February 2, 2009

 

The Philippine private sectors' plan  to import corn are currently on hold as importing mechanics with the National Food Authority (NFA) and the Finance department are still pending, government and industry officials said late last week.

 

Gregorio A. San Diego, Jr., president of the United Broiler Raisers' Association, said it is still unclear as to what group will be importing corn.

 

Rex C. Estoperez, director for public affairs of the NFA said the imports are yet to be determined if it would be a "government to government" or "private to private" importation.

 

The government has allowed feed millers and livestock farmers to import 200,000 tonnes of corn at a lower 35 percent duty under the minimum access volume (MAV) scheme.

 

The MAV scheme allows agricultural product imports at a lower-than-usual tariff rate. For corn, the MAV stands at 216,000 tonnes and imports this year beyond this volume will be charged the regular 50 percent tariff rate.

 

But the absence of import mechanics due to its pending approval prevents industry groups from importing at lower tariff.

 

The department has yet to approve tax expenditure funds as subsidies from the government used to settle customs duties and other taxes arising from the importation of goods.

 

Poultry farmers expect the mechanics to come out later this week, San Diego said, adding that they want to import the corn themselves for "faster booking".

 

Moreover, the grains agency has to hold a 30-day contract auction for potential suppliers, he added.

 

Estoperez said bidding is needed to ensure transparency but big companies can do their own imports.

 

The private sector eyes buying from neighbouring Thailand, which can ship corn within two weeks after the transaction, faster than 21-day delivery period of corn suppliers from Brazil and the United States, San Diego said.

 

However, corn from Thailand would cost P16-17 per kilogram including freight costs, slightly higher than the P15-15.50/kg charged by Brazil and the US, he added.

 

Renato R. Eleria, chairman of the National Federation of Hog Farmers, Inc said tight corn supply has resulted to higher production costs.

 

Eleria said hog farmers are buying corn at P20/kg., higher than the P12/kg in December and P13-14/kg early this month. Corn is the primary ingredient in animal feeds.

 

The domestic poultry and hog sector consumes about 450,000 metric tonnes of corn per month, according to San Diego.

 

The government earlier said that tight corn supply was caused by planting delays due weather pattern changes and a production shortfall because of high fertilizer prices last year.

 

Moreover, corn output may dip by 2.63 percent to 3.21 million tonnes in the first half because of excessive rain, prompting the Agriculture department to study if more corn imports are needed to satisfy the demand of feed millers and poultry and hog farmers.

 

Full-year corn output in last year fell short by 4 percent at 6.92 million tonnes.