Cover Report
Copra Producers Wallow In Strife
Political interference to be blamed
The fate of copra producers is to be tied to the highs and lows of world copra prices. The dried meat of the coconut, crushed for oil, remains the primary cash earner for the grassroots people who are 80 percent of Vanuatu's population.
In good times their annual output exceeds 40,000 tons. In recent years it has taken a plunge due to a combination of factors including poor world prices, hurricane damage and ageing palm trees, and the now receding boom market for the vastly more profitable kava.
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Last year's copra exports were down to 7339 tons compared with 30,434 in 2000. But the seeming slump was caused by the diversion of copra to a new mill opened two years ago by an Australian-controlled company, Coconut Oil Products Vanuatu Ltd (COPV).
Last year, COPV produced 5329 tons of coconut oil and it expects to do much better this year with the evaporation of supply problems caused by competition for copra from a now departed rival Australian buyer.
Yet this key industry still wallows in strife caused largely by political influence affecting the Vanuatu Commodities Marketing Board (VCMB), a government agency with a monopoly on copra and cocoa exports. Private exporters can't operate without a licence from the board.
When world prices fell in 2001, the board, under political pressure, raised local buying prices so that it was losing about 6000 Vatu (US$45) a ton.
Copra production rose sharply but to maintain the prices the board borrowed heavily.
According to the board's newly appointed chairman, Gilbert Norman, who is a political officer to the trade minister, VCMB is now saddled with a 400 million Vatu (US$2.96 million) debt, including 270 million vatu owed to the Reserve Bank and 130 million vatu owed to local Chinese traders and shippers.
Norman expects the board to be able to work its way out of its debt in time. But meanwhile commercial buyers will need to carry the burden of keeping the local market alive.
The former board spent hundreds of thousands of dollars on what the trade says was an unnecessary shift of headquarters from Port Vila to Santo, including moving "compensation" for some officials.
The former chairman, who has just appeared as head of a new copra and cocoa buying company, last month was convicted of stealing cocoa.
Vanuatu's coconut groves need replanting to replace old trees that are past their prime, while producers need help in replacing hot air driers, essential for making first grade copra, but which are wearing out.
At Santo, Stanley Temakon, manager of the COPV mill, says the company plans to assist replanting and drier replacement efforts by contributing to a copra development fund.
The mill has a 36,000 to 37,000 ton crushing capacity, he says. Since the VCMB new directors have had to slash the support price copra output has fallen and the local supply is running at around 300 to 400 tons a week.
The company has established a buying agency in the neighbouring Solomon Islands, where it has begun buying for shipment to Santo in 500 to 600-ton consignments.
