January 7, 2009

Philippine feed millers are seeking to import up to 300,000 tonnes of corn free of tariffs, due to high prices of the yellow grain in the local market, a senior agriculture official said Tuesday (January 6).

 

The Philippine Association of Feed Millers Inc., or Pafmi, submitted the request to the Department of Agriculture last month, said Agriculture Assistant Secretary Dennis Araullo.

 

Based on the group's request, the imports would be for arrival not later than March this year, Araullo said.

 

The issue is up for deliberation by the Inter-Agency Committee on Rice and Corn later this week, he said.

 

However, Araullo said that he personally isn't keen to support the request, noting that even at a regular tariff of 35 percent, the landed cost would translate to around PHP12.50 (US$0.27) a kilogramme, still well below prevailing domestic prices of PHP14-PHP16/kg.

 

"They can import as much as they want but they need to pay the tariff. Allowing the feedmillers to import tariff free would kill local farmers. But this is just my personal opinion. I don't want to pre-empt the interagency committee," he said.

 

According to Araullo, keen interest by feed millers to import corn isn't related to availability of the grain in the local market. In fact, corn output in the first three months of the year is projected to rise 3 percent to 2.05 million tonnes from a year earlier.

 

"But there wasn't any interest to import corn a year ago simply because global prices were at high levels," he said.

 

Last month, local feed millers bought 90,000 tonnes of corn from Brazil.

 

An initial volume of 55,000 tonnes were contracted in early December, followed by a 35,000-tonne deal. The imports are for arrival within January. Food and beverage conglomerate San Miguel Corp. (SMCB.PH), which has a feed and poultry division, imported the bulk of the volume.

 

Corn is a major component in livestock and poultry feed.