July 20, 2006

 

Philippine feed industry renews bid to import cheaper corn

 

 

Philippine feedmillers have renewed their quest for the Department of Agriculture to allow the entry of corn imports at a preferential tariff, an industry executive said Thursday (Jul 18).

 

Feedmillers have requested that they be allowed to import 120,000 tonnes of corn under the Minimum Access Volume Plus mechanism, and are now seeking the endorsement of the agriculture department.

 

They would also have to seek approval from the President and Congress before they can import more corn at a lower tariff under MAV Plus.

 

The MAV is the minimum volume of sensitive agriculture commodities that the Philippines has committed to import at lower tariffs under its World Trade Organization obligations. In the case of corn, the MAV tariff was set at 35 percent, while imports above the quota are subjected to a tariff of 50 percent.

 

Feedmillers have almost exhausted the 216,000-tonne MAV volume for 2006, and are asking for an additional allocation under MAV Plus.

 

Last month, the agriculture department said it would not allow additional corn imports under the MAV Plus mechanism, as that could pressure local corn prices.

 

Farmers are currently harvesting the Philippines' main corn crop, which accounts for around 60 percent of the country's total corn output.

 

Domestic corn output is insufficient to meet demand from the livestock and poultry industries, partly because of post harvest losses of up to 30 percent due to a lack of post harvest facilities, said Ric Pinca, executive vice president of the Philippine Association of Feedmillers Inc., or PAFMI.

 

Also, the Department of Agriculture had deemed the feedmillers' request to be premature, as it had thought the imports were intended for arrival in December.

 

However, the imports are intended for arrival in September, because feed demand is expected to rise as livestock and poultry producers prepare for Christmas and New Year festivities, Pinca said.

 

The Philippines' corn output could reach 5.8 million to 6 million tonnes in 2006, up 11 percent from last year's production.