Shipping company to service Davao-Indonesia route advised to lower rates

DAVAO CITY (MindaNews / 23 Jan) – The Manila-based Reefer Express Line should lower down its shipping cost to entice more traders from both Mindanao and Indonesia to use the Davao-Bitung service, an executive of the Davao City Chamber of Commerce and Industry Inc. (DCCCII) said on Wednesday.

The shipping company plans to deploy a vessel with two trips a month from Davao City to a port in Bitung, Indonesia within the first quarter of 2019. It will not call port in General Santos City due to lack of cargo.

Dr. Maria Lourdes Monteverde, trustee and former DCCCII president, told “Wednesday’s at Habi at Kape” that if the shipping company were to peg the cost at $1,700 or equivalent to P89,624, it will still be costly for traders.

She said it should not go above $1,000.

The Davao-General Santos-Bitung RoRo route was launched on April 30, 2017, to cut down the shipping cost to P34,713 per TEU (twenty-foot equivalent unit) from P109,098 per TEU with the Davao-Manila-Jakarta-Bitung route and the travel time between Mindanao and Indonesia to one to two days from three to five weeks.

The 500-TEU M/V Super Shuttle RoRo 12 had been deployed for the opening carrying only five containers of flour from Aboitiz-owned Pilmico Foods Corp. Its operation halted for lack of cargo.

But Mindanao Development Authority (MinDA) public relations head Adrian Tamayo said the maiden trip was just a “demonstration that it can be done.” The big vessel was replaced by a smaller 256-TEU KM Gloria 28, owned by a Manado-based shipping company, just a few months later.

According to MinDA, the Reefer Express Lines utilizes a 200-TEU conventional vessel that can accommodate both dry and frozen cargos. It plans to expand to Japan next year to bring premium banana exports from Mindanao to the Japanese market.

The route was one of the three pilot areas for RoRo operation selected for Japan International Cooperation Agency’s feasibility study on Establishment of the Association of Southeast Asian Nation (ASEAN) in 2012 when Monteverde was still the DCCCII president. It was finalized in March 2013.

“I don’t know what happened why the cost remains high,” she said.

Monteverde called on governments of Indonesia and the Philippines to provide fuel subsidies and urged traders to consolidate their products to meet the desired volume.

“I just don’t know if it’s really going to be given because that could have impacted or lowered the cost of shipping because we have issues on the fuel right now,” she said.

Monteverde said the Indonesian government has been promoting their products in different areas in Mindanao while the Department of Trade and Industry works on product consolidation and improvement of branding of the local commodities.

“Indonesia is doing a lot of trade activities in Mindanao. They even went as far as Zamboanga just to create awareness of the products that can be traded between two countries,” she said. (Antonio L. Colina IV / MindaNews)