of technology of machinery for copra cutting and extraction.
The COPS mills are exporting oil and coconut cake to Australia and New Zealand. Evans says he has ideas about coconut by-products. “I have an order for 4000 tonnes of one product a year, but I can’t at this stage tell you what it is. It’s too sensitive.”
Samoa used to produce more than 20,000 tonnes of copra a year. It exports oil, cake, and coconut cream worth S$4.55 million in 1999. In that year coconut products contributed more than one-fifth of the value of all domestic exports.
Papua New Guinea has two copra mills, Fiji and Vanuatu one each, and an Australian investor is involved with a mill planned in Kiribati. A small Solomon Islands mill is currently out of production. In French Polynesia, Evans says a mill is being strangled by lack of local copra production.
