Majuro’s copra processing plant reports more than 900 tons during May, the highest monthly total in several years and a big bump after several months of declining product as the country’s aging shipping fleet has been challenged to collect the copra from dozens of remote islands.
Marshall Islands Shipping Corporation officials said the government’s debt to the company for buying copra is over $250,000 and growing. The government subsidizes the price of copra above world market prices, and provides those subsidies to the Tobolar Copra Processing Authority, which in turn pays the Shipping Corporation for buying the copra.
May’s strong 927.74 tons comes after declining copra tonnage since late last year.
From October 2008 through September 2009, copra tonnage had averaged over 1,600 tons per quarter. But that dropped to 1,409 tons from October to December last year and further dropped to 1,228 tons from January to March this year. April continued the slide, with just 404 tons received by Tobolar.
The problem is that government ships operated the Shipping Corporation are in dire need of dry-dock overhauls but the Shipping Corporation has been told to prepare for budget cuts in the upcoming fiscal year 2011 budget, said the corporation’s chairman Alson Kelen.
“The government has told us to dry-dock the vessels in two years,” said Kelen. “But we’re already three years behind schedule for dry-docking.”
Kelen asked whether, without major overhauls of these ships in the near future, “Will our ships still be floating in two years’ time?”
Government officials have asked Japan to fund two new cargo and passenger vessels. But Kelen pointed out it will take two to four years to complete paperwork, negotiations, designs and construction of new vessels.
In the meantime, keeping the fleet working for the 17,000 outer islanders is essential, he said.
But cuts in funding prevent dry-docking, so vessel maintenance costs and needs increase, which translates into more time in port and less time in service, he said.
“None of our ships meet international standards,” Kelen said. The government’s financial difficulties are also hurting the Shipping Corporation’s ability to buy copra, which is now owed over $250,000 for copra purchases, he said. Kelen said the government-owned company cannot sustain operations without government support.
“Copra makers need to be paid,” he said. “Are we helping them by taking the copra and not paying them for months?”
