02 November 2014

Subic Freeport now San Miguel Brewery’s alternative gateway

San Miguel Brewery, Inc. (SMB), a subsidiary of conglomerate San Miguel Corp., recently shifted a substantial volume of shipments from the port of Manila to Subic, a move that has meant less shipping fees and greater availability of stocks.

Due to the adverse effects of port congestion triggered by the Manila truck ban, Subic port provided a “new gateway” for SMB shipments, according to the company’s procurement manager, Gary Algodon, during a presentation at the Northern Luzon Shipping Summit in Fontana Clark on September 29.

Starting in June, Algodon said “Subic Port provided a new gateway for our shipments to the City of San Fernando, Pampanga, which accounts for 70% of container volumes (of SMB) in Luzon.” The shift was designed to “rectify delays” due to the Manila port congestion; as a result the company experienced availability of stocks for the next three months, he said.

The brewery in Pampanga is also nearer Subic port at 66.2 kilometers away compared with Manila International Container Port’s distance of 76.3 kms.

Further explaining the shift, Algodon said vessels calling Subic port are “basically on time, thus providing us the necessary stocks security.”

He added, “Through Subic Port, SMB was able to increase the inventory level of our raw materials to manage the uncertainties of the Manila port.”

Servicing of trucks is also faster through the Northern Luzon facility, he said.

It was only relatively recently that SMB shipped out of Subic port because “Manila port then was viable in terms of total landed cost”, Algodon said.

Since the implementation of the Manila truck ban in February and before the shipping shift to Subic, SMB encountered a lot of fees they were “not used to paying”, including demurrage and storage, which had reached P600,000, Algodon said.

It must be noted though that Manila mayor Joseph Estrada has lifted indefinitely the truck ban on Sept 13 although its effects, according to transport stakeholders, are expected to linger until early next year.

Since June, SMB has transported 447 containers out of Subic port. The company likewise plans to ship from Southeast Asia and Europe through the Northern Luzon gateway.

Algodon said Subic port has also become SMB’s “alternative port” for shipments bound to its Polo, Valenzuela brewery. Subic port and its Valenzuela brewery are 124 kms apart or a two- to three-hour trip.

Algodon said that with the lifting of the Manila truck ban and government’s efforts to decongest Manila ports, Algodon said they hope this would lessen costs incurred by its Valenzuela brewery.

“I think Subic port is becoming a new gateway,” Algodon noted, adding that SMB shipping through Subic means “there is no more danger in the stock out of beer.” (Roumina Pablo, PortCalls)