The Department of Agriculture (DA) and the Food Terminal Inc. (FTI) will implement a cost-tracking system from farms to retailers by May this year, aiming to prevent overpricing and ensure fair earnings for all stakeholders in the business.
Apart from ensuring that each player in the supply chain earns a fair return, the monitoring system has also been designed to shield consumers from unjustified markups, the DA said in a statement on Tuesday.
Based on current data, the cost of raising a pig has been ranging from P80 to P165 per kilogram (kg), making a farm gate price above P230 per kg “already an indication of profiteering,” FTI president Joseph Lo was quoted as saying in the DA statement.
“A margin of P50 to P65 per kg, roughly P5,000 to P6,500 per 100-kg pig, we believe, is already a fair return,” Lo explained.
FTI did not elaborate further on the planned cost-tracking system.
The FTI only called on more participants who could offer pork cuts at prices at least P20 per kg below the maximum suggested retail price (MSRP) of P380 per kg for liempo and P350 per kg for pigue and kasim.
The local subsidiary of Thailand’s Charoen Pokphand Foods PLC has been supplying 100 live hogs daily to a Caloocan slaughterhouse since March 31.
Distributors source the pork directly to this central location to eliminate the need for transporting hogs from multiple farms and significantly reduce logistics costs passed on to retailers and consumers.
“The pilot test has been very successful… Over the first 21 days, we’ve handled more than 2,000 pigs and participating sellers have been able to price liempo at P360 per kg and kasim and pigue between P330 and P340 per kg. We are inviting more hog farms to join this program. FTI guarantees prompt and proper payment,” Lo said.
Despite such efforts, DA Assistant Secretary for Consumer Affairs Genevieve Velicaria-Guevarra said compliance with the MSRP has remained low.
She said that in the 10 markets jointly inspected by the DA and the Department of Trade and Industry (DTI), adherence to the MSRP averaged only about 20 percent.
Guevarra attributed the weak compliance with the MSRP to farm gate prices exceeding the agreed-upon level of P230 per kg and multiple layers of added costs before the pork could reach retailers.
“This week, we will begin issuing notices to stakeholders, requesting them to explain their inability to comply with the MSRP… We’re coordinating closely with the DTI, which holds the enforcement authority on pricing matters,” Guevarra said.
Based on latest DA’s monitoring of public markets in the National Capital Region on Monday, the prevailing prices of pork ham ranged from P340 to P400 per kg; pork belly from P360 to P470 per kg; frozen kasim from P225 to P280 per kg; frozen liempo from P290 to P350.
