Coconut milked

Almost five months in power, the motor-biking Duterte Harley could still be lost on the controversial coconut levy fund of at least P100 billion.

He could expect to be swamped with protests from various groups, supposedly made up of “coconut farmers,” growing more restless by the day.

Perhaps adding to the emotions would be the alleged inaction of his administration on the deteriorating businesses that earlier used the fund. Among them would be the five coconut oil mills in the Coconut Industry Investment Fund, tagged by media as the CIFF OMG.

From what I gathered, farmer groups were seething in anger over this sweetheart deal given by the CIIF OMG to this favorite private company.
Long engaged in biodiesel and specialty fats, the company got a supposed lucrative contract from CIIF OMG to use an oil mill in Batangas.

The CIIF OMG already resorted to renting out its mills, instead of running them, during the Aquino (Part II) administration.

At that time, management of the oil mills was led by the man whose main qualification was being the “best man” of a Cabinet member.

By the way, the emerging media-favorite NPC (nonperforming classmate) in the Duterte administration would seem to be Transportation Secretary Arturo Tugade.

To begin with, Tugade already created quite a stir when he appointed a DOTr undersecretary for rail before anything else. Yet, the DOTr did not really achieve anything much for the riding customers of the light rail systems in Metro Manila for the past five months.

This early, Tugade was the only classmate or dorm mate or town mate of Duterte Harley who already earned the ire of members of Congress.
The Commission on Appointments just bypassed him.

Lawmakers also crossed political lines to attack him on the vast emergency powers that he wanted purportedly to solve the traffic problem.

While the lawmakers noted that the problem was concentrated in Metro Manila, Metro Cebu and Davao City, Tugade allegedly wanted to award P8 trillion worth of contracts nationwide without following the rules.

The Pinoy Gumising Ka Movement even alleged that Tugade entered into questionable deals as head of the Clark Development Corp. in the 1990s.

Not just a few also found funny his plan to install cable cars over the entire Laguna de Bay purportedly as “mass transport.”

But back to the CIIF OMG, because it was short on cash and could not buy copra directly from farmers, its oil mills became idle.

It even had to rent out its mill in Davao to the MVP group under a P100-million yearly “lease” that sounded in the industry as a real good deal.
It meant that whether or not the MVP group made a killing or lost its pants in the venture, it would have to fork out P100 million a year.

But the deal on the Batangas oil mill was different: It was just a “tolling” arrangement, meaning the CIIF OMG would only charge the lucky company a fixed fee, based on the quantity of copra that it would process.

“Tolling” is much cheaper than “lease,” allowing every Tom, Dick and Harry named Dean to use an oil mill without putting up a single centavo in capital.

Surprise! The lucky company actually got “exclusive” use of the mill, and the bright CIIF OMG gave up its income from the other users.

From what I gathered, the farmer groups have already questioned why CIIF OMG no longer operates its mills.

Originally, the CIIF OMG was supposed to buy copra directly from farmers to foil the traders in manipulating prices.
Under the Aquino (Part II) administration, the CIIF OMG suddenly mothballed the mills.

And nobody would know how much the CIIF OMG earned from the “exclusive” tolling deal with the local company.

Sometime ago, a Malaysian company also offered to CIIF OMG whatever deal it would choose to operate the Batangas mill, whether lease or toll or revenue sharing.

After the CIIF OMG threw out the proposal, the Malaysian company still informed the CIIF OMG that it would take part in any future public bidding for the mill.

Well, there was no bidding whatsoever.