DA told: You’re just increasing the profits of pork, rice importers

Industry groups and lawmakers questioned the Department of Agriculture’s (DA) proposal to cut the tariff rates imposed on pork and rice, stressing current import duties still allowed traders to buy these commodities on the cheap.

Stakeholders got on a heated debate during the Tariff Commission’s hearing on the DA’s proposal on Thursday. The agency, with support from the National Economic and Development Authority, asked to lower the tariff rates for in-quota and out-quota imports of rice and pork to depress consumer prices.

Under the DA’s proposal, pork imports under the minimum access volume (MAV) would get a 5-percent tariff for the next six months and a 10-percent tariff for the succeeding six months from the current rate of 30 percent.

For pork imports under MAV, the agency suggested that tariffs be reduced to 15 percent for the next six months and 20 percent in the succeeding six months from the current 40 percent. The DA also proposed rice imports would have a lower tariff of 35 percent from the current in-quota and out-quota rate of 40 percent and 50 percent, respectively.

Rosendo So, Samahang Industriya ng Agrikultura chair, argued the landed cost for imported pork at a 40-percent tariff would be at P120 a kilo.

Including transport and storage costs, imported pork should only be selling at P153 a kilo at the retail, he said. Until recently, consumers had to shell out P400-P440 a kilo.

“Lowering the tariff would only bring additional profit to importers … We won’t be complaining if imported pork in the markets is judiciously priced, but it isn’t. Do we see imported pork being sold for P153 a kilo? That never happened. This would only kill the local industry,” he said.

Asked about the agency’s basis for its proposal, Agriculture Undersecretary William Medrano said in a phone interview he would have to consult the agency’s policy council. He represented the DA during the hearing.

More groups have expressed their opposition to the tariff cuts, including the legally mandated public-private Philippine Council for Agriculture and Fisheries (PCAF).

In an interview with Ernesto Ordoñez, Alyansa Agrikultura chair and committee chair of PCAF, he said the organization was “against these reductions and wanted the commission to defer discussions because the DA’s justifications are not strong.”

The stakeholders clarified they were not against importation given the shortage in domestic hog supply, but stressed that tariff reductions would only benefit importers.

They added the proposed reduction would affect the government’s tariff receipts—used to fund the development of local industries.

The DA is expecting a pork shortfall of 388,790 metric tons by year-end as the country’s hog tally continued to be decimated by the African swine fever. This is equivalent to 88 days’ worth of supply based on Filipinos’ pork consumption.