Containerized cargo trends in Cagayan de Oro, MCT reinforce proposed hub system for Mindanao ports
Mike Banos
December 29, 2006
The MCT has been identified as a Mindanao flagship project, one of the key infrastructure envisioned to jump start the island's potential to reality.
For Mindanao to fully realize its full potential as the country's food basket, the cost of transporting agricultural inputs coming in and agro-industrial products going out of Northern Mindanao had to be reduced.
Originally, the MCT was designed to complement the Philippine Ports Authority's (PPA) Cagayan de Oro Base Port in realizing this objective. It was constructed as a key infrastructure component of the Northern Mindanao Medium-Term Regional Development Plan, 2001-2004 and is now operated by the PHIVIDEC Industrial Authority (PIA).
The Cagayan de Oro Base Port (Macabalan) is the busiest and the most congested of the Mindanao's principal ports, having reached 100% berth occupancy rate as early as 1996. PPA statistics show the average annual growth rate from 1995-2002 for cargo, passenger and ship calls are 3.4%, 3.7% and 0.07%, respectively.
As the entry and exit point for the most traded commodities of the four main regions of Mindanao, the Macabalan port was already straining its limits in infrastructure and wanting key ancillary facilities such as quay side gantry cranes, rubber tired gantry cranes, bulk storage and handling facilities, among others, to efficiently meet the rising demand.
Vessel turnaround, especially critical for those transporting grain and fresh produce, was affected. Expansion would have been the logical answer but for key constraints like traffic congestion in the access road, displacement of occupants in expansion areas, and a truck ban by the LGU.
But even at its planning stage, the PPA already opposed the construction of the MCT Phase 1 project, most of which was to be funded by a US$ 85.34 million (PhP 3.24 Billion) soft loan under the Special Yen Loan Package from the Japan Bank for International Cooperation (JBIC).
The Japanese Embassy wanted the lines between the roles of the MCT and Macabalan Port clearly delineated before it approved the facility. The National Economic and Development Authority (NEDA) Cabinet-level Infrastructure Committee (Infracom) pressed PPA to agree to its proposed roles and responsibilities between the two ports : all passenger ships with containerized and/or bulk/grains cargo would be handled by PPA at Macabalan port, while ships with purely containerized and/or bulk/grain cargo would be handled by PIA at the MCT.
But PPA demurred. On 18 December 2002, then PPA General Manager Alfonso Cusi informed PIA it could not enter into a MOA because it would constrain further growth and competitiveness of the Macabalan port.
Cusi said it was inappropriate for PPA and PIA to delineate their respective roles and functions which are already explicitly defined in the charters of both government-owned and controlled corporations (GOCCs).
Moreover, it would be the shipper or cargo owner who would ultimately decide which port to use based on their respective market considerations.
As a GOCC, PPA infrastructure investments are financed by its operations and not the General Appropriation Act (GAA) so NEDA cannot tell it what to do, even if NEDA had a seat in the PPA Board.
As things are turning out, PPA was right all along in adopting this stance, correctly pointing out that port users make the choice on which of the Macabalan or MCT to use based on their actual requirements.
The PIA which manages the MCT says they are now receiving regular port calls from three shipping lines: Maersk-Filipinas, NMC Container Lines and Hamburg-Sud with Lorenzo Container Shipping Corporation soon to join them.
The MCT was conceived to fill the supply gap for an efficient cargo handling facility with its state of the art facilities and cargo handling equipment, It has been designed to be exclusively operated for fully-containerized and semi-containerized domestic and foreign vessels with an annual capacity of 270,000 twenty equivalent units (TEUs) for its Phase 1.
For the nine-month period covering January 1 to September 30, 2006, containerized cargo throughput at the Mindanao Container Terminal (MCT) totaled 24,949.33 TEUs. Taken together, the net throughput of Cagayan de Oro (Macabalan) base port and MCT shows a 5.7% rise in total TEUs of 8,535.33 despite the 11.03% drop (-16,414 TEUs) in containerized cargo at the Macabalan base port.
Domestic and foreign containerized cargo throughputs at both ports likewise reflects this trend: total domestic (inbound/outbound) in Macabalan dropped 10,381.5 TEUs (-7.7%) with foreign (import/export) likewise dipping 6,032.78 TEUs (-42.4%).
However, in both instances, the decreased throughput in Macabalan port was made up for by the MCT: domestic cargo rose to 18,537.32 TEU's resulting to a net gain (less decrease in Macabalan port) of 8.535.33 TEUs (+5.7%) and foreign cargo showing similar gains with 6,412 TEUs resulting to a net gain (less decrease in Macabalan port) of 379.25 TEUs (+2.7%).
Participants to the 3rd Quarter Quarterly Regional Economic Situationer (QRES) hosted by the National Economic and Development Authority (NEDA) Region 10 office earlier this month noted foreign ship calls and trade in the government-owned base ports of Cagayan de Oro, Iligan and Ozamiz have decreased mainly due to Maersk Lines transfer to the MCT and the significant drop in imported dairy products used as raw materials in Nestle Phils. Inc. Cagayan de Oro plant.
A major reason for the transfer of containerized vessels to MCT has been its capability to unload a container van in about 2.5 minutes compared to 10 minutes for an ordinary port. With Oroport's refurbished gantry crane still inoperable almost two years after delivery, this translates to an actual 24 to 9 edge in container handling throughput per hour for MCT. While wharfage fees in MCT are higher than CDO Port, the almost 3:1 edge in cargo handling throughput directly translates to a faster turnaround times and significant savings in overall berthing costs.
Engr. Manuel Jamonir, Infrastructure Specialist with the Growth with Equity in Mindanao (GEM) program, reiterated GEM's advocacy for three hub ports in Mindanao: North (MCT), South (either Davao or Gensan) and West (Zamboanga) in the light of this trend.
"Many share this advocacy," Jamonir said. "We can reduce the cost of shipping through economies of scale. We need the volume that would necessitate the deployment of bigger vessels since consolidation and inter-modal transport are among our key strategies."
For the MCT to get a bigger slice of that pie, Jamonir said PIA has to present the comparative cost in doing inter-modal from various origins in Mindanao.
If volumes from the south (i.e., Davao and Gensan, especially domestic) and from the east (Caraga) are transported through the MCT, the total cost of domestic shipping would definitely come down, Jamonir added.
"This strategy could make Mindanao products very competitive in the domestic market especially in Metro Manila," he said.
Jamonir notes several foreign ships are still docking in the Port of Manila since Mindanao's volume for other foreign destinations is still limited. "We may not be able to avoid trans-shipment to Manila, but with the hub system, we can definitely lower the cost of the domestic component."
INDNJC -
Print
Email
