By JED MACAPAGAL and ANGELA CELIS
Hog raisers yesterday made a last-ditch attempt to persuade the Department of Agriculture (DA) to reconsider plans to import all of the country’s pork deficit this year to come in at lower tariff under the minimum access volume (MAV).
With the executive order (EO) for the importation of pork at lower tariff just waiting for issuance by President Duterte, the Department of Finance (DOF) has ordered a tight watch at borders for possible misdeclaration of imports once the new MAV allocations and tariff rates are approved.
An EO that modifies tariffs cannot be issued by the President while Congress is in session.
At a Senate hearing yesterday, Chester Warren Tan, president of the National Federation of Hog Farmers Inc., said the DA must clarify if all of the 404,210 metric tons (MT) of imported pork under MAV will only be marketed in Luzon.
The DA is bent on importing all of the projected deficit of 400,000 MT under MAV this year from the normal 54,000 MT.
Pork shipments under MAV are only charged with 30 percent tariff while those outside the program are slapped with 40 percent.
The Tariff Commission has submitted its recommendation on increasing the MAV to the President. It also recommended a lower tariff rate on pork imports within the MAV, which should come from ASF-free countries.
In a statement, the Department of Finance (DOF) Secretary Carlos Dominguez has directed the Customs Commissioner Rey Leonardo Guerrero “to take a close look at the potential smuggling of pork,” and “to watch out for traders possibly misclassifying pork imports once the new MAV allocations and tariff rates are approved by the President.”
“Some pork importers may resort to technical smuggling,” Dominguez told Guerrero.
Edible offal of bovine animals, such as swine, sheep and goats are taxed much lower, which some importers may declare as prime pork shipments to avoid paying higher import duties.
Offals of swine are slapped a 7 percent tariff.
The recommendation is to peg pork within MAV at 5 percent in the first six months and to 10 percent in the following six months from the current 30 percent.
Aimed at boosting pork imports, the DA said the expansion of the MAV will help offset soaring pork prices amid the outbreak of the African Swine Fever (ASF) in the country, which has significantly reduced the pork output of local producers and jacked up market prices.
At the hearing, Senate committee on agriculture, food and agrarian reform chair Cynthia Villar disclosed at the hearing a discrepancy in the landed cost of imported pork being quoted by the DA and the Bureau of Customs (BOC).
BOC’s estimated landed cost of imported meat is at P132 per kg. inclusive of the tariff rate of 40 percent, cost of freight, cold storage and other related costs where the declared value of meat is at $1.65 per kg.
The DA’s projections at a tariff rate of 40 percent but using current offers for frozen pork is at $3 per kg. which results to a landed cost of P296.64 per kg.
DA Secretary William Dar said the agency will present to President Duterte a proposal to introduce an insurance coverage for commercial hog raisers to encourage local raisers to repopulate their hog inventories.
Dar said under the proposal, 4 million fattener hogs will be insured for P10,000 per head while 1 million breeder hogs will be covered for P14,500 each.
Dar said DA, through the Philippine Crop Insurance Corp. will shoulder 50 percent or P740 million of the total premium of at least P1.48 billion. The remaining 50 percent will be shouldered by commercial hog raisers.
Meanwhile, the DA continues to monitor the extent of ASF in Leyte after the disease was confirmed to be present in the town of Dulag late last month.
Dulag is the fourth locality to have been found positive with ASF in Leyte following Abuyog, Javier and MacArthur.
Earlier this month, as much as 2,000 hogs were culled in Leyte in a bid to stop its further spread.
As of end last month, ASF has been recorded in 12 regions, 38 provinces, 447 cities and municipalities as well as 2,311 barangays in the country. A total of 436,423 hogs were also depopulated to stop possible infection.
Meanwhile, amid renewed calls of some market store owners of another pork holiday, the DA said the delivery of pork from Visayas and Mindanao to Luzon is still ongoing.
As of February 20, the DA already facilitated the delivery of a total of 62, 257 live hogs equivalent to 345,229 kg for Metro Manila.
From the said number, Calabarzon supplied the bulk of it at 30,938 live hogs or 49.69 percent followed by Mimaropa with 7,564 or 12.15 percent and Western Visayas with 7,117 or 11.43 percent.
Feed costs also rising
In a separate briefing yesterday, agriculture advocacy group Tugon Kabuhayan said the cost of animal feeds is increasing.
“We are urging the private sector and government to sit together on what we believe is an emerging challenge. The main ingredient for animal protein production is corn, soybean, fish meal rice bran and wheat bran. We observed that corn prices in the world market hit the all-time high in the last 5 years. In 2016, it averaged at $161 per MT and at $171 per MT in 2020 but last month, it was at $234.47 per MT and it may continue to trend upward,” said Asis Perez, the group’s convenor.
He said that ongoing efforts to improve the utilization of copra and rice bran for fish feeds as well as the propagation of algae must further be enhanced in order to help avert the possible scenario.