March 25, 2004

Philippines Pork Prices Remain High

Pork prices at wet markets and grocery shops are still high two weeks after the Cabinet-level Tariff Related Matters committee endorsed to Malacañang the importation of 10,000 metric tons of pork. There is no respite from high prices as President Gloria Macapagal Arroyo herself has not signed an executive order allowing pork importation at a reduced duty of 10 percent from the current level of 30 percent.

Pork importation is supposed to be government's way of intervening in the market to address meat shortage that has driven up prices since December last year. Industry sources, however, said big hog raisers have lobbied with Agriculture Secretary Cito Lorenzo to limit the importation to 5,000 mt (equivalent to 5 million kilos) at the proposed tariff rate of 10 percent. In addition, a group of hog raisers offered to import the volume to give them some sort of protection.

Meat dealers and processors opposed the move, saying the reduced volume would not make an impact on the market. "The idea here is to flood the market with table grade pork to bring down pork prices. Five million kilos is merely equivalent to less than a month's consumption. There will still be shortage," a meat dealer said.

The issue as a result has stalled the drafting of the implementing rules and guidelines of pork importation. The Bureau of Animal Industry and the National Meat Inspection Commission are also taking a long time to resolve the issue.

Francisco Buencamino, executive director of the Philippine Association of Meat Processors Inc. (Pampi), wrote Tariff Commission chairman Edgardo Abon to express his opposition to the proposal of hog raisers. He said the limited import volume would hardly make a dent in the market. Pork prices will remain prohibitive and the government stands to lose revenues without alleviating the situation.

"A volume of less than 10,000 mt will not influence market prices of pig meat. The subsidy rate of 10 percent will only be wasted," Buencamino said. "Restricting this privilege to the hog raisers group as the proposed importers is not an intervention because the 'anointed' group is the same party that has influenced present prices. Neither do they have the core competence of sourcing and distributing pig meat."

A source, meanwhile, said the government could provide immediate solution to soaring pork prices if concerned agencies get their act together. It will take only seven days for a meat shipment to arrive once an order is placed. Pork can be imported in carcass and cold cuts form and will likely come from the United States, Europe, Canada and South Korea.

But hog raisers are trying their best to delay pig imports. The high prices of pork ranging from P140 to P160 per kilo have made their operations very profitable but consumers are at the losing end of the equation.