November 21, 2008

Philippine tax-free wheat imports to discourage corn farmers from planting


When the Philippine government cancels the tax on wheat import, Filipino corn farmers may be discouraged from planting more of the crop next year.


The Philippines said on Wednesday (November 19) that it had removed import tariffs on wheat for six months to stabilize domestic prices. Before this, Philippines imposes a 7-percent tariff on wheat for feed.


An influx of feed wheat imports may cut local corn prices, slashing returns of farmers who are currently enjoying good margins.


The Philippine Maize Federation (PhilMaize) said in a text message sent to reporters that allowing duty-free wheat imports for six months "will render unwarranted competition for local corn farmers."


Philippine corn production may reach 6.9 million tonnes this year, higher than last year's output of 6.3 million tonnes.


The new order will take effect 30 days after publication in national newspapers.

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