CNMI-bound cargoes come in trickles

Northern Marianas companies may have been keeping fewer inventories as a result of slow business activities here, manifested by the significant drop in the volume of CNMI-bound cargoes during the first half of the calendar year.

A report obtained from the Department of Commerce quoting statistics from the Commonwealth Ports Authority disclosed a 13 percent decline in the volume of inbound revenue tonnage between January and June 2000.

During the period under review, the ports authority recorded a total of 345,500 revenue inbound tonnage or a quarterly average of 172,750, lower than the average 197,275 revenue tons during the previous year.

Rising fuel costs and the sudden shift in the gasoline consumption by Northern Marianas motorists pulled down the volume of inbound petroleum products to 99,300 tons in the first half of the year from the year ago’s average of 107,900 tons.

Prudent fuel consumption on the islands due to higher pump prices, as well as the closure of too many business establishments in the Northern Marianas may have forced oil companies to lower their inventories here.

The fourth since February this year, oil giants Mobil Oil Mariana Islands and Shell Marianas have recently increased fuel prices, citing rising costs in both global and regional markets.

The drastic decline in inbound petroleum products dragged overall revenue tonnage figures for the first semester of the current calendar year, despite increase in raw apparel and cement stockpiles during the same period.

CNMI-bound cement products rose solidly in the first half of the year at 12,300 tons from the previous year’s average of 9,950 tons, despite the decline in construction activities during the same period in comparison with last year.

The Department of Public Works issued a total of 152 building permits for both commercial and residential structures in the first half of 2000, representing construction activities amounting to $11.7 million.

The number of building permits issued this year is lower from 1999’s 179 permits, but has a higher value from last year’s $10 million primarily because of the significant growth in renovation and construction activities in the residential sector.

Saipan-bound apparel products consigned to several players in the local garment manufacturing sector grew 4.5 percent from 101,700 tons in the first semester of 1999 to more than 106,000 tons during the same period this year.

This, even as garment exports from Saipan to the mainland U.S. have started dropping since the second quarter of last year due to the billion-dollar class action suit filed against CNMI manufacturers and their buyers.

The Saipan Garment Manufacturing Association previously revealed that the industry currently deals with slow business resulting from buyers’ apprehension on placing orders from Saipan garment manufacturers.

Government records indicated that apparel orders from mainland buyers have dropped by as much as 30-40 percent. The reduced orders from mainland buyers has been blamed on the billion-dollar lawsuits filed against Saipan apparel makers in two federal courts in Los Angeles and Saipan, and another in a San Francisco state court

The Saipan garment manufacturing industry has positioned itself to be a significant contributor of direct annual revenues for the government, or nearly 25 percent of all tax earnings, generating close to $40 million annually in direct revenue.