New shipping route to spur Ph-Indo trade

The opening of the Davao City-General Santos-Bitung, Indonesia shipping route is expected to further enhance trading between the Philippines and Indonesia, according to the Department of Trade and Industry (DTI).

A Roll-on Roll-off (RoRo) ferry service will begin plying the shipping route on April 28, 2017 and will provide a faster and cheaper channel of trading goods among key cities in the Brunei Darussalam, Indonesia, Malaysia, the PhilippineEast ASEAN Growth Area (BIMP-EAGA).

M/V Super Shuttle RoRo 14, operated by the Asian Marine Transport Corporation will provide a weekly shipping service to the route with a vessel capacity of 100 Twenty Foot Equivalent Units (TEUs).

“These developments in the sub-region complement the ongoing regional efforts towards realizing the ASEAN Economic Community 2025. It will help increase economic cooperation and will pave way for the promotion of Philippine products especially those coming from the Mindanao region,” said DTI Industry Promotion Group Undersecretary Nora K. Terrado.

In a report submitted by DTI’s Trade and Investment Center in Jakarta, the opening of the route is a more cost and time-efficient alternative to the usual Manila to Jakarta to Bitung route, which would take about three to five weeks of shipping time. In contrast, direct shipping through the Davao-GenSan-Bitung route will take only one day and a half of sailing (excluding port stay).

A savings of up to $1,500 (P74,000) per TEU is estimated in using this route given its $700 (P34,713) per TEU rate per 20 feet dry container as compared to using the Davao-General Santos to Manila to Manado via Jakarta route which amounts to $2,200 (P109,098) per TEU.

Among the goods identified by the private sector in Mindanao at this stage that will be shipped to Indonesia are: animal feeds, fertilizer, construction materials, ice cream products, poultry (halal), fresh fruits, and synthetics.

Initial list of import goods on the other hand include matured coconut, copra, corn, feed ingredients, lumber, cement, high value crops, vegetables, meat, peanuts, aqua products, charcoal, soya, coffee beans, and sugar.

In a feasibility study conducted by the Japan International Cooperation in 2012, the GensanBitung route was selected as one of the pilot areas for a roll-on roll-off operation within BIMP-EAGA. The study also highlighted that the route can be dedicated to a freight service once shipping service requirements are in place. DTI-IPG