Subic Freeport gets boost from cargo handlers

MANILA, Philippines - Privately owned cargo handling companies for bulk and break bulk cargo are the real backbone behind the progressive operations at Subic international seaport, resulting in the smooth flow of products and goods to/from Northern and Central Luzon.

“Cargo handling operations at Subic have remained efficient over the years due to our investment in infrastructure and equipment here at the Freeport,” says Mario Lorenzo A. Yapjoco, president of Amerasia International Terminal Services, Inc. (AITSI), one of three major cargo handling firms holding service provider contracts with SBMA.

“We were the first cargo handling company to operate at Subic when the US Navy left in 1992,” says Yapjoco.

AITSI, together with Subic Seaport Terminal Inc. (SSTI), Mega Subic Terminal Services Inc. (MSTSI) and several other small cargo handling firms hold service contracts with SBMA.

These cargo handlers have directly and indirectly contributed to SBMA a total of over P1 billion in the last decade.

“AITSI alone paid SBMA approximately P400 million over the last 15 years representing various fees and charges, including SBMA’s share in AITSI’s revenues from stevedoring and arrastre operations,” Yapjoco said.

In 2009, the cargo handlers surpassed their annual quota, for which achievement the SBMA hosted an appreciation cocktail party in their honor.

“We have been presented by SBMA with various citations, awards and certificates of appreciation on several occasions in recognition of our contribution to SBMA’s repeated achievement of their revenue target goals,” says Yapjoco.

Over the years and with the coming and going of SBMA administrators, the cargo handlers, backed by their years of experience, expertise, integrity and strong reputation in the cargo handling business, slowly developed the seaport infrastructure and cargo handling industry at Subic.

With service contracts renewed annually, the cargo handling companies ventured into investing at Subic, giving rise to modern cargo loading/unloading equipment, bagging, warehousing and other stevedoring and arrastre facilities at Subic.

These investments were made possible by Subic’s incentive package of duty-free importation of capital equipment at the Freeport.

“Our more than P115 million investment over the last 10 years in equipment and facilities enabled us to handle different kinds of break bulk cargo such as rice (in bags), general cargo, live cattle, steel, heavy equipment and project cargo. AITSI is also the preferred stevedoring and arrastre company of more than 41 shipping agencies and consignees, including the National Food Authority (NFA),” opines Yapjoco.

Other AITSI clients include Asian Shipping, Eastern Shipping Lines, Inc., JBA Shipping, MIZZEN Shipping, Royal Cargo Lines, Altis International Trading Inc., Autowide International, Aviva International Brokerage, Inc., Bataan Automotive Corp., among others.

SSTI, which exclusively handles fertilizer cargo, has invested more than P300 million over the last 10 years.

In 2004, SSTI opened a P200-million modern fertilizer terminal facility at Boton Wharf that subsequently benefited farmers in Northern and Central Luzon by reducing the cost of fertilizers. The now busy Boton Wharf used to be one of the most neglected wharves at Subic until SSTI developed it from the ground up, bringing in new equipment.

SSTI’s list of clients include Agrotech Agricultural Products, Soiltech Agricultural Products Corp., Ferex, and Yara Fertilizer (Phils.).

Mega Subic Terminal Services, Inc. (MSTSI), which handles loading/unloading of grains, contributed as much as P900 million in various infrastructure at SBMA.

Complementing MSTSI’s facility is a seven-hectare bulk grain terminal where five silos were built, capable of storing approximately 50,000 metric tons of grains and other agricultural products such as soybeans, wheat and corn. MSTSI is also planning to build an additional seven silos as part of their future development.

In 2007, AITSI was able to ink a 25-year contract with SBMA, prompting AITSI to propose another investment project, worth P90 million, for a new grains warehouse at the Naval Supply Depot compound.

“The confidence building, long-term contract led to higher efficiency of AITSI’s operations,” according to Yapjoco.

“In fact, from 2007 to 2009, AITSI handled an average of more than 80 percent of the break bulk and general cargo tonnage,” he added.

SSTI’s highly efficient operations at Boton Wharf, meanwhile, discharges as much as 5,000 metric tons of fertilizers per day, or approximately 320,000 metric tons annually.

The development of Boton wharf, one of the neglected wharves at Subic, can be attributed solely to the bold risks taken by SSTI which hold exclusive rights to handle fertilizer cargo, guaranteeing SBMA P200 million in remittances and the development of the 412-meter-long Boton wharf.

SSTI has been in operation since 2004, handling more than 108,000 metric tons of cargo just in the first half of 2010. It uses three warehouses that have a combined storage volume of more than 55,000 metric tons.

All the cargo handling firms at Subic employ directly and indirectly almost 2,000 workers.

Subic’s natural harbor may have laid the foundation for the smooth transition from a top-rate US naval base to a bustling international seaport.

But it is the expertise and experience of private sector business, taking advantage of government’s package of incentives, that paved the way for the continuing development of the Subic seaport.