Philippines to buy 62,500 tonnes corn, most likely from Thailand

Philippine feedmillers, as well as poultry and hog raisers, plan to buy a combined 62,500 tonnes of corn, most likely from Thailand, to beef up tight supply, the state-owned National Food Authority said Monday (February 16).

Importers in the private sector may bring in up to 50,000 tonnes, while farmer producers may import 12,500 tonnes, said the agency.

The imports, for arrival no later than March 15, form part of a 200,000-ton volume the government has allowed local feedmillers, poultry and hog raisers to bring in at a preferential tariff duty of 35 percent.

As planned, the NFA will purchase the volume on behalf of local corn end-users using the agency's tax expenditure subsidy program, the agency said.

In exchange for utilizing its tax expenditure subsidy, the NFA will charge a service fee of PHP4 a kilogram for the imports.

The balance from the 200,000 ton-approved volume, or 137,500 tonnes, will be imported around May and June, when the corn harvest is off season and domestic supply is expected to get tight.

"We agreed that only a portion of the 200,000-ton volume will be imported at this time, as supply from the (summer) harvest is beginning to hit the market," said Renato Eleria, vice chairman of the National Federation of Hog Farmers, Inc.

The plan for the NFA to import corn at a preferential duty was prompted by high domestic corn prices about a month ago, due to a supply shortage. Local corn prices soared in January to a record PHP24 to PHP26/kg from an average price of only PHP13.32/kg in 2008. Prices have since softened to PHP16/kg.

Corn is a major component in livestock and poultry feeds.