Tariff on flour imports to raise bread prices

By: Amy R. Remo, July 20th, 2013 08:46 AM

Bread. INQUIRER FILE PHOTO

MANILA, Philippines—Consumers should brace themselves for a possible increase in bread prices this September, as importers of Turkish flour will no longer be able to supply bakers with the low-priced flour.

The price of the Pinoy Tasty is expected to go up by about P3 to P4 per loaf from its current price of P37, while the cost of a 10-piece pack Pinoy Pandesal may increase by up to P2, according to the Filipino-Chinese Bakery Association Inc. (FCBAI) and the Philippine Baking Industry Group (Philbaking).

In their joint statement, the groups noted that the inability of importers to supply Turkish flour is “a big concern to the bakers because this means that they will be forced to use the higher-priced local flour to produce breads, more particularly the Pinoy Tasty and Pinoy Pandesal.”

Produced by small neighborhood bakers, the Pinoy Tasty and Pinoy Pandesal refer to the brand name of affordable bread products that use the cheaper Turkish flour.

Local flour importers have stopped importing Turkish flour due to the pending petition by the Philippine Association of Flour Millers (Pafmil) to hike the tariff to 20 percent from the current 7 percent. The group stressed that Turkish flour millers are exporting flour to the Philippines “at dumping prices which is in violation of World Trade Organization rules.” This, Pafmil claimed, puts local millers to a disadvantage.

FCBAI claimed that the Harinang Pinoy, which was developed by Pafmil as a low-priced alternative to imported flour, was a “failure” due to its poor quality.

“Our members reported failures, up to 20 percent rejections, resulting in big losses,” said FCBAI president Benito Lim.

Philbaking president Walter Co noted that bakers are now on a panic-buying mode, snapping up the remaining Turkish flour before it disappears in the local market by September.

Co is also appealing to the Department of Agriculture to allow the continued importation of Turkish flour without an increase on tariff to ensure that bakers can still avail of low-priced flour, at least until December this year.

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