Calibrate appetite for imports, traders told

MANILA, Philippines — Aside from hog producers, the National Economic Development Authority’s (Neda) recommendation to ease high pork prices by cutting tariffs will also affect poultry and corn growers and likely derail the country’s agricultural development for years to come, the Inquirer learned on Sunday.

The Inquirer obtained during the weekend copies of letters from four industry groups who wrote to President Rodrigo Duterte detailing the effects of tariff cuts on livestock, poultry, and corn and urging traders, especially importers, to moderate their appetite for the sake of Filipino farmers.

“In [the] scheme of things, the corn farmers are always the victims when it comes to imports, may it be pork, chicken, corn, or corn substitutes by way of feed wheat,” the Philippine Maize Federation Inc. (PhilMaize) told the President.

“We call on our government to calibrate their appetite on imports that will make unnecessary injury to the sector involved in the livestock chain,” the group added.

PhilMaize warned that easing importation limits to accommodate 404,210 metric tons of pork would translate to losses of P16 billion to over 500,000 corn farmers.

PhilMaize’s appeal was separate from those of Samahang Industriya ng Agrikultura (Sinag), United Broilers Raisers Association (Ubra), and National Federation of Hog Producers Inc. (NFHI), all opposing the tariff cut originally proposed by the Department of Agriculture and endorsed by Neda. “Consumers and producers will be the losers, while only a handful of importers will benefit from the tariff reduction and [minimum access volume] expansion,” Sinag said in its letter.

‘Windfall profit’

“Importers are [already] reaping a windfall profit of P136 a kilogram [at current tariffs]. Reducing the tariff to 5 percent will mean a windfall profit of P165 a kilo, but will only have a minimum impact on retail prices per the study of the House ways and means committee,” Sinag said.

The group was referring to the committee study showing that tariff cuts on pork would only result in a price reduction of 50 centavos but also cause losses to hog producers, who have already sustained big losses due to the African swine fever (ASF) that the DA has failed to stamp out since February last year.

NFHI, in its letter, urged the government to use tariff proceeds to revive the local hog industry, which has already lost a third of the country’s hog population to ASF.

No logic to tariff cuts

The government could raise at least P3.8 billion from the current pork tariff rates, NFHI said, while the government allocated only P1.17 billion for the livestock and poultry sector in 2021.

“Imagine what the additional P4 billion from these tariffs can do for the sector, not just to survive, but to thrive in the years to come,” NFHI said.

Poultry group Ubra said the cut would also “derail the efforts of the chicken industry to increase production in order to fill the gaps in the hog sector caused by [ASF]” and urged the government to earmark the import duties collected from chicken and pork to subsidize producers and consumers.

Albay Rep. Joey Salceda, chair of the House ways and means committee, said there was no logic to the tariff cuts because prices have already risen to almost P400 from P187 per kilo and traders would still profit even if the tariff were increased to 100 percent.

Marikina Rep. Stella Luz Quimbo also opposed the tariff cuts and demanded on Friday a probe of the Agriculture Competitive Enhancement Fund, which could have been used to address the crisis.