HomeGeneral NewsBenchmark Value Discount implementation forces Wilmar Africa to shut down oil production...

Benchmark Value Discount implementation forces Wilmar Africa to shut down oil production plant

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managing director of Wilmar Africa Limited, Mr Kwame A. B. Wiafe

Wilmar Africa Limited, producers of Frytol Vegetable Oil and Fortune Rice, has announced the imminent closure of its oil production division over operational challenges.

According to the company, its misery began in 2019 following the government’s introduction of duty discount on benchmark value policy.

The policy, it explained, made it difficult for it to compete with imported products from Asia which are way cheaper.

“There has been a huge increase in cheap imported products into the country. This has made it difficult for us to sell in the local market because imported oils from Asia are selling far cheaper than our product,” The company lamented in a letter addressed to the Food and Allied Workers Association (FAWU).

The problem, Wilmar adds, also follows the regulation of oil price by Ivory Coast in their market, setting the price far lower than the prevailing price of local producers in Ghana.

The development, it indicated, is making it uncompetitive in the market, adding sales have slumped significantly.

“To make matters worse, our export market, which has been complementing our local sales, has also been hit by non-availability of vessels to transport the product to our main export market – Senegal due to the Covid situation.

“These compounded problems resulted in our worse sales in December 2021 and the low sales continuing into January 2022,” the statement added.

The situation, it explains, has resulted in no space for storage due to low sales and is compelled to take a temporary shutdown of their oil-producing plant to monitor the situation.

They are also asking for the suspension of the collective bargaining agreement, CBA, negotiations, as they do not have the environment to negotiate in good faith.

The company, however, notified that if the situation persists, the business shall face imminent closure.

Read the statement below:

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