August 26, 2008

Despite fears of lower than expected production, Philippine feed millers will definitely not import corn this year. 

Norman C. Ramos, president of the Philippine Association of Feed Millers, Inc. (PAFMI) and vice president and general manager of the feeds business of San Miguel Foods, Inc. said the industry ruled out any corn importation this year amid possible drop of local corn output due to the lack of a higher price incentive from the government.

Local corn producers, led by Philmaize are asking the National Food Authority (NFA) to raise the support price for local corn to P13 per kilo from the recently raised support price of P10 per kilo.

Philmaize said production costs have increased to P9.50 to P9.80 a kilo and not P7.11 per kilo as estimated by the NFA council.

Ramos said PAFMI is keeping an "open" position on the corn growers' petition for a higher support price.

PAFMI, together with the local hog producers are fearful that an increase in the support price for local corn would, in turn, adversely affect their own cost of production.

Albert Lim, president of the National Federation of Hog Farmers, Inc. (NFHFI), explained that feedmillers as well as hog and poultry producers do not directly buy their corn requirement from the farmers, hence, they do not get the current P10 per kilo price.

In actuality, Lim said feedmillers and hog and poultry farmers are more likely to get the corn at a slightly higher price because they have to go through middlemen.

Bringing up the support price, feedmillers and hog and poultry producers fear, may push up the price of corn to the same level as the currently high price of imported corn.

Landed cost of imported corn, less transport cost, is now around P16 per kilo.