March 14, 2008

 

Thailand's cut on soy import tariff to only lessen feedmeal costs by 2 percent

 

 

Feed industry representatives in Thailand said Thursday that the recent cut on import tariff for soymeal would do minimal improvement, adjusting feedmeal costs by 2 percent only.

 

Thailand's animal feedmeal price subcommittee said the import duty for soymeal would be temporarily reduced to zero.

 

The proposal is aimed to lessen costs for animal feed producers, especially the pig farmers, to cushion the price of pork.

 

The duty-free soymeal is expected to take effect after the Cabinet approves and is to remain until the end of the year.

 

Currently, soymeal is subject to 4-percent import duty.

 

The Commerce Ministry said waiving the import duty for almost a year would lessen feed costs for pigs by 1.15 percent.

 

However, feed producers said that the zero tariff would have minimal effect, and instead called for the raise of pork prices to address higher production costs.

 

The producers are also asking the government to set up a special fund to encourage development.

 

A representative from Thai Feed Mills Association said the government should allow product prices to increase in line with rising raw-material prices, as these are up by 30-70 percent.

 

Last year, Thailand imported a record 2.1 million tonnes of soymeal for animal feed manufacturing.

 

Industry players pointed that the tariff cut to zero for soymeal imports would only reduce the costs of producers by 1 to 2 percent, but the major costs of production, which rose more than 30 percent this year, have not decreased.