Legislator calls for probe of alleged CPO smuggling<\/p>\n
JAKARTA (JP): Legislator Priyo Budi Santoso urged the
\ngovernment yesterday to probe a major palm oil producer, the PT
\nBukit Kapur Reksa Group, for allegedly smuggling crude palm oil
\n(CPO) and its byproducts.<\/p>\n
Priyo, who sits on the House of Representatives Commission V
\n(for industry, mining, trade, manpower) said he had received
\nreports from palm oil producers indicating that Bukit Kapur Reksa
\n(BKR) and its subsidiaries may have smuggled hundreds of
\nthousands of tons of olein, the refined form of CPO, in 1997 and
\nthis year.<\/p>\n
\"Other companies may also have smuggled the commodity but the
\ngovernment can probe this company as a starting point,\" the
\nGolkar legislator told reporters at a discussion organized by the
\nAssociation of Economics Journalists.<\/p>\n
Priyo said he strongly believed smuggling had been on the rise
\ndue to the big difference between the country's controlled
\ndomestic prices and international prices, especially after the
\nrupiah's collapse over the last year.<\/p>\n
Minister of Industry and Trade Rahardi Ramelan promised
\nTuesday to investigate the possible smuggling of palm oil and its
\nderivatives in a bid to secure a sufficient domestic supply of
\ncooking oil.<\/p>\n
In an effort to slow down the export of CPO, the government
\nhas raised export taxes for the commodity -- the main raw
\nmaterial for the production of cooking oil -- to 60 percent from
\n40 percent. Domestic CPO supply, however, has remained low
\ndespite the high export tax, pushing up cooking oil prices to
\nbetween Rp 5,000 and Rp 6,000 per kilogram -- far above the
\ngovernment's reference price of Rp 4,000 per kilogram.<\/p>\n
Priyo said that according to his data, the volume of BKR's
\nolein exports originating from Riau's Dumai Port recorded at
\noverseas ports of destinations was much higher than those
\nrecorded in Dumai.<\/p>\n
The Dumai trade office recorded BKR's exports of olein at only
\n2,417 tons in the first half of the year, but data at various
\nports of destinations, collected by surveyor company Inchcape
\nTesting Services of Malaysia, put BKR's total export shipment at
\n48,346 tons over the same period.<\/p>\n
That means almost 46,000 tons of olein shipped overseas by BKR
\nthrough Dumai Port were not recorded in the Dumai trade office,
\nhe said.<\/p>\n
Inchcape is a Malaysian surveyor company hired by
\ninternational buyers to collect data on CPO and olein trade and
\nshipment for market analysis.<\/p>\n
\"If the export shipments were legal, they should have been
\nrecorded at the Dumai trade office because the exporters had to
\nobtain certificates of origin from the office,\" Inchcape's report
\nsaid.<\/p>\n
BKR's export figures for 1997 also raised questions since its
\nolein exports recorded at the Dumai trade office totaled only
\n3,199 tons.<\/p>\n
However, Inchcape's data gathered at ports of destinations in
\nAsia and Europe put BKR's olein exports for that year at a total
\nof 310,900 tons -- more than 307,000 tons over the volume
\nrecorded by the Dumai trade office.<\/p>\n
Priyo believed the company may have colluded with Dumai Port
\nofficials, tax and excise officials and industry and trade
\nofficials.<\/p>\n
\"The government should also probe these people,\" he said.<\/p>\n
Priyo did not rule out the likelihood that the company could
\nhave smuggled the commodity by transferring loads to other ships
\nat sea.<\/p>\n
BKR and its subsidiaries -- PT Karya Prajona Nelayan, PT Sinar
\nAlam Permai and PT Multimas Nabati Asahan -- own palm oil
\nrefineries in Dumai, Kuala Tanjung in North Sumatra and Palembang
\nin South Sumatra with a combined capacity of 6,000 tons per day.<\/p>\n
Another speaker at the discussion, Tarmidzi Rangkuti, the
\ndeputy chairman of the Indonesian Vegetable Oil and Fat
\nAssociation (Famni), agreed that the smuggling of CPO and its by-
\nproducts had been on the rise following the rupiah's collapse. He
\ndid not comment on Priyo's suspicion toward BKR, however.<\/p>\n
\"Pak Priyo's allegations about rampant smuggling is not
\nnonsense,\" Tarmidzi said.<\/p>\n
Derom Bangun, vice chairman of the Association of Indonesian
\nPalm Oil Producers (Gapki), had earlier called on the government
\nto probe possible smuggling. (jsk)<\/p>",
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