August 15, 2018

Philippines turns down feed millers' request to import corn at zero tariff
 

Feed millers in the Philippines have requested to import yellow corn at zero tariff, but are instead rejected by the country's Department of Agriculture (DA).

On August 10, stakeholders of the local farming sector met to discuss a proposal by economic managers to reduce tariffs on some food items in order to mitigate inflation.

At the meeting, there was discussion about the Philippine Association of Feed Millers Inc.'s  (Pafmi) intention to bring in 200,000 metric tons of corn without paying any tariffs, according to sources.

"In as far as the [corn] stakeholders are concerned, they reject zero tariff.  They even asked: 'If the price of domestic corn is low, would the feed millers come to our rescue with a fair price?'" Agriculture Secretary Emmanuel F. Piñol, who opposed the move towards zero tariff, told the BusinessMirror. "Yes. They have to pay the tariffs."

Pafmi had previously wrote to Piñol in July, requesting for duty-free importation of yellow corn to support local supply and ease the price of animal feed. The group made the request even before  economic managers suggested the cutting of the tariff on corn imports. It also argued that the quality and price of corn had been significantly impacted by two typhoons that struck Northern Luzon.

Feed millers pared down their "acceptance parameters" so that they could purchase corn with "higher moisture content," Pafmi said. This, according to the group, caused corn prices to shot up to PHP19.50/kg (US$0.36/kg), from PHP15/kg (US$0.28/kg).

In addition, Pafmi claimed that their surveys showed farmers had delayed their planting which could affect supply in the early part of 2019.

"Although there are feed-wheat imports coming in... this will not substitute for the corn requirements of the poultry industry," the group said. "We are cognizant of the expected harvest of local corn and recommends the imports arrive only between the months of November 2018 to January 2019. We feel this will complement the current supply of local corn and maintain prices to reasonable levels."

Meanwhile, the president of Philippine Maize Federation Inc. (PhilMaize), Roger V. Navarro, said that his group is against the proposed tariff reduction on corn imports. He attributed the opposition to corn farmers not receiving any subsidies even though the corn industry had liberalised.

The Philippines imposes a 35% tariff on corn imports within the minimum access volume, while those outside the quota are levied a 50% duty. Corn from ASEAN member-countries is slapped a 5% tariff.

- BusinessMirror