CPO contaminated in Deli Tama tanks

CPO contaminated in Deli Tama tanks

JAKARTA (JP): Palm oil producers and traders in North Sumatra
have urged the government to act firmly and quickly to stem
fallout from the rejection of 19,000 metric tons of Indonesian
crude palm oil (CPO) at Rotterdam Port last month due to diesel
oil contamination.

"The contaminated CPO originated from PT Deli Tama Indonesia's
storage tanks at the North Sumatra port of Belawan and any
solution to the problem should start there," a major CPO producer
in Medan told The Jakarta Post here on Wednesday.

Another trader in Medan claimed that contamination was limited
to CPO originating from Deli Tama Indonesia's tanks, but the
incident tarnished the image of exporters from the province and
throughout the country.

None of Deli Tama Indonesia's executives in Medan was
available for comment.

However, an official of state-owned PT Sucofindo in Jakarta,
which is in charge of inspecting CPO for acidity and purity,
confirmed that Deli Tama Indonesia tanks were the source of the
contaminated CPO.

The Indonesian Palm Oil Producers Association said on
Wednesday that CPO exports to the Netherlands were suspended over
the shipment of three cargoes of contaminated CPO.

The association added that two scheduled shipments to the
Netherlands from Belawan Port were canceled after the discovery
of a second contaminated cargo in Rotterdam two weeks ago.

The CPO trader from Medan urged the industry and trade
ministry to investigate Deli Tama Indonesia, a subsidiary of
state-owned PTPN III plantation company, to determine how the
contamination occurred.

"MV Paulina, which carried part of the contaminated CPO from
Belawan, also carried CPO from other storage tanks at the port
owned by private companies. But only the cargo pumped from Deli
Tama Indonesia's tanks was contaminated," said the trader who
asked for anonymity.

He said a thorough and immediate investigation into Deli Tama
Indonesia was imperative because all state-owned plantation
companies store their CPO for export or inter-island shipment in
Deli Tama's tanks.

"We are greatly concerned about this incident because
Rotterdam is the center of European palm oil trading and the
gateway to the European common market," he added.

Indonesia, which is projected to produce a total of 5.5
million tons of CPO this year, usually exports between 2.5
million to 3 million tons annually, including about 300,000 tons
to the Netherlands.

According to the Dutch Palm Oil Industry Association, the
19,000 tons of contaminated CPO were found in the cargo of three
ships from Belawan.

The trader said the Indonesian government should ensure
thorough disposal of the contaminated CPO.

"If the contaminated CPO was reshipped to Indonesia, the CPO
market in the country would be contaminated as well. Domestic
cooking oil companies or importers from other countries would
become apprehensive that any CPO they might buy in the next few
months might be the refined product of the contaminated CPO," the
trader added. (vin)