NEDA: Temporary hike in pork imports ‘will not kill local hog industry’
MANILA, Philippines — Contrary to senators’ position, additional pork imports “will not kill the local hog industry,” the National Economic and Development Authority (NEDA) said in a Senate hearing Thursday.
“The temporary increase in pork will not kill the local hog industry as imports would potentially account for up to 22.8 percent of total consumption,” Acting NEDA Secretary Karl Kendrick Chua told the Senate Committee of the Whole, which is conducting an investigation into the food security crisis triggered by the African swine fever (ASF) outbreak.
“Also, as mentioned by some experts, imports will not flood our markets since ASF has also affected the production of many countries,” he said.
Chua argued that the country’s limited cold chain facility will serve as a “physical barrier” to huge importation since the total capacity is only estimated at around 268,000 metric tons (MT) for pork “given the requirements of other commodities.”
“Hence, we think the 404,000 plus MT proposed for importation will only gradually enter the country as needed instead of being imported at the same time contrary to industry concerns,” he added.
Local hog raisers as well as senators earlier raised concerns over the proposal of the Department of Agriculture (DA) to increase the minimum access volume (MAV) for pork imports from the current 54,210 MT to 404,000 MT.
But Chua defended this recommendation, citing the “huge” pork supply deficit the country is currently facing.
He said that the Philippine Statistics Authority (PSA) Swine Situation Report as of February 8 this year showed that the country’s swine inventory decreased by 3 million heads or 24.1 percent from 2020 to 2021.
“This significant drop is caused by the African swine fever outbreak which affected almost all regions of the country,” Chua added.
Chua said NEDA projected a pork supply deficit of around 477,000 MT for 2021.
“This is the difference between domestic production of carcass of around 1.2 million MT and the demand of 1.67 million MT based on a 15 kilograms per person per year consumption,” he explained.
“On the other hand, total demand is estimated at 1.67 million MT in 2021,” he also said.
Chua told senators that the “large” supply deficit in pork “has led to a rapid spike” in the retail price of pork in March 2021
“Philippine pork prices average P288 per kilo or 36 percent higher and reach as high as 327 per kilo in NCR (National Capital Region) or 59 percent higher,” he said.
Before this, the acting NEDA chief noted that pork prices were “relatively stable” at around P224 a kilo.
“The spike in retail price pushed meat inflation from 2.9 percent in September 2020 to 19.6 percent on average in the first quarter of 2021,” he added.
“If we augment our hog supply with imports, we could see a decline in full-year inflation, from 4.2 percent down to 3.8 percent. This will fall within the Central Bank’s target of 2 to 4 percent,” he further said.
According to Chua, lowering inflation by ensuring adequate pork supply “is very crucial to some 95 million Filipinos who rely on pork for their regular diet amid this pandemic.”
“On the other hand, the proposal to increase the MAV from 54,000 to around 404,000 MT by the DA is consistent with the supply deficit submitted by NEDA,” he said.
However, the projection of NEDA was the same one questioned by senators in the Committee of the Whole’s hearing on the issue earlier this week.
Several senators scored the DA for the “out of range” projection of the country’s pork supply deficit for 2021, which led to its recommendation to lower tariffs on imported pork and to increase the allowed volume of pork imports to the country.
A proposed joint resolution is expected to be formally introduced by Senate Minority Leader Franklin Drilon during Thursday’s hearing that seeks to revoke President Rodrigo Duterte’s executive order temporarily lowering tariffs on pork imports, which stemmed from a DA proposal.
The resolution also aims to provide for the appropriate tariff and MAV for pork importation.
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