The government has ordered an investigation on the illegal use of imported palm olein, according to the Federation of Philippine Industries (FPI).
FPI in a statement said the Presidential Management Staff, in a correspondence to Undersecretary Domingo Panganiban of the Department of Agriculture, told the agency to evaluate and take appropriate actions on the complaint lodged by the group.
Jesus Arranza, chair of FPI and of Fight Illicit Trade, said he received reliable reports and obtained some documents pointing to unscrupulous importers who are using palm olein for other purposes but are declaring their importations as for compounding of animal feeds to avoid the payment of value-added tax (VAT) and other taxes and duties.
“The reality is that a big portion of the imported palm olein is being diverted for sale to either producers of biodiesel an additive to diesel fuel, and to the retail market (public markets, groceries, supermarkets, and sari-sari stores) as cooking oil for eventual sale to the consuming public,” Arranza said.
He noted that while Department of Energy regulations specifically provide that only coconut oil can be blended with diesel to produce “biodiesel,” these importers actually delivering palm olein instead to substitute for coconut oil.
Since coconut oil is always priced much higher than palm olein, Arranza said these importers are getting another windfall of cash from substituting coconut oil with pam olein.
“This is naturally hurting the coconut farmers and industry,” he said.
Arranza said the Bureau of Animal Industry has admitted total certifications issued for the duty and VAT-free importations of palm oil have been increasing. – Irma Isip
