July 21, 2010

Philippine government to review future poultry imports

The Philippine Department of Agriculture (DA) will ensure that local poultry raisers are consulted prior to issuing any import permits to prevent the dumping of cheap imported chicken.

"The DA will review import permits, as well as minimum access volume [MAV] allocations. We will also slap stiff penalties to chicken smugglers," said Agriculture Secretary Proceso J. Alcala.

Alcala said his department will assist poultry raisers to make them more competitive against Southeast Asian counterparts. One of the factors behind the woes currently confronting the industry is the continuous importation of cheap chicken parts from North American countries as cited earlier by poultry raisers from the United Broiler Raisers Association (Ubra).

According to Ubra, the Philippine poultry sector will not be able to increase broiler supply by 20% for the whole 2010 due to the impact of the El Nino weather phenomenon, as well as the threat posed by the continuous importation of cheaper alternatives to local chicken. Ubra president Gregorio F. San Diego said the industry could only manage to increase broiler supply this year by 4.4% to 549.1 million kilogrammes.

"The poultry sector is confronting a number of difficulties this year. For one, El Nino is causing broilers to become smaller and weigh less. Also, we are losing money because we had to sell below production cost," San Diego said.

He also noted that as of April, poultry raisers spent PHP68.30 (US$1.47) for producing one kilogramme of broiler; but farm-gate prices that month averaged PHP66.13 (US$1.42) per kg. In March, poultry raisers suffered bigger losses, as farm-gate prices averaged PHP67.76 (US$1.46) per kg; production cost was pegged at almost PHP75 (US$1.61) per kg. From January to April this year, the group noted that private traders have imported as much as 28.8 million kg of imported chicken meat, which is 123.27% higher than the volume shipped into the country on-year.

"We're really concerned about chicken-leg quarters from North America. The landed cost of chicken, leg quarters are only about PHP60 (US$1.29) per kilogramme," said San Diego.

Last year, the Philippines imported a total of 67.26 million kg of chicken meat, or almost 47% higher than the volume imported in 2008. San Diego said local production displaced by the importation last year reached 59 million broilers. Total sales lost from the importation of chicken meat (including those of allied industries) reached around PHP8.34 billion (US$179.22 million).

"Smuggling of chicken continues to hurt our industry. There is an existing ban on poultry products from China, but you can see Peking duck and century eggs from China being openly sold in the local market," he said.