San Miguel Corp. is mulling over plans to acquire six new Panamax cargo vessels, each worth around $50 million, to meet the growing shipping requirements of food unit San Miguel Pure Foods Co. Inc.
According to SMC president and Purefoods vice chair Ramon S. Ang, Purefoods’ thrust for this year is to jack up volumes by a double-digit rate, increase market share and improve operating efficiency.
Through San Miguel Shipping and Lighterage, the group is studying the acquisition of Panamax vessels, each with a payload capacity of up to 85,000 tons to transport Purefoods’ commodity requirements from the United States, like wheat and soya.
“We’ll save a lot even if it’s just for in-house use,” Ang told reporters at the sidelines of the company’s stockholders meeting on Friday.
He estimated Purefoods’ current freight cost at $13 per metric ton. If Purefoods were to have its own cargo fleet, he said, cost could go down by $3 to $5 per metric ton.
Taking into account Purefoods’ annual consumption of about 2 million tons of wheat and soya imports, the acquisition of the vessels could translate to savings of about $10 million a year, he said.
“These are the optimization measures we’re studying, but we haven’t pursued yet,” Ang said.
Overall, Ang is confident about Purefoods’ prospects for 2014.
“The food company will continue its momentum because its foundation is good. Instead of relying on wet market, consumers are (buying more) ready to eat (products), so prices are stabilizing,” he said.
On SMC’s first quarter results, Ang described it to be “good,” citing a double-digit year-on-year improvement in revenues and net profit. Doris C. Dumlao